South Florida Sun-Sentinel (Sunday)
Broward Health criticized by rating agency
Capasso’s surprise resignation as CEO cited in statement
The leadership turmoil at Broward Health drew a rebuke from a major creditrating agency this week, which criticized the hospital system’s “ineffective management and governance practices.”
S & P Global Ratings said the surprise resignation of chief executive Beverly Capasso “reinforces our negative outlook,” although the agency did not downgrade Broward Health’s already mediocre BBB+ credit rating.
The opinions of rating agencies help determine how much interest an institution such as Broward Health must pay to borrow money. Their views also carry weight as independent assessments of an organization’s prospects.
“In our opinion, the turnover in the CEO position — four CEOs in the past three years — highlights further instability in senior leadership and a heightened credit risk from ineffective management and governance practices,” S&P wrote in a statement.
Capasso, who took the CEO job in January after serving on an interim basis, announced her resignation Oct. 3, without giving any reason.
Her impending departure dashed hopes for stability for a system that has seen the suicide of a previous CEO, a massive federal fine and the indictment of several leaders on charges of violating Florida’s openmeetings law.
Andrew Klein, chairman of the Broward Health board, issued a statement Friday that blamed Broward Health’s general counsel, Lynn Barrett, for costing the system a CEO
who brought “stability, progress and a very capable management team.”
Although his statement did not mention Barrett by name, he left little doubt he was talking about the person he recently accused of abusing her office to pursue bureaucratic enemies and protect exorbitant payments to outside law firms.
“The cause of management instability at Broward Health has now been uncovered,” Klein said. “The question to be answered at the next meeting of the board of commissioners is whether a majority of the board has the determination and courage to take appropriate action — to bring transparency, accountability and effective oversight to the public hospital system’s legal affairs.”
Klein has been highly critical of what he sees as excessive spending on law firms. As of June, for example, Broward Health had paid $2.6 million to Foley & Larder, the firm that has received the largest amounts.
A Foley partner, Myla Reizen, is a former colleague of Barrett’s and a fixture at Broward Health board meetings. And Barrett recently retained a leading partner at a major Washington law firm to investigate an allegation of wrongdoing against Broward Health executives.
“There is no reason for Broward Health to be spending millions upon millions of dollars of taxpayersubsidized funds on attorneys — including now thousand-dollar-per-hour counsel — without the board itself determining whether such expenditures are truly warranted and in the public interest,” his statement continued. “I will continue to press this issue, at the next meeting of the board later this month.”
Barrett did not respond to a request for comment.
In response to a request for comment on the statements of both Klein and the credit agency, the Broward Health media relations office issued a statement from Alan Goldsmith, the system’s chief financial officer, who mentioned the recent cut in the property tax, or millage, rate.
“We are proud of the many milestones achieved over the past year, including the recent reduction in the millage rate for taxpayers,” he said. “We are fortunate to have a talented management team that remains focused on delivering the highest level of care to all we serve.”
It’s unclear when the Broward Health board will try to sort out the situation.
An emergency board meeting had been scheduled this week, but it was canceled for a lack of a quorum.
Two seats on the sevenmember board have long been vacant, as Gov. Rick Scott hasn’t nominated anyone for them. The board is scheduled to hold its regularly monthly meeting Oct. 31.
Broward Health, which is partially supported by property taxes, operates five hospitals and various outpatient centers that serve the northern twothirds of the county.