The Brown University News Bureau Distributed April 12, 1996
Contact: Mark Nickel
Independent audit shows no wrong-doing
Brown Department of Psychiatry fulfilled all terms of Corrigan contract
An independent audit and University investigation show Brown's Department of Psychiatry and Human Behavior delivered full value to the Commonwealth of Massachusetts under a professional services contract with the Corrigan Mental Health Center. The Boston Globe had reported that Brown was paid for research it never conducted.
PROVIDENCE, R.I. -- Brown University and its Department of Psychiatry and Human Behavior delivered more than full value to the Commonwealth of Massachusetts under a professional services contract through the John C. Corrigan Mental Health Center in Fall River, according to an independent audit by Coopers & Lybrand L.L.P. and the University's own internal investigation.
The University disclosed its findings late yesterday in a facsimile transmission from Brown Provost James Pomerantz to Gerald Whitburn, the Massachusetts secretary of health and human services. Whitburn's own investigation recently led to the reassignment of a Corrigan administrator within the Massachusetts Department of Mental Health.
Brown began its investigation Sunday, Jan. 8, 1996, hours after the Boston Globe published a front-page story reporting anonymous charges of research improprieties under the Corrigan contract. Citing anonymous sources and unspecified documents, the Globe alleged that Brown's psychiatry department had received payments from the Massachusetts Department of Mental Health for research that had never been done and that Brown had submitted "partially fabricated" invoices. The audit found no support for the Globe's allegations.
"I am pleased that Coopers & Lybrand's report shows Brown University did indeed deliver all that was promised to the Commonwealth of Massachusetts and more, and that Brown actually underbilled for its services rather than overbilled," Pomerantz said. "We are taking steps to ensure that the billing inaccuracies identified by the auditors do not recur."
The contract was designed to establish - for the first time at Corrigan - a full range of academic and research programs and to do so within five years. The University asked Coopers & Lybrand to conduct an audit of the Corrigan relationship, focusing on three areas:
In conducting its study, Coopers & Lybrand interviewed 21 current and former employees from Corrigan, two Brown-affiliated hospitals and Brown (some of whom were among the Globe's sources), conducted a physical inventory of equipment purchased by DPHB for Corrigan and reviewed a large volume of documents including contracts, invoices, agreements, financial statements, memos and other correspondence.
Editors: A copy of the Coopers & Lybrand report is appended to this release. Additional copies are available by fax from the Brown News Bureau at 401/863-2476.
As is true of nearly all academic departments in the Brown University School of Medicine, the faculty, administration and programs of the Department of Psychiatry and Human Behavior are distributed across several Brown-affiliated hospitals. As part of their formal affiliation agreements with the University, these hospitals annually contribute funds to support the core activities of the department, from which the hospitals receive a variety of resources and services.
The auditors determined that although the Corrigan contract was nominally a cost-reimbursement arrangement, the contract's own narrative clearly describes an affiliation agreement. All principals who were interviewed, including Daniel Amigone, Corrigan's director, and Dr. Martin Keller, chair of the psychiatry department, were clear and in agreement that the contract was to lead to Corrigan's affiliation.
Accordingly, the contract required that Brown:All of those services were performed, and performance was certified both by paper documentation and by the testimony of persons involved. Amigone, Corrigan's director, expressed satisfaction that the goals and objectives of the contract had been achieved. He told the auditors that patient care improved substantially at Corrigan as a result of the psychiatry department's supervision of medical staff and residents.
The Department's calculation of the allocable cost of providing services under the Contract appears reasonable and exceeds the amount invoiced.
The auditors studied the psychiatry department's calculation of Corrigan's portion of the affiliation costs. The department identified costs that could be identified specifically to the Corrigan site and allocated to Corrigan a portion of costs for services distributed to all affiliated hospitals. While the department invoiced Corrigan $78,355 for the 1994 fiscal year, the auditors determined that the Commonwealth of Massachusetts received resources and services worth more than $100,000. Brown underbilled the state.
The invoice for services provided during the contract year (1994) was inaccurate.
While the services were delivered and the amount was certainly justified (even considerably less than it might have been), the invoice did not list the correct names of persons who did the actual work under the contract. The auditors attributed the mistake to an inexperienced staff member at Brown and to poor contract administration both at Brown and at Corrigan. With guidance and instruction from the Corrigan administration that the invoice needed to correspond to budget line items in the contract, the invoice was prepared incorrectly by a newly hired administrator, submitted and approved.
Brown accepts responsibility for the inaccuracy and is taking steps to ensure that the mistake will not be repeated.
There is no indication of improper personal enrichment or diversion of funds by the Department with respect to funds received from the Commonwealth
The auditors determined that the funds received from Corrigan were, in fact, treated in a manner similar to funds received from other affiliated institutions. No personal gain or improper diversion of funds occurred.
During their examination, the auditors found a high degree of consistency between the documentation and the interviews with participants and others knowledgeable about the Corrigan relationship. That consistency, plus the failure of any contrary information or testimony to come to light during the audit, led Coopers & Lybrand to conclude that the questions posed by the University have been fully answered.
In light of the Coopers & Lybrand audit and its own investigations, the University considers the charges raised by the Globe to be unsubstantiated and untrue and is satisfied that its Department of Psychiatry and Human Behavior delivered full value under terms of the Corrigan contract.
######