published Sunday, August 7th, 2011

Security change costly for Erlanger Health System


by Chris Carroll
Erlanger Hospital
Erlanger Hospital
Erlanger discusses hospital security
This video shows Doug Fisher, vice president of government and corporate affairs at Erlanger, discussing the hospital's security situation. His statements about considering former officers of the Erlanger Police Department for work have been disputed by the officers, who were fired last March.
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Despite a consultant's recommendation, Erlanger Health System outsourced police jobs to a private company at nearly twice the cost and disregarded a pledge that former security officers would get first consideration if their department was restructured.

"We wouldn't leave you hanging out there and say, 'well, you're on your own,'" Chief Operating Officer Charlesetta Woodard-Thompson told a gathering of officers, according to a videotape obtained by the Chattanooga Times Free Press. "That's not right. We're not going to do that."

Added Vice President of Government and Corporate Affairs Doug Fisher at the same meeting, whose date could not be verified: "This is an administration telling employees, 'We've got your back; we've got you covered.'"

Erlanger dissolved the entire department in March, the same month it concluded a search for private security companies to replace the officers. In its request for proposals, Erlanger promised to award a five-year security contract "to the Proposer who submits the lowest and best proposal," records show.

On March 24, hospital trustees unanimously went along with a management-backed proposal to outsource to Walden Security, a Chattanooga-based company that offered its services at an annual rate of $2.3 million -- more expensive than all but one bid. SEI Inc. submitted the lowest bid at $1.5 million a year.

Bid coordinators at SEI Inc. last week declined to discuss the matter with the Times Free Press.

Three other security companies -- two of which, like Walden, are certified by the International Organization for Standardization -- submitted bids below $2 million, Erlanger records show. The hospital sent letters to the losing bidders stating that Walden Security offered "the lowest & best bid" at $2.3 million.

Total expenses for the Erlanger Police Department's 2008-09 operating budget were $928,579, records show. The hospital spent $1.4 million on security in 2009-10.

Erlanger has reported several monthly losses recently and historically has requested and received annual seven-figure infusions from Hamilton County. This year, the hospital got $1.5 million in tax money.

"Walden Security was the lowest priced agency that met all the selection process qualifications and could most effectively meet the security needs of our campuses," hospital spokeswoman Pat Charles said in an email to the newspaper.

Hospital executives have at least two stories justifying the change. During the March 24 meeting announcing the Walden bid award, Woodard-Thompson said Erlanger had "difficulty in recruiting and retaining a qualified police force."

But in an interview last week, Fisher said Erlanger abolished its police department because "the city would no longer commission our officers."

On Oct. 6, 2009, the Chattanooga City Council adopted a resolution that gave 25 Erlanger officers commissions that didn't expire until 2050, meeting minutes and police identification cards show.

Interviewed Friday, Chattanooga City Attorney Mike McMahan said a few of the Erlanger officers once left the Chattanooga Police Department "under less than favorable circumstances," but that otherwise, council members approved the commissions without hesitation.

The City Council did have the power to revoke Erlanger's police commissions, records show.

"That's not what happened in this case," McMahan said, adding that establishing future Erlanger police commissions was "never a problem" for the city.

Dan Johnson, chief of staff for Chattanooga Mayor Ron Littlefield, said the city commissioned Erlanger's officers until 2050 "as a temporary means for them to have security until they were able to hire their private security force that is now in place."


Erlanger initially awarded Walden Security a temporary contract to work alongside the hospital's longtime police force last year.

But the table appeared set for permanence. On April 12, 2010, executives drafted a memo titled "You Should Know: Erlanger Signs Temporary Contract with Walden Security" and named Ben Allen, a Walden employee, Erlanger's director of security.

Two days later, Allen received a master key for the hospital, a privilege afforded only to top security officials.

On Sept. 2, 2010, employee relations worker Jan Gentry emailed an Erlanger police officer to say Walden employees -- presumably Allen -- had "the right to write, change and enforce policy in the security department."

Three weeks later, Erlanger's bid proposal for security services went out. It was five months after executives drafted the memo about Allen's directorship. Six companies responded to the request.

On March 24 of this year, Erlanger's board of trustees unanimously awarded Walden Security the five-year contract at $2.3 million a year. That evening, hospital officials said the transfer wasn't a cost-saving measure, a position they stand by today.

"The intent [and we were very public about this] was always to provide a safer environment for our patients, visitors and staff," spokeswoman Charles said in an email.

Unlike former Erlanger police officers who had standard law-enforcement arresting authority, Walden Security employees have no more arrest privileges than private citizens, Charles said in an interview.

In an interview, Fisher said the hospital looked for a security firm "that had the ability to provide commissioned police officers," an extra that never was mentioned in Erlanger's request for proposals.

Walden now uses Erlanger money to pay commissioned, off-duty Hamilton County Sheriff's Office deputies to supplement observe-and-report Walden guards so that there is some kind of arresting authority on scene, Charles said.

Amy Walden and Mike Walden, the Lookout Mountain-based couple who run Walden Security, donated $1,000 each to election campaigns for Hamilton County Sheriff Jim Hammond, financial disclosures show.


With the stated goal of beefing up its police force, Erlanger paid $6,000 to Durham, N.C.-based Security Assessments International Inc. to conduct a study, now considered confidential. The Times Free Press obtained a copy.

The Feb. 5, 2010, study lauded the Erlanger Police Department's officers, calling them "knowledgeable, experienced and dedicated police and security personnel."

It noted a tight annual security ledger and a small staff, praising the officers for maintaining order "despite these budgetary and manpower constraints." The study recommended expanding the existing force and advised against using contract security personnel for several reasons, including a high turnover rate and inexperience.

"The quality of the replacement officers may not be up to the hospital's standards," the report states. "[Private security officers] are often drawn from available personnel who do not have experience in the health care setting."

In its request for proposals, the hospital said former Erlanger Police Department officers would get "first priority" to retain their positions with the winning security bidder.

But after the contract was awarded, Charles said those officers would "have an opportunity" to apply for a job with Walden -- no guarantees.

Many former Erlanger officers logged more than 20 years at the hospital. They handled 50 assaults, 79 building emergencies and 259 suspicious activity incidents in fiscal year 2008-09, Erlanger records show.

Andrew Stinnett, a Chattanooga attorney who represents seven former Erlanger police officers, hand-delivered a letter asking each board trustee to review the consultant's study before voting on the Walden contract.

He said none of the trustees responded.

James Worthington, one of the trustees, said he "thoroughly examined the contents" of the study but voted for Walden because hospital executives recommended it and told him the city wouldn't commission additional Erlanger officers.

"The truth should always come to the surface," Worthington said Friday. "If I had been told that the city or county would have commissioned other officers so that we had a sufficient amount, I would have voted against Walden. ... I'll stand on the fact that I was not told that."

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328Kwebsite said...

Who owns Walden Security? Isn't this a local company that makes Republican campaign donations? It smells like this is another kickback deal that uses taxpayer funds to pay for Republican political ads.

August 7, 2011 at 5:21 a.m.
hetzelri said...

The article says that a couple on Lookout Mountain own the company and gave money to the Sheriff for his campaign. There is something more here, though. It has the appearance of a kickback, but I'm not sure it is political. We may never know. This is a huge problem of either not doing homework or illegal activity involving money. It smells like the latter.

August 7, 2011 at 9:46 a.m.
fechancellor said...

328K: Doug Fisher was twice Zach Wamp's Chief of Staff.

Mike Walden is the Chairman of the Hamiliton County Election Commission.

August 7, 2011 at 9:50 a.m.
Myopinion said...

I worked at Erlanger for several years, and the people in charge there (regardless of who they've been)have always subscribed to the "old boy network" of doing business. "You pat my back, and I'll pat yours." They rarely make any decision based on what's strictly logical or cost effective.

August 7, 2011 at 10:31 a.m.
Astropig said...

No way this passes the smell test. Good catch , TFP.

Can people in positions of public trust not just ONCE do the right thing for all involved ? Is it any wonder that people's trust in the instrumentalities of society is at rock bottom?

I swear , we're becoming like Haiti.

August 7, 2011 at 11:30 a.m.

Am saddened to read this article. Had surgery at Erlanger and felt so good about the medical staff. Very caring toward me, yet very friendly and personable. Why the board has to do things that leave doubt is way over my head. Hate the good old boy crap!

August 7, 2011 at 12:21 p.m.
Marathon5454 said...

How many "sweetheart" contracts do the Waldens have with Hamilton County and the City of Chattanooga?? How many lower bids were ignored because the Waldens are politically connected? And how much money are these "good ole boy" contracts costing the taxpayers of this area?? The Grand Jury needs to investigate these contracts and who all got paid off to get them

August 7, 2011 at 1:41 p.m.
ARYFROSTY said...

It should be a shame that Erlanger's management team "promised" their employees that they would have jobs and then backpedalled on them and made sure they wouldn't have jobs. Unfortunately it can't be because Erlangers political hacks have no shame.

August 7, 2011 at 2:30 p.m.
328Kwebsite said...

So, this is their $100K job of the week, then. Our local politicos have been milking the city and county government with some type of quasi-legal money and job procurement for their friends pretty much every week, all year. We have probably lost millions to them.

I remain convinced that these people have been running a Metro Payoff Club that exploits the separation of city and county governments to cover their payoffs and kickbacks. Every week, it's some new $100K+ job or payoff. Every quarter they have a new target for their political diatribes.

I don't agree with their party, but it's not just that. It's not a Democrat or Republican thing. It's their total misuse and abuse of office that's disgusting. I feel that we're being misrepresented by crooks who are raiding the government bank accounts to raise money for the downpayments they'll need for loans to get political ads. It's some kind of fraud and money laundering. I wouldn't be surprised if we are only seeing 10% of what's going on.

I can't even bring myself to have much of an ideological disagreement with these guys on the philosophy of government. They're crooks. It's not that they need some subtle correction. I'm convinced these guys need some handcuffs and bank account seizures.

The Metro Payoff Club. Self-appointing, self-paying, self-serving: it's just a totally wrong approach to governing. Totally disgusting.

August 7, 2011 at 5:17 p.m.
pr356 said...

Erlanger Police officers were dedicated, but Erlanger did it’s officers dirty. Doug Fisher, Mike Walden and Sheriff Hammond are all friends. Erlanger officers didn’t stand a chance. Now the citizens will have to pay double for less security… go figure!

I think there should be an investigation from the top down. They are spending our money foolishly.

August 7, 2011 at 6:26 p.m.
condor01 said...

I agree with astropig and marathon5454, this does not pass the smell test and there should be an investigation, but not by the grand jury, the US Attorney's office should investigate Erlanger and Walden.

What idiots decided to replace veteran police officers with security guards who get a few hours traing at best. Does it bother anyone that Fisher and Mike Walden are friends? Does anyone at Erlanger feel safe now?

This is an outrageous waste of taxpayer money. Brexler, Fisher and Woodaed-Thompson should all be fired along with everyone else involved in this obvious kickback scheme. Come on Trutees wake up, it's time to clean house.

August 7, 2011 at 6:49 p.m.
seekingtruth said...

The Trustees of Erlanger need to quit taking everything their CEO and administrators say at face value. You have a responsibility to the citizens of this region to look beyond their words and seek the truth. They have proven they cannot be trusted and will do what it takes to pad their personal pockets. The CEO's father-in-law once again makes a decision based on helping a personal friend's business and not what is best for the hospital. Now the patients, staff, visitors and families are not protected by actual commissioned law enforcement, but by a security guard with no extensive training at twice the cost. Why didn't Walden Security hire these officers? It is time to get someone in there running the hospital that actually cares about the citizens of this region. Erlanger has had the top doctors in the region and the best clinical staff. They give it their all to save lives just to have an administration put a dark cloud over the hospital. Now that same administration is running off those doctors and no one on the board is questioning why they are leaving. Wake up trustees!

August 7, 2011 at 8:02 p.m.
Abovethelaw said...

Be careful when talking about Mike Walden because he will sue John Doe again just like he did when he got caught trying to pay off walking horse contestants.

August 7, 2011 at 9:04 p.m.
fechancellor said...

Mr. Carroll, you write...

"Total expenses for the Erlanger Police Department's 2008-09 operating budget were $928,579, records show. The hospital spent $1.4 million on security in 2009-10."

Does this include pension and health insurance benefits?

August 7, 2011 at 10:11 p.m.
ceeweed said...

Indeed this fails the smell test. It's a peachy deal for a few well-heeled people with clout, but it reeks of Chattanooga Shoo Shoo to me.

August 7, 2011 at 10:36 p.m.
Civic_Minded said...

This is an exceptionally good example of investigative journalism. Erlanger is not only a vital medical resource for Chattanoogans, but a lifeline as well for East Tennessee, North Georgia, and North Alabama. It is funded by tax monies collected from local, regional, state, and federal sources. To jeopardize its medical excellence capabilities with grossly inadequate and inferior protective services is a betrayal of the public trust and mismanagement of the first magnitude. In these times of budget austerity, why would you replace a well-functioning special campus police force with private security guards unable to effectively protect the patients, visitors, staff? And, equally disturbing, at twice the cost! An official inquiry is imperative to determine the full extent of wrongdoing and accounting to the public. One of Erlanger's mottos is, "Above the Rest". Well, that's air ambulance service, not the law, or just basic business ethics 101!

August 7, 2011 at 10:40 p.m.
Frozennickel said...

ANOTHER scandal involving Sheriff Jim Hammond! Doesn't it seem weird that Sheriff's deputies are moonlighting with Walden Security? WTH?!?

I love how the Trustee's of Erlanger thought it was a GOOD IDEA to pay nearly 3X more for 1/2 the services currently provided (from commissioned, armed officers who have arrest power, to "observe and report" cop-esque personnel who have NO TEETH, such that now we need Sheriff's deputies to hold their hands as they roam the halls of that money pit hospital). These guys must've worked on the federal budget negotiations recently!

Just wondering when the anti-trust lawsuit will be filed...wait for it.....(more taxpayer money gonna be paid out)

Chris, it'd be interesting to go back and looked at all the lawsuits involving Erlanger.... That'd be a great article! Keep putting these nutjobs' feet to the fire, Chris.

August 8, 2011 at 3:06 p.m.
macropetala8 said...

I can't really say I blame Erlanger. Most of the individuals they hired in security were rejects from the local Hamilton County sheriff's dept. or city police, and from other areas, who had gotten into trouble at some point. They were then given jobs at Erlanger where they continued own with their often dishonorable behavior. Erlanger, I believe, was looking at this from a potential costly liability standpoint. On the other hand, by contracting security positions out to a private company, that private security company will be held financially liable. This was an Erlanger C.Y.A decision. Remember the former city cop working security at Erlanger who tasered that weak man upon dismissal from Erlanger who died after being tasered? The man was so weak he couldn't stand on his own, so they tasered him?

August 8, 2011 at 6:57 p.m.
thomash said...

Does everyone know that Doug Fisher is Jim Brexler's son-in-law? This is beginning to really smell funny.

August 10, 2011 at 6:28 a.m.
Abovethelaw said...

Mike Walden and Doug Fisher are buddies from years ago. One had helps the other for no good.

August 11, 2011 at 3:21 a.m.
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