Columbia University Medical Center did not meet several terms of its affiliation agreement with Harlem Hospital, according to an audit report released last week by Comptroller John Liu.
Liu claims that the Health and Hospital Corporation, the city's health care organization, did not properly enforce CUMC's compliance with the contract.
"Columbia is not complying with certain key financial and administrative provisions of its affiliation contract with HHC to provide patient services to Harlem Hospital," Liu said in a statement.
From 2008 to 2009, the report—titled "Audit Report on the Harlem Hospital Agreement with the Columbia University Medical Center"—says that Columbia did not properly record its handling of $109 million dollars provided by HHC to be used for patient services at the hospital. The auditors were unable to determine whether Columbia used the money to fund patient services.
The audit report also claims that CUMC did not follow appropriate hiring procedures when staffing Harlem Hospital, and hired physicians who did not have up-to-date contracts.
Columbia has had a relationship with Harlem Hospital for almost 50 years, according to its website. The University provides physicians and staff there through a contract with HHC.
Columbia and HHC have received two previous versions of the report, compiled by Deputy Comptroller Tina Kim and the Bureau of Audit, before the latest version was released.
HHC President Alan Aviles responded to Kim shortly after seeing a second draft.
In an email dated June 25, Aviles admitted that HHC and Columbia had sometimes been lax in following the contract. But he said that the audit report's "assumptions and conclusions" were "grossly misleading and inaccurate." His note was included in the final report.
"We provided your auditors with many facts about the management of the contract, as well as voluminous documentation of the meticulous reconciliation of actual documented expenses," Aviles wrote. "Yet the import of these facts and documentation are not fairly reflected in your draft report."
Aviles also felt that the draft report falsely portrayed HHC as unable to "guard public funds" or properly handle Columbia´s expenses.
"There was no evidence of the misuse of funds," Aviles wrote.
In a joint statement, HHC and CUMC praised the auditors' recommendations in the final draft, but agreed that the audit report had exaggerated minor errors in compliance and presented them as "major deficiencies."
"We share HHC´s concerns that the report is misleading and appears on a fundamental misunderstanding of the Affiliation Agreement ... between the University and HHC," CUMC's Lee Goldman wrote to Aviles after seeing an earlier draft of the report. The letter is included in the final public version.
The audit report claims that HHC "repeatedly refused" to submit documents from Columbia such as quarterly fee statements in a timely manner, which HHC had argued were "working documents that had not been finalized and could therefore be misleading." According to Goldman, this claim is false.
Also, Goldman says, the auditors focused on "a period prior to the University´s issuance of new time-records policies and procedures," and their findings may be skewed.
"We are confident that there were no significant discrepancies to warrant a conclusion that Columbia is non-compliant with the contract," Goldman wrote.
Regardless, auditors are insisting that both parties follow the recommendations in their report to make sure government funds are properly spent.
"As a best business practice, it is important that an organization develop written procedures to help ensure that its key operations are implemented efficiently, effectively, and consistently," the auditors state.
"Contracts are written and signed for simple reasons, and neither HHC nor any other government agency can play loosey-goosey with its terms," Liu said. "As taxpayers, we just can't afford it anymore."
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