Until early this month, folks in Grand Junction, Colo., were pleased as punch with Randall M. Phillips, president and chief executive of their hospital.
Phillips had been recruited in mid 1998 from Florida to run the 78-bed nonprofit facility, and he had brought it all kinds of professional honors, including a place on this year's list of the nation's top 100 hospitals.
But Phillips had a problem back in Florida, where he had worked in both hospital administration and medical billing in Clearwater and Orlando.
After his stepmother's death in January 1986, Phillips continued to cash checks erroneously sent to her by the Department of Veterans Affairs. More than $154,000 in benefits were issued before the VA caught its mistake in March 2000. Interviewed by law enforcement officials in November 2002, Phillips and his wife, Agatha, "promptly admitted to knowing that they were not entitled to those funds, but took them anyway," documents in the U.S. District Court in Tampa say. The couple also agreed to repay the VA.
Phillips' Orlando lawyer, Brian Phillips (who is not related to his client), described his client's action as "a horrific judgment error."
The couple pleaded guilty in September, and Phillips finally confided his problem to Community Hospital's board. Despite their hopes for probation, both Phillips and his wife were given jail sentences during a hearing in March; Phillips for one year and one day; his wife for five months. On April 9, the hospital's board appointed an interim president and broke the news to staffers that their beloved leader was headed to federal prison.
"Everyone has had a very hard time digesting this news," said Becky Jessen, head of special projects for the hospital. "This is a very unfortunate personal issue, but Mr. Phillips' leadership and his commitment here were exemplary."
Said Phillips' attorney, "The feeling was he may be flawed, but he's one hell of a hospital administrator."
