Friday, January 25, 2013

Was Pat McCullough Set Up by the Government?

     Someone suggested to me that the purchase of Hawthorne Medical Center might not have been  "on the level"--that the federal government staged the whole thing as a way of getting inside my business and confiscating all my earnings, past and present.
     In this scenario, Pat McCullough would have been a fake, an envoy for the feds, slated with the task of looking for ambiguities in my clinic's billing-coding-documentation process, so the government could steal money under the guise of cleaning up what has been portrayed in recent years as the awful, messy, fraudulent world of doctoring.  Government agents--who are people, after all, with salaries to earn and political aspirations to nurture--would collect revenues for our flagging economy, feather their beds (the FBI takes a percentage of money from plea-bargaining to fund its coffers), and represent themselves to the TV-sedated people of our country as good policemen who are making the world a better place.
     Those of us who question government raids, and who claim that our national liberties are being threatened, look as much like "radicals" to the indifferent masses as did the few brave town criers in the 1930's when Hitler and his men sang lullabies to their people, getting them to sleep through the decimation of millions of its country's most creative and contributory human beings.
     It's a fact that Pat did "due diligence" for eighteen months prior to the transfer of my Hawthorne business into her name, and that she had access to all the clinic's billing records, including the Medicare insurance numbers for patients, physician licenses, and all manner of data that could make for a real heist.  I have no idea if she was behind a big scam, supported by the government or outside the law.  I hadn't considered the possibility that she might have been an actor in a Dragnet drama--a government agent masquerading as a do-gooder with a Kentucky twang, out to get the bad doctor.
     Pat signed a confidentiality agreement with me, and our lawyers exchanged the usual overwrought dispatches, and c.c.'ed  them to everyone, so it seemed natural to assume that my clinic information, including patient charts and insurance numbers, was safe.
     (But government agents aren't bound by confidentiality agreements, are they?  It seems to me that they can do whatever they like with people's private medical records, and with their bank accounts.) 
     I suppose governments everywhere engage, at times, in slick set-ups, based on the need to find guilty parties, and justified, at least outwardly, by a mission to protect their citizens.  And I expect that too often the cocksure ship of their assumptions founders on the shores of the facts.  Even worse, most victims of their misguided attacks never get compensated, and are left like people on small desert islands to their own devices.  The number of death-row inmates who have been exonerated by DNA evidence, and sent back out into the world after lifetimes of mistreatment, attests to this.
     But it's hard to believe that anyone--even our immoderate government police--would resort to such exreme methods--buying an entire business?--to investigate a rural doctor's business, when it could obtain every document it needed to indict and destroy that doctor with the wave of a subpoena, or steal every asset in the books by assuming ownership of bank accounts and titles..
     And Pat...well, she was slick.  And she might have been of the right caliber for bureaucratic work.  But I like to think the government would have been a little less sordid, if all it wanted was my money and my life.  Why put the health and well-being of thousands of patients at risk, depriving them of access to medical care at their local medical facility, and why add so many productive employees to the unemployment rolls?  Our elected officials and their minions don't waste resources like that, do they?  


  1. Is there any evidence that McCullough's purchase of the Hawthorne clinic was anything other than a failed business venture? Is there any evidence that McCullough benefitted materially from the purchase or closure of the Hawthorne clinic? Is there any evidence that McCullough failed to provide an accurate financial disclosure in her bankruptcy filing? Is there any evidence that McCullough retained any real estate or other assets without the court's approval? Did any creditor, yourself included, challenge any aspect of her bankruptcy filing? Is there any evidence to support your suggestion that McCullough's purchase of the clinic was part of any coordinated federal effort?

    1. Hi Pat, Thanks for checking in. I appreciate your following my blog, and your many intriguing questions. I think the answers would make for very compelling reading. Remember, this is a blog, not a scientific or legal document. Feel free to add more information my readers can trust, as you see fit. If you're in the area, let me know and we can go out for a cup of coffee some time. Best wishes, Dr C.

  2. No, not Pat. I'm a fellow creditor named in the bankruptcy that took the trouble to investigate the questions I posed in my previous post, instead of making silly unsupported claims.

    1. ... And if you really believe any of the claims that you have made, wouldn't you have acted on your suspicions? If McCullough owed you millions and you thought she was hiding it away someplace wouldn't you have hired an attorney, accountant, or private detective to establish whether her filings represented an honest accounting of her assets? I had my concerns and those concerns were satisfied. I'm not here to defend McCullough. In fact, I am not sure if I've ever met her. Yes, I've enjoyed your blog. Yes, when I read false claims I have a hard time restraining myself. Having read your blog for several weeks, I'm not sure your legal troubles have anything to do with your sale of the Hawthorne clinic. It might be a rumor, but I was told that no Hawthorne records were seized, only records from your current clinic. Likewise, have the Feds seized any proceeds you enjoyed from your ownership of the Hawthorne clinic, cash or real estate? Could your legal troubles be the result of recent activity?

  3. I'm glad you're "satisfied." Maybe it's a case of sour grapes. It's very costly to "act on my suspicions," I found out--and, given Pat's finesse at hiding funds (she tricked you!) unlkely, even if I prevailed, to result in remuneration. The evidence you call for could probably be mined. Unfortunately it's not worth a lifetime and a fortune for one individual to do it. This is exactly what certain kinds of criminals count on, and why they do what they do.

  4. As for the "failed business venture"--this is absurd beyond measure. The business was a turnkey operation. And if Pat had had any interest at all in making it work, I was a few miles or a phone call away to help. She refused to speak to me after the sale, and it wasn't because she actually though I had committed fraud. She had a plan! And it worked, in part, because of people, perhaps, like you.

  5. Fair enough. I wouldn't begin to minimize your losses. As far as the clinic goes, I'm only aware of the finances at the very beginning and the bankruptcy, I know very little about the operation of the clinic. My company reviewed a decade of financial documents before signing off on the bankruptcy. Not sure why I thought it was important to interject some facts, it doesn't really matter that much. It was either a horribly executed business plan or a horribly executed scam, either of which failed to benefit McCullough much while leaving behind a path of destruction. It appears that she borrowed a great deal of money and couldn't generate 30% of the revenue you had enjoyed. I don't know much more than that other than what I feel is a pretty accurate picture of the financial aftermath.

  6. The only way the "failure" could have been attributable to a "horribly executed business plan" would have been if Pat had expected to rake in money without doing a thing. She took a 3-wk vacation to France shortly after the purchase. She took 4-day weekends every week or so, to go to Kentucky. She had no interest whatsoever in the billing or coding of medical procedures, fired key employees who had been with the company for years and therefore had important connections with patients, wasn't interested in my input at all, and had very little knowledge of medicine. Nevertheless, she made broad-sweeping claims to everyone that the clinic would be better than ever under her ownership. She badmouthed me to staff and patients right from the start, saying I had committed fraud, but she knew nothing about the services the clinic offered, the needs of the patients, or billing and coding procedures. I could give more details, but in essence her "execution" was exactly that: a (planned?) (deliberate?) execution of a well-run, highly functional and greatly valued medical clinic in a rural area. As for the money she borrowed--if she had simply carried on the clinic as it had been running, with the medical director I had trained, there would have been no need to borrow money at all. The clinic could have paid its bills, and had profits left to reinvest in itself, expand, or take home. The borrowed money? I can't see where it was spent, can you?

  7. Generate 30% of the revenue with 40% more expenses for a year and a half and you could burn through some money. Revenue dropped even further in the last few months of operating.

  8. Here's how to make a business fail after you buy it:
    1. Don't show up for work.
    2. Lie to employees.
    3. Ask patients, employees and local businesses for money.
    4. Fire the experienced staff and physicians who are responsible for generating income.
    5. Tell patients that their previous doctor, whom they saw and trusted for 10 years or more, was a fraud.
    6. Use that previous doctor's DEA and other credentialing information to bill claims, which really is fraud.
    7. Make sure you learn nothing about the business or well-established protocols for taking care of patients.
    8. Reject the prior owner--after having established that good rapport and consultant help would be essential to a smooth transition. (Most physician-owners stick around for at least a year after a sale, to iron out difficulties.)
    9. Don't pay any bills.
    10.Stop paying staff.
    11.Hire people, like physician assistants, who misrepresent themselves as physicians, which is also fraud.
    12.Sell functional equipment and replace it with expensive, leased equipment that you can't afford. Don't make lease payments.
    13.Underestimate the intelligence of the patients. Act as though high-flying confidence can substitute for knowledge, skill and compassion.
    14.Ignore the requirement that to make a hands-on business work, or continue its profitability, you have to be present 16 hours a day, and be highly focused, and utilize all the staff's knowledge, for the first two years. Forget about dedication.
    15.Brag about how you "won a lawsuit against the government" and got a payout, and how successful you are at manipulating, via threats, officials in high places, in order to get what you want.
    16.Be as charming as possible, and act smart and knowledgeable, as a substitute for real smarts and knowledge, and you can snow people who want, in fact, to be snowed.
    17.Borrow money, "lose" it, and manicure the bookkeeping records to make the losses look legitimate to people who don't understand the business of medicine.
    18.Make out that the only way to profit in a rural medical clinic business is to commit fraud. Convince federal agents of this. Make sure people will feel foolish if they find out they've been duped, so that they won't admit it.

  9. Thanks for your posts, it certainly fills in some gaps. As it turns out, the willingness for creditors to fund the effort was more a testament to your success, not hers.

  10. Absolutely right. She used my success to imply that it would be a predictor of hers. (It WOULD have been a predictor of success, if she had allowed me to be involved.) But I wouldn't have needed a loan, and neither should she have needed one. For her, the loans were free money. They weren't invested in the clinic at all, nor were they likely to have been intended for that purpose.

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