Summary Report from Coopers & Lybrand LLP

This confidential and privileged work product
was made public by Brown University on April 12, 1996

This report summarizes our procedures and findings regarding the relationship between the Brown University (the "University") Department of Psychiatry and Human Behavior (the "Department" or "DPHB") and the Massachusetts Department of Mental Health's ("DMH") John P. Corrigan Mental Health Center ("Corrigan") with respect to the 1994 contract (the "Contract") between the DPHB and Corrigan.

At the commencement of our investigation, several questions were posed to us regarding alleged irregularities in the Contract between the University and Corrigan. We were asked, among other things, to determine what was the nature and extent of work performed by the Department for Corrigan; whether the Department fulfilled its obligations under the Contract; and whether there were any irregularities with respect to the Departmental processes for accounting, reporting or billing for the work done.

Summary of Procedures

In arriving at our findings, we performed the following procedures between January 15, 1996 and April 9, 1996:


In the course of our investigation we interviewed twenty-one current and former employees from Corrigan, the Department, the University, Butler Hospital, and Rhode Island Hospital. We interviewed individuals to determine the relationship between Corrigan and the Department; the preparation of the 1994 invoice; general University contract procedures; and the services provided by individual members of the Department.


On April 2, 1996, we performed a physical inventory of materially all the equipment purchased by the Department for Corrigan with no exceptions noted.

Document Review

A large volume of documents produced by the University, the Department and the DMH was reviewed in the course of this investigation. Of particular note were the following:



Summary of Findings

The services anticipated by the contracting parties and described in the Contract narrative were provided by the Department.

The Contract outlined the following services to be provided by the Department:

Critical to an understanding of the recent concerns regarding the Department is a review of the contractual relationship between DPHB and Corrigan. Although the Contract indicates that it is a cost-reimbursement arrangement, the narrative section within the Contract describes an affiliation arrangement. To determine the intended nature of the arrangement, we reviewed the Contract and related documents and interviewed the principals involved with the agreement, Dr. Martin Keller, Chairman of the DPHB, Daniel Amigone, Corrigan Director, as well as others involved with Corrigan. In the inverviews, both parties communicated their understanding that Corrigan would become affiliated with the Department. The relationship would be similar to the "Shared Chair" relationship described in the following paragraph, that the DPHB had established with other hospitals.

The activities of the DPHB are supported by affiliation agreements between eight hospitals and the University. Each affiliate, including the University, contributes annually an agreed upon amount to provide a source of funds necessary to develop and maintain the Department. As a result of this relationship, the affiliates receive a variety of resources and services, both shared among the facilities and specific to each institution. Dr. Keller's Chairmanship of DPHB is shared among the Psychaitry Departments of affiliated hospitals.

Based on our investigation as outlined above, we conclude the above services were performed. In each case contemporaneous documentation supports the providing of services. In addition, our interview subjects described substantial personal knowledge of contract performance. Finally, as further evidence of that performance, Mr. Amigone has expressed satisfaction with the achievement of the goals and objectives of the Contract. He stated that patient care improved substantially at Corrigan as a result of the 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.

In fiscal year 1994, the Department invoiced $78,335 to Corrigan. With the understanding that the Department was never required to allocate costs of the Shared Chair agreement to any individual affiliate, we have analyzed the Department's estimate of Corrigan's share for the fiscal year 1994. The Department's estimate was developed by assigning costs which could be identified specifically with Corrigan (equipment and research funds) as well as allocating certain costs incurred for services available to all hospitals participating in the "Shared Chair" affiliation agreement. Based on our analysis, the Department's estimate that the allocable cost of the Corrigan affiliation exceeded $100,000 is reasonable.

The invoice for services provided during the contract year (1994) was inaccurate.

The invoice sent to the DMH for fiscal year 1994 did not accurately reflect the individuals who provided effort at the Department's expense, but rather appears to have been an attempt to prepare an invoice strictly conforming to the categories and rates set out in the Contract's budget section. Based on interviews with individuals involved with the invoice's preparation, it appears that inexperience in the Department and poor contract administration by both parties led to the inaccuracies.

A newly hired Department Administrator prepared the invoice with the assistance of the Commonwealth's former Contract Officer employed at Corrigan and Corrigan's Director. With their guidance and the instruction that the invoice must correspond to the Contract's budget line items, the invoice was prepared, submitted and approved.

There is no indication of improper personal enrichment or diversion of funds by the Department with respect to funds received from the Commonwealth.

We have performed procedures to confirm that the funds received from the Contract were treated in a manner similar to those received from other affiliates. None of our procedures disclosed, nor did any interview subject assert, that any personal gain or improper diversion had occurred.

This report represents a summary of our findings to date in this investigation. We will continue to investigate any new allegations should they arise. However, the consistency between the documentation we have reviewed, the interviews we have conducted and the failure of any contrary information or testimony to come to light during the course of our work leads us to believe the questions posed to us have been investigated to a conclusion.

-- Coopers & Lybrand, LLP

Return to release text