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Gateway's financial issues not evident here

POSTED: January 18, 2014 10:00 a.m.

Interim CEO for Gateway Behavioral Health Services David Crews said Gateway’s branch facilities in Liberty County are not affected by the recent discovery of misused funds at Georgia’s largest health-care provider for patients who have developmental disabilities, are mentally ill or suffer with an addiction.
“As far as Liberty County is concerned, we met with county commissioners and the mayor,” Crews said. “We assured them the services at Liberty County facilities will not be affected. There have not been any changes in the staff there. We’ve been able to maintain services there at previous levels.”
Crews said that last July that he was appointed by Georgia Department of Behavioral Health and Developmental Disabilities Commissioner Frank Barry as the interim manager tasked to oversee operation of Gateway BHS. He was directed by the commissioner to complete a financial assessment of Gateway BHS within 60 days. That analysis also was to determine Gateway BHS’ ability to deliver services according to its contract requirements, he said.
Gateway BHS services eight counties in Coastal Georgia, including Liberty, Long, McIntosh, Glynn, Camden, Bryan, Chatham and Effingham. In his report to Barry, dated Sept. 17, Crews noted that he received the full support from Behavioral Health and Developmental Disabilities as well as cooperation from community stakeholders and Gateway BHS employees.
“I visited numerous service sites across the eight-county region, visiting with program managers, supervisors, line staff and community stakeholders,” Crews said. “The Gateway members were open and eager to provide information.”
His report began by disclosing that Gateway BHS had established several nonprofit and for-profit corporations. This created an organization structure that was hard for both the public and employees to understand, he said. Furthermore, using funds from DBHDD contracts to operate a nonprofit corporation is a violation of Official Code of Georgia # 37-2-6.1(j).
One of those corporations, Gateway Employment and Manufacturing Inc., is a bottling plant in St. Marys. State funds apparently were diverted to start and then prop up this plant, which provided jobs to patients with developmental disabilities. In his report, Crews said the plant is scheduled to close in October.
He said Gateway’s unrestricted fund balance has declined since fiscal year 2009 and has remained at a loss of $3.8 million for the past four fiscal years.
He also noted that Gateway’s administrative costs are higher than other organizations with $30 million budgets. He said Gateway’s 17 percent administration fees are a lot higher than the average 12.4 percent administration fees reported by 18 Georgia community-service boards.
Crews’ report said former Gateway BHS CEO Frank Bonati’s salary went from $125,000 in 2003 to $211,000 in 2013. He said even though Bonati was paid $211,000 for his last year, Bonati’s last contract did not authorize a 2 percent pay increase from the previous year — a difference totaling $12,636.26.
Crews also said despite what Gateway’s lawyer at the time told him, Gateway board member Matt Cardella’s service on the board was a conflict of interest. Cardella works in Edward Jones’ Hinesville office, which received 1.35 percent of all contributions to Gateway employees’ retirement accounts.
“Mr. Cardella was very cooperative and very much concerned,” Crews said. “He had offered to resign from the board, but was (wrongly) told there was no conflict of interest.”
Crews said Cardella resigned immediately when new attorney J. Pargen Robertson advised him to do so.
“There was no evidence of fraud at Gateway BHS, just poor management decisions,” Crews said as he summarized his findings. “We’ve been reducing expenses in ways that don’t affect consumers (patients). We’re in the process of a nationwide search for a new, permanent CEO. Because I’m the CEO of our sister facility in Lawrenceville, I’m dividing my time between there and Brunswick.”

 

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