By Errol Castens/NEMS Daily Journal
OXFORD – Dr. Robert Corkern said he gave in to then-Panola County Administrator David Chandler’s demand for a $25,000 bribe after Chandler threatened to cripple the Batesville hospital, which Corkern said he bought to save.
Corkern was on the stand several hours Friday in the health care fraud, bribery and conspiracy trial of businessmen Ray Shoemaker of Tupelo and Lee Garner of Batesville relating to Tri-Lakes Medical Center.
Corkern, an emergency medicine physician, worked at the hospital in 2004 when he heard it was in danger of closing, he said, and started putting together a plan to buy it.
“I believed it could thrive and even become a full comprehensive medical center,” he said on direct questioning by Assistant U.S. Attorney Robert Mims. “We could grow a medical center that would be at least as competitive and as big as the one in Oxford.”
Unable to secure financing as a for-profit venture, Corkern said he accepted an offer to use Shoemaker’s nonprofit, Kaizen Consulting, Management and Research Inc., to make the purchase with government-backed nonprofit financing. Shoemaker was then the hospital’s chief operating officer and later became its chief executive officer.
“I wanted it to be a for-profit entity from the beginning,” Corkern said. “It’s very easy if you are a nonprofit to break some kind of rule that makes it look like you’re enriching yourself from the nonprofit.”
His own guilty plea to bribery may support that statement: Corkern asserted that Chandler told him of hospital-owned money held by the county and offered to transfer it to the cash-strapped hospital. Afterward, he said, Chandler suggested he get a $25,000 payment, growing increasingly adamant about it.
“What he said was, ‘Nothing’s gonna go from here on like you need it to,’” Corkern said. “I believed he could make good on his threat to take the hospital down, and I believe it to this day.”
Prosecutors sought to shore up Chandler’s often contradictory testimony with a host of documents and other people’s testimony that often reinforced the claims of fraud.
Michael Heilman, one of Shoemaker’s attorneys, introduced the theory during Corkern’s cross-examination that David Vance, who secured Corkern’s financing, authorized the $250,000 payment from the hospital to Shoemaker’s nonprofit.
Vance was under indictment in the case at the time he died in 2010 under questionable circumstances in a one-vehicle accident.
Garner attorney Ronald Michael further proposed on Corkern’s cross-examination that the hospital’s recovery fully explains why Tri-Lakes, whose bed occupancy grew dramatically during the time just before and after its purchase, was hiring more nurses from Garner’s staffing firms.
Corkern said Shoemaker “was doing a good job” as CEO.
George Randolph, a former TLMC board of trustees member, affirmed that a $250,000 payment would have required board approval, while Panola County Chancery Clerk Jim Pitcock testified briefly about the amount of federal funding that the county had received.
Vickie Roberts, a forensic computer examiner for the FBI, testified about an email from David Vance asking Ray Shoemaker whether or not to bring up a $250,000 payment to Shoemaker. Heilman’s cross-examination questioned whether Shoemaker received the email, which Roberts said she could not prove.
Andrew Bussom, a health care auditor for the U.S. Attorney, showed some financial records of Kaizen, including some $50,000 going to a church and some $42,000 spent for a car.
In cross-examination, Bussom confirmed that Garner’s company was shorted nearly $100,000 in its dealings with Tri-Lakes.