Up Berry Creek without a paddle

Mountain dwellers say Oroville Hospital owes them a clinic

Photo By Tom Angel

Way up on Bald Rock Road, high above Lake Oroville and accessible only by a long, winding highway, is a steep and rutted turnoff called Townhill Drive. Just up Townhill and to the right is what’s left of the Berry Creek Health Center, which at one time provided primary and emergency care for the almost 6,000 residents spread around the mountainous hills surrounding Berry Creek.Once upon a time, the clinic patched up broken bones and kept tabs on people with chronic diseases and common ailments alike. Clinic nurses doled out shots and Band-Aids at the local school, and kids with cancer who summered at nearby Camp Okizu felt safer knowing that, even if the clinic could not help them, an airlift was available that could get them to a bigger hospital within a few minutes.

Today the clinic is deserted and collecting dust at the end of a weed-strewn gravel parking lot. Its front window is broken and boarded up. Peering through the half-closed blinds of a second window, one can see a multitude of dead wasps lying face-up on the windowsill of a former waiting room. On the front sidewalk, the feces of a wild animal marks the overgrown cement path to what used to be a doctor’s office. Circular tracks in the gravel indicate that the only regular visitors the clinic now sees are teenagers spinning donuts on what used to serve as the clinic’s emergency helipad.

The nearest medical facility is Oroville Hospital, 20 miles down a picturesque but curvy road that generally takes an ambulance 40 minutes to travel each way. When the clinic closed down two years ago, the hospital became the only health care option for the residents of the Berry Creek area. Coincidentally, the hospital also owns the Berry Creek clinic.

The residents of Berry Creek want desperately for the clinic to open again, citing an aging and chronically ill population along with a plethora of dangerous activities—such as logging, off-roading and the occasional trespasser-shooting—that take place there.

But those who are working to reopen the clinic charge that Oroville Hospital administrators, who once publicly promised to keep the clinic open or offer it back to the community, are now demanding an outrageous sum of money for a clinic the hospital bought for pennies on the dollar, left under-funded, closed without warning, then stripped of all useful equipment and left to rot.

The hospital’s side of the story is significantly different. As explained by Oroville Hospital CEO Robert Wentz, the hospital bailed the clinic out of bankruptcy and kept it on life support for a number of years, even though the people of Berry Creek did not support its operations. Wentz said he has had no offers from the community to buy back the property and restart the clinic but would like nothing more than to see the clinic operational again. He denied closing the clinic without warning and said the hospital had “more than lived up to” any promises it might have made.

To understand the story of the clinic, one has to look all the way back to 1980, the year a group of residents got serious about building a community health center. Working as ad-hoc volunteers, the group was able to coax thousands of dollars in donations of land, equipment, money and manpower out of the relatively low-income community. In December 1981, the clinic opened its doors under the direction of Intermountain Community Services Inc., a nonprofit corporation that also ran the tiny, now-defunct Feather Falls Health Clinic.

Things ran smoothly for the Berry Creek clinic for a number of years. While it never made much money, government grants slated for rural health clinics helped keep it in the black. For the residents of Berry Creek, the clinic was often literally a lifesaver.

“We got motorcycle accidents and snake bites and things that happened out in the woods,” said a former medical assistant at the clinic. “People were grateful. [One patient had] a fishhook in an eye from the lake—a guy passed out. That’s what we had.”

In addition, the clinic became something of an unofficial town hall, where people would meet in the lobby and talk about current events, catching up with neighbors who might technically reside next door yet still live miles down an unpaved road. As the only accessible health care provider between Oroville and Quincy, Berry Creek Health Clinic drew people from all over the surrounding hills, providing a sense of security and community uncommon in most small mountain towns.

But sometime around 1991, things began to change at the clinic. Dr. Claire “Bud” Williams, who had run the clinic since it opened, moved his practice to Oroville, taking many of his patients with him. Williams claims he was promised by Intermountain that he would be given the clinic if he could make it financially self-sufficient, but as soon as he did so, Intermountain reneged.

“When the federal government found that out, they pulled all their grants,” Williams said. “[The clinic] had $100,000 in the bank, and when [Intermountain] saw that, I think they just got greedy. In less than a year they had squandered all that money.”

Williams’ departure was a major blow to the clinic, but what happened next sealed its fate. While there are only a few fragments of court testimony and the fading memories of former employees and board members left to tell the story, the most common explanation offered for the clinic’s downfall is that an administrator hired to fill the shoes of Dr. Williams mismanaged it to the point of bankruptcy.

In interviews both for and not for attribution, former Intermountain board members and employees said that administrator Cathy Keefer, along with Dr. Robert Illa, whom Keefer hired, spent the clinic’s money on trips to conferences, large salaries and other perks while the clinic bled to death financially. According to former board member Sue Stagg, along with others who spoke confidentially, Keefer and Illa were having a love affair on company time.

When asked if she believed the doctor had taken the clinic for a ride, Stagg answered, “Like a roller-coaster.”

Another former board member, Virginia Veekamp, summed up the problems at the clinic by saying, “I think they tried to get too big too fast. There was a doctor there who wanted the world, and they tried to provide it.”

The allegations of mismanagement became public when a former clinic bookkeeper sued Intermountain for wrongful termination, alleging that Keefer had fired her because she had questioned some of the clinic’s spending practices. The suit, filed by Nancy Edmonson, alleges a “personal relationship” between Keefer and Illa, along with the claim that Keefer indulged in “the wrongful use of vouchers and claims” and “told [Edmonson] to remain silent concerning her charges or she would be terminated.”

UP THE DOWN STAIRCASE Former Intermountain board member Lisa Hubacek descends the stairs that once led to her doctor’s office.

Photo By Tom Angel

Keefer, who still lives in Berry Creek, did not return a call for comment, and Illa could not be reached.

The consequences of all this intrigue were that Edmonson lost her lawsuit, Keefer lost her job, Illa moved on and Berry Creek looked like it would lose its clinic. According to one former board member, by the end of 1992 the clinic had gone through all of its grant money, was behind in collections and at one point was trying to figure out how to buy three months’ worth of medicine with less than $15—all that was left in the clinic’s drug fund.

Enter Robert Wentz, CEO of Oroville Hospital, widely known Butte County businessman and would-be rescuer of Berry Creek Health Center. At a town hall meeting held in November 1992, Wentz laid out his plan to save the clinic. According to news reports of the meeting, he offered to lend the clinic $50,000 over a five-month period, which the clinic would then default on, making the hospital the new owner. He also promised the roughly 70 people at that meeting that “if for some reason the hospital is unable or unwilling to maintain the clinic, we will be offering that clinic back to them.”

When asked about the account recently, Wentz didn’t deny making the promise, though he insisted that the hospital had so far kept its part of the bargain.

“I think we in fact did keep it open for a long time, even with the lack of support it was getting from the community,” he said. “We made it very clear that this was not working. … I think Oroville Hospital did more than what was called for in regard to keeping that clinic open. It was not making money for, actually, many years.”

When asked about the loan, however, Wentz inexplicably denied offering the clinic a loan of any kind, much less trying to take it over by pre-planning for the clinic to default.

Wentz’s denial of the loan offer contradicts the accounts of every board member and employee interviewed for this article. At least five separate news reports from that time period attribute the $50,000 offer to Wentz himself. Published reports also quote several Intermountain board members who were aware of the plan, including a story from the Oroville-Mercury Register in which Clinic Board Chairman Paul McKillop confirms that “he expects the struggling health centers to default on the loan and turn their operation over to the hospital.”

When Wentz was first interviewed, sources for this story were under the assumption that any copies of the loan contract had been either lost or destroyed. But the day before the story went to press, a copy of the contract was found. When the CN&R again called Wentz, he said he had “no recollection” of making the loan but conceded that it could have happened. He also said OroHealth would never lend money to an entity that had no means or intention of paying it back.

“I can see us loaning money if they wanted to continue the operation,” he said. “We would never loan money if they planned to default on it. Why would we do that? I cease to understand how loaning money is going to precipitate bankruptcy. Not loaning money, if they didn’t have any money as you say, that would mean that they were bankrupt right then.”

The unsigned contract makes no mention of any plan to default on the loan. It does include a right of first refusal that, on the surface, guarantees that if the clinic were to close within 10 years of the takeover, Intermountain would have the option to buy it back for the amount of the loan. However, the agreement also makes OroHealth the sole surviving member of Intermountain’s Board of Directors.

While still maintaining he did not remember the offer, Wentz said, after hearing some its terms, that it “sounds like a good deal. If they wanted to give it a try and we said, ‘Look, we’ll give you a loan for the $50,000, but you’ll have to secure it against the clinic,’ I think that would be a good arrangement because they would probably be losing the clinic anyway.”

Wentz maintains the hospital’s takeover of the clinic was done for altruistic reasons, but there are those who were suspicious of Wentz in the first place and who now say it was a mistake to allow him to take it over.

Lisa Hubacek is a self-described “reformed city girl” who moved up to Berry Creek with her postman husband in 1988. After doing battle as a union steward for postal workers and engaging in various other activist causes for much of her life, she promised herself when she moved to the mountains that she would stay out of politics.

Within a few years, she had broken that promise.

Hubacek found herself drawn into the clinic saga when a nurse there tipped her off to some of the aforementioned management problems. Realizing the worth of the clinic to the community and knowing that she had the administrative skills to help, Hubacek convinced the reluctant and skeptical Intermountain board to take her on as a member.

This put her squarely on the tracks of a freight train named Bob Wentz. The first time she met Wentz, Hubacek said, he was offering the board the loan contract he now says he doesn’t remember making.

“The first meeting we had with [Wentz] is when he brought in an over-90-page contract and just wanted us to sign it, without reading it,” Hubacek said. “He said, ‘Don’t worry, our lawyers looked it over.’ We didn’t want to do that—well, some of us didn’t. Some of us were just going to sign it.”

Hubacek said she made an innocuous joke about getting an unwanted set of encyclopedias as a result of signing documents without reading them. To that remark, she said, Wentz reacted angrily.

GET ON BOARD Left to right: Catherine Conrad, former clinic medical assistant; current Berry Creek Rural Health Care board members Pam Donahue (center) and Herma Barber.

Photo By Tom Angel

“At this point he whipped around and said, ‘Are you calling me an encyclopedia salesman?'” she said.

Hubacek’s relationship with Wentz didn’t much improve when she questioned his interest in the clinic. While some of her fellow board members were happy to give Wentz the keys and be done with it, Hubacek and some other concerned Berry Creek residents were wary of Oroville Hospital’s offer and wanted to make sure the clinic would stay open.

“Our position was that [Wentz] just wanted to buy the clinic, get the land, get the building, close it, use for something else,” Hubacek said.

Her suspicions were reinforced both by the terms of the turnover and the way it was presented.

“It was, ‘This is how we have to do it: We have to loan you money, you have to default on the loan, and then we take over the health center.’ The details of that we wanted to work out because we owned the land outright, we owned the building outright, … there was an X-ray machine, all sorts of things, that all belonged to us.

“I never thought it was actually illegal, but I did think it seemed odd. He said he would loan us $50,000 with $10,000-a-month payments at 9 percent interest. But he knew—we knew—we couldn’t pay it back.”

Hoping that the community could someday buy back the clinic, Hubacek said she asked Wentz why, if the loan was to be defaulted on anyway, didn’t he lend the clinic a more manageable sum, like $20,000? She claims she was told that the hospital’s lawyers wanted the payments to drag out for a period of at least five months so that pending lawsuits—both the one Nancy Edmonson had filed and another filed by Dr. Williams—could run their course.

When the board voted on whether to turn the clinic over to the hospital, Hubacek abstained, and the proposal passed. She is unclear on what happened afterward, as her mother died during that period and she experienced some health problems that kept her out of the loop. If any contract between Wentz and the board was signed, no one today knows where it went.

In the end, Oroville Hospital did take over the clinic. When the clinic declared bankruptcy in February 1993, it was put into a receivership, which kept it open until it could be auctioned off on the steps of the county courthouse. There was only one bidder—OroHealth, the nonprofit company that owns Oroville Hospital.

Bob Wentz, true to his word, kept the clinic open—for a while. Using doctors and administrators from the hospital and, just as it had before, contracting lab, X-ray and pharmaceutical services to the hospital, OroHealth ran the clinic from December 1993 until July 12, 2002. During that time, Wentz said recently, the hospital sank thousands of dollars into the clinic to repay old loans and keep the place running.

When asked how much the hospital invested, Wentz said, “I don’t know—a lot. Well in excess of $100,000.” In past news articles, Wentz claimed to have invested more than $200,000 in the clinic.

There were few, if any, documented complaints about the clinic during the time it was run by OroHealth. But, Wentz said, there were also few patients. Wentz said the clinic would have had to see around 25 patients a day in order to remain viable. Instead, he said, it saw only about five people per day.

“The problem [was] that the clinic [was] not being used. What’s compelling about keeping open a clinic that’s not being used? Is that a prudent use of resources? Health care is expensive enough without subsidizing a clinic that is not being used.”

Although Wentz said he warned “for years” that the clinic would be closed if it didn’t stop losing money, the people of Berry Creek never got that message. The only warning the hospital is known to have given were letters sent to some clinic patients stating that the clinic would close July 15. Those letters, dated July 9—the day news reports of the closing surfaced—are postmarked July 16.

When the clinic closed, it took most in the community completely by surprise. In fact, they might not have found out at all if clinic nurse Betty Baltzley hadn’t spilled the beans to the media. Catherine Conrad, a former medical assistant who now works at Wal-Mart, said the clinic’s closing surprised employees and patients alike.

“They just walked in, [Oroville hospital administrator Holly Edwardson] walked over to me and said, ‘We’re shutting these doors,'” Conrad said. “Patient abandonment is what happened here.”

Suddenly, it became part of Conrad’s job to tell clinic patients they would have to look eslsewhere for medical care.

“There were people calling to reschedule appointments, and I had to say, ‘Oh, by the way…’ You know how embarrassing that was? I had people screaming at me all day.”

PROMISES, PROMISES OroHealth CEO Robert Wentz, as he appeared in a TV news segment from 1991, explains to Berry Creek residents the terms of OroHealth’s offer to take over Berry Creek’s clinic.

Photo By Tom Angel

Many patients, Conrad said, had trouble getting their medical records.

“The hospital was extremely belligerent about the fact that our patients were going down to try and seek their medical records and they were locked up. They were not able to be accessed without a great deal of hassle.

"[Patients] have to pay $10 for the first page, 25 cents for the next page—it can be well up into the hundreds of dollars. … If they’re not getting a physician that can pick them up right away, they’re going to have to pay out of pocket. We had people irate, demanding their records, and the hospital was not responding or at all working with us.”

While Wentz maintains the people of Berry Creek were given plenty of notice of the closure, his account again contradicts news accounts of the day as well as former board members and employees like Conrad, who added, “There are people to this day that still don’t think [the clinic] is closed.”

A few months ago, the road signs directing motorists to emergency medical services in Berry Creek were finally taken down.

Since July 2002, the clinic has sat empty, waiting either to be reopened or sold. During that time, a group of Berry Creek residents has been working on putting together a nonprofit corporation to get the clinic back and running again. But, they say, it has been an uphill struggle. Infighting and old feuds among certain Berry Creek residents have made it hard to form a board of directors. The terrain and relative lack of media coverage in the hills makes it hard to keep people informed. But the biggest hurdle, the group claims, has been Bob Wentz.

Pam Donahue and Herma Barber are the most visible members of Berry Creek Rural Health Care, the small group fighting to reopen the clinic. Donahue serves as publicity coordinator, while Barber is the CEO and chairperson of the Board of Directors.

Donahue and Barber said Wentz offered to sell back the clinic to them for $80,000. The trouble is, they said, the building has been stripped of all medical equipment, save for an X-Ray machine that is so old it is considered a biohazard.

“He is not selling a clinic to us, he’s selling us a dilapidated building,” Donahue complained. “We’re not paying $80,000 for a dilapidated building. We want to buy the clinic as a clinic, as we were promised. He’s already backed off what the deal was in the first place, which was for $80,000 we’d buy a clinic.”

Wentz said he has had no offers for the property, either as a clinic or anything else. He did say he’s had “many discussions” with folks in Berry Creek, but that it was hard to tell if those he’s talked to were serious about running a clinic or if they just wanted to buy the property on the cheap.

“I have no way to know,” he said. “It doesn’t appear that anyone I’ve talked to has any background at all or has any knowledge or experience in running a clinic. I don’t know if they’ve represented that to you. It’s going to be a little tricky to run, and I don’t see how they’re going to do it.

Donahue admitted that no one on the board has ever run a clinic before but said that her committee was interested only in setting up the clinic and helping to oversee it. One of the first board actions, she said, would be to hire an experienced administrator. The committee also has some ideas on how to keep the place afloat.

“A new board will be elected every year,” she said. “If the clinic is being run right, then the people of Berry Creek will elect a new board. We will have grants, and we will hire doctors that have to pay back their grants, so that will cut down our cost on doctors.”

Donahue said the board also plans to add more types of services, such as dental care and mental-health counseling, so that different types of grants can be secured.

But all that hinges on whether the group can figure out a way to buy the property back and stock it as a clinic. Right now, they say, negotiations with the hospital are at a standstill and folks in Berry Creek are getting mixed messages as to what is going on.

Wentz said that isn’t his fault, and that he is still committed to the idea of a clinic operating in Berry Creek.

“I’ve had numerous meetings with a couple of different people, but I can’t tell if they really represent the community. If someone wanted to purchase the building for the purpose of running a clinic that would certainly be preferable to us, rather than just selling it as real estate.”

Donahue hopes the committee can clear things up and enlist community support at a town hall meeting scheduled tentatively for August 29. But as Barber pointed out, the community, which once teamed up to start the clinic, may not be so willing this time. After all that has happened, the people of Berry Creek may just be too jaded and divided to pick up the pieces of their little clinic.

“What can we tell them—the same old thing?" Barber asked. "We need $80,000 for Wentz to give us the building. He won’t sell for less."