Following the 2017 Gonzales County EMS scandal in which Emergency Medical Services Board Administrators were arrested for mismanagement of EMS funds and indicted by a grand jury, Gonzales Emergency Services District #1 supplied a status update to the Commissioner’s Court regarding the progress of changes made in the restructuring of EMS and ESD. This update precedes an audit of the department in September.
“First thing I wanna say is that the EMS is doing pretty good these days,” ESD president Rene de la Garza said. “As you all know, we had some poor management a couple years ago and it all came to light, and since we took over we’ve changed the way things run. It’s not a 501c-3 anymore, we’ve turned it into a government agency. Now, the reason in my opinion it got to its state is because some of the board members were there for 30, 40 years and they become complacent.”
“You trust your people, and I feel like the Commission, I’d like to recommend that y’all pay attention to that in the future, that you don’t let any of us stay on there for 20 or 30 years. It could happen again. I’d rather try to avoid it. We have two-year terms, you can appoint us as many times as you want, we have a great board right now.”
De la Garza asked that the County Commission be mindful of avoiding a similar situation in making future appointments to the EMS board. ESD Treasurer Donald Rihn gave a description of the financial discrepancies which led to the discovery of the scandal, as well as what methods are being used to manage EMS funds currently. In January of 2018, EMS came under investigation by the Texas Rangers, who arrested Carla and James Russel for the mismanagement of these funds.
“We had been receiving financial statements each month that had been approved by the EMS board before we got them,” Rihn said. “We never had anyone think any problem or point out financial problems, shortage of money, they needed more money, or anything like that at all. We were alerted by the Texas Rangers that we best start looking at something, and they gave us a hint. It still hadn’t been disclosed or any of that, and the rest of it’s all been in the paper. We started watching the finances— I started watching— and found out that they had three sets of books.”
“We had financial statements, generated, given to us, approved by the board, they had another person, an accountant that did their bookkeeping, provided financial statements there, and then they also had a computer in there with all the checks written and all the income coming in and everything’s balanced. When we took it over, we used a CPA firm out of Seguin, they reconciled the bank balance, and I think it was off 20 million dollars.”
Rihn said that the accounts hadn’t been shorted this amount, it had just never been found, and no one could “reconcile anything.” He also said that there were “serious cash problems,” that weren’t indicated by any statements that the ESD board had been receiving.
“Overall, we have had to give $342,000 in additional funds from the time of the investigation, up until 2019 when we really started taking over everything,” Rihn said. “The biggest cash problem was that they were $97,000 in past due payroll taxes. That’s four-and-a-half months of payroll taxes. You go to jail for that.”
The ESD board, Rihn said, advised the then-EMS board to do something about this problem, and because of mismanagement of the EMS account, also had to “bail them out” although ESD did not cover any penalties or interest. Rihn said the involvement of the CPA firm as well as the investigation wiped the penalties and interest from the slate, effectively “getting them out” of being required to pay “many thousands of dollars.”
Almost three years after the investigations began, the EMS operating account is being watched over by Rihn, who said the reserve account is at $651,000. Expenses incurred by EMS-ESD includes $11,000 in legal fees from the investigation and restructuring of Gonzales County EMS. EMS, as of September 30, 2020, will be under full jurisdiction of ESD #1. Rihn said EMS is still collecting funds to cover any claims which need to be paid back to insurers or Medicare/Medicaid. This will be transferred to GESD at a later date. In September, Rihn said the reserve account is estimated to be around $800,000. Including the cost of updates to Gonzales County EMS, the department is operating with zero debt, Rihn said.
Updates which have been made to Gonzales EMS include four new ambulances, one at each EMS station in the county, to ensure that care is both high quality and equal across the board. There have also been additional programs entered by EMS, such as offering whole blood and a partnership between PHI Air. EMS Director Eddie Callender said the hiring process for EMS staff has also been improved.
“In the last year or so from an operations side I would say we’ve changed the culture of the local EMS,” Callender said. “We look different, we act different, we participate differently, and we’re much more part of the overall healthcare system than we were at one time. We’ve tightened up the rules and regulations on our personnel and we’ve implemented pre-employment drug and physical fitness for duty testing. Anybody that comes to work for us has to go through an intensive program in which they have to demonstrate the ability to lift and move and climb steps, that type of thing. We also do random drug testing, sometimes about every quarter.”
Callender said the new ambulances acquired by EMS are not only of identical quality ensuring all residents of the county receive equal care, they are also identical in internal layout, with employees being rotated between all stations.
“That means all parts of the county are being treated the same, everybody has the same assets no matter which ambulance they have,” Callender said.