Borrego Sun - Since 1949

September is National Fraud Prevention Month. So, guess what came in the mail today from the Borrego Health Community Foundation? Nothing less than the Borrego Health 2020-IRS 990 Tax return, which had been requested since the due date, which is typically June 30, the end of the budget year for the non-profit.

This year, the result of numerous requests, and reminders that the 990 is supposed to be available to the public and that the regulators probably wouldn’t be pleased by withholding it, the Borrego Sun received the 2020 tax returns.

True irony. Receiving the document that led the Borrego Sun to investigate Borrego Health during the month dedicated to preventing fraud. The shock and anger of the revelations, and omissions in the Foundation’s IRS-990s was the motivation for the Sun to keep asking questions and digging.

This tax disclosure is for the year 2020 and picks up in the last half of 2019 through June 2020. That means it does not include any of the drastic budget changes resulting from the FBI/DOJ investigation, which began in 2020. So, it’s the last document purportedly showcasing the numerous ways Borrego Health cheated tax-payers and those who need, but can’t afford private health care.

Changes expected in the next tax disclosure for 2021 will show the budgetary crisis created by the removal of the dental contract programs, managed by Premier Healthcare, which are under investigation, and denial of reimbursements by California covered dental care and any federal reimbursements of dental services for the same.

Since this alleged fraudulent income accounted for approximately 80 percent of the BH budget, adjusting to, and finding supplemental funds to operate the disparate agreements and arrangements that make up the organization’s 20 plus clinics, dental offices, and pharmacies in 2021, will likely make or break the non-profit. It will certainly reduce its ability to maintain the status quo.

Probably, the clinic that will be hurt the most will be the Borrego Springs clinic, and the underserved population this clinic supposedly serves. It may not be too much of a change, the Borrego Springs clinic has long been the needy stepchild of organization. BH was increasingly diminishing its ability to provide services by firing valuable staff and reducing visits by health specialists over the past few years.

However, there were adjustments to this disclosure that had to be made as a result of the ongoing fraud investigation, such as the disclosure of Premier Healthcare Management Corp, which was illegally and intentionally omitted from previous IRS reports. It’s easy to understand why the Premier contract was hidden. BH had to disclose in this 990 that Premier made $21 million through 2019 – 20. The total amount stolen from taxpayers over the approximately five years the so-called dental management company was partnering with Hebets, will go unknown. Hopefully, the FBI knows. It’s likely a great deal of money and obviously not made legitimately, considering the owner of the company’s expertise and work history was construction and real-estate with no experience in dental health care.

The only relationship Daryl Priest, the owner of Premier, had to non-profit (FQHC) dentistry was his friendship with Bruce Hebets. And, then there’s fact, he built all of BH’s buildings and handled Hebets’ real estate transactions. More under the table money? Many of Hebets’ deals appear questionable at best, risky and illegal at the worst.

Priest was already a wealthy man as a result of his El Cajon construction and real estate businesses with numerous corporations (30 and more) filed with the state, and only one private health care corp. Evidently, his health management company proved to be the most profitable with the least amount of work involved. That’s the way passive income from fraud works.

The evil genius of Bruce Hebet lives on after his demise. His legacy includes a staggering trail of pain and suffering and humiliation passed on to the many honest hardworking employees of the health empire. Many innocent people lost jobs and faith in the organization, while many dishonest people are still being paid extraordinary salaries. Unfortunately, the organization has also, apparently, lost the faith and trust of its clientele, at least in Borrego Springs.

Since the investigation some of the highly paid officers also lost jobs such as CEO Mikia Wallis, a student of Hebets’ bent character and Diana Thompson, the CFO, who did not have the background or education in finances to oversee the Foundation as it grew from a single clinic in Borrego Springs to an octopus swallowing up rural clinics to become the “fastest growing and most expensive healthcare non-profit” on the Federal Health and Human Services Administration’s list of Federally Qualified Health Centers. (FQHC).

They were complicit because they were over their heads, lacking the experience to handle the job titles they had been awarded by Hebets, usually due to loyalty, family ties and local relationships, rather than skill or expertise, and because they let greed overcome their better angels. Or maybe, the fraud went on so long, unpunished, it became normalized.

Others, maybe, the most complicit still remain on the payroll to this day.

Speaking of the BH tax returns, they are public documents, intended to be seen by anyone who is interested, or has an investment in community healthcare. However, Borrego Health has always made its tax returns difficult to see.

Previously, they were locked in a drawer in Diana Thompson’s office. One had to contact her and request it. Who knew that was the only way to retrieve it from Borrego Health? And, of course, it depended on if she answered her phone, got the message, or managed to release the tax report in a timely manner. There was the option of going to the administrative office to collect it, if, and only if, a person managed to figure out how to play the game of hide and seek.

The only other way to find the BH 990 is through rigorous internet searches of organizations that post non-profit tax returns, and government websites, like GuideStar and Pro-Publica, the IRS and the Federal Heath and Resources Service Administration (HRSA) which is an agency of the United States Department of Health and Human Services (HHS).

HHS is the federal department that has responsibility for providing services through government insurance programs, like Medicare and Medicaid, to America’s elderly, poor, isolated, medically vulnerable and underserved populations. Besides the egregious theft of money meant to aid these people, BH made it almost impossible to confirm or verify how they managed their income by making it extremely difficult to retrieve their IRS reports.

The only document harder to get or see is the contract with Premier Health, which many members of the Board of Trustees claim to have never heard of or seen. Keeping agreements from the Trustees is as illegal as not disclosing them on the IRS990. These were only two of the regulations Borrego Health violated.

When it comes to violations of state and federal rules and regulations for healthcare non-profits, particularly federally qualified health centers, it’s rather amazing that HRSA monitors, or the Inspector General, Attorney General or HRSA, under the highly lauded, Health Care Fraud and Abuse Control Program, in over 10 years, didn’t notice anything strange going on at BH. The individual assigned to monitor BH for HRSA quickly disappeared, or was replaced as soon as the investigation was announced. It’s assumed that person didn’t want to answer any questions.

Word is that HRSA digital systems had begun to “red flag” certain aspects of the BH tax disclosures, but the persons at the computer had not felt the need to push the right buttons.

In 2020, the AG’s office filed criminal charges in 101 cases, had 85 convictions and returned $23 million in criminal restitution and $17 million in civil monetary recoveries. It doesn’t seem like much money considering the amounts that were allegedly misrepresented, misreported, illegally earned through kickbacks, leasing agreements, and illegal sharing of its FQHC billing and reimbursement privileges by BH.

While BH may one day appear in one or more of these reports as a mere statistic, the shame of having Borrego Springs identified with health care fraud will live on. Bruce Hebets sullied the integrity and mission of Borrego’s original healthcare founders and financial backers. There should be restitution for Borrego Springs, which allows for the clinic’s separation from BH, retention of its FQHC status and autonomy and a local governing board of trustees so that the quality health care the original creators of Borrego Springs healthcare initiative envisioned has a chance to become a reality.