If this were poker, it would be a stacking-the-deck controversy.

Questions are swirling at the Statehouse whether Kansas University Provost Richard Lariviere has been illegally appointed to serve on the KU Hospital Authority Board during a time when the board is wading into controversial negotiations regarding a proposed affiliation between KU Medical Center and St. Luke’s Hospital in Kansas City, Mo.

Senate Majority Leader Derek Schmidt, R-Independence, said the questions surrounding the board, which oversees an annual budget of more than half a billion dollars, are troubling.

He said he’s contemplating requesting a legal opinion from the attorney general regarding the Lariviere issue, and what legal requirements Gov. Kathleen Sebelius must follow when making appointments to the board.

“We have to get an answer to these legal questions,” Schmidt said.

Lariviere in December was appointed as an ex officio voting member of the board of the Kansas City, Kan., hospital. Ex officio members serve on the board based upon their jobs within the KU system. The state statute creating the hospital board lists six ex officio positions on the board. But neither of Lariviere’s two positions – KU provost and executive vice chancellor of the university – is listed.

Instead, the statute lists the KU chancellor, executive vice chancellor of KUMC, executive dean of the KU School of Medicine, chief of staff of the KU Hospital medical staff, president of the KU Hospital Authority and dean of the KU School of Nursing.

House Speaker Melvin Neufeld, R-Ingalls, said Lariviere doesn’t have the legal authority to serve on the board as an ex officio member. He said the fact Lariviere is on the board is a sign that an effort is under way to “stack” the board in a manner that will give more control of the hospital’s financial resources to KU Chancellor Robert Hemenway and his staff.

“I think this is basically being driven by some of the charitable folks in the Kansas City area who are much more concerned about building a research center that gives Kansas City a big name than maintaining the quality of medical education for Kansas,” Neufeld said. “It is more of a regional group that wants to be multistate and make the university multistate instead of making the university the best medical education facility in the country to serve Kansas.”

Neufeld said the governor has gone along with the efforts. He said the hospital’s financial reserves are attractive to members of KUMC who want to be part of building new research facilities.

Neufeld said he’s not against promoting additional research, but is concerned that if revenues are “stripped” from the hospital that it may not have the resources to build additional treatment and educational facilities.

“We would like to see an expansion of research, too, but we’re not willing to sacrifice medical education in the name of research,” Neufeld said.

Governor’s response

Nicole Corcoran, Sebelius’ press secretary, declined to specifically comment on Neufeld’s allegations.

Corcoran, though, said the governor did not directly appoint Lariviere to the board. The statute does not call for the governor to appoint ex officio members. Instead, the governor was simply notified via a letter from the hospital board that Lariviere was now serving as an ex officio member in the “executive vice chancellor” position.

As for whether the statute allows Lariviere to serve as an ex officio member, the governor is taking a hands-off approach. Corcoran said because the governor is not responsible for appointing ex officio members, she has accepted in good faith the judgment of the KU Hospital board that Lariviere is eligible to serve in the position. Unlike all other appointments to the board, ex officio members are not subject to Senate confirmation.

Dennis McCulloch, director of public and government relations for KU Hospital, confirmed that George Farha, chairman of the board, sent a letter to Sebelius notifying her that Lariviere was now filling an ex officio position. But McCulloch said Lariviere was placed on the board because Sebelius had requested it.

There was one open ex officio position because Barbara Atkinson has two of the six positions listed in the statute. She is both executive vice chancellor of KUMC and executive dean of the KU School of Medicine.

Corcoran declined to specifically comment on whether the governor requested Lariviere to be on the board. Corcoran did say that the governor met with members of the hospital leadership in 2006, and did discuss individuals who may be interested in serving on the board.

McCulloch said the board is no longer certain that the Lariviere appointment was appropriate.

“Subsequent to inquires, the board is reviewing whether this position meets the requirements of the statute,” McCulloch said.

Other appointments

The Lariviere position is not the only one in question on the 19-member board. Neufeld and Schmidt both have expressed concerns about how at least five other nominations are being handled by the governor.

There are five positions on the board that Sebelius has been asked by the hospital board’s nominating committee to fill. In 2006, the hospital board submitted nominees to Sebelius for the five positions. But McCulloch said Sebelius asked the board to withdraw the names and replace them with individuals she was interested in appointing. McCulloch said that included Lt. Gov. Mark Parkinson and Bob Regnier, a Johnson County banker.

McCulloch said the board agreed to withdraw the names in an effort to create good will with the governor.

“The board was looking for support from the governor and others to create a win-win-win situation with the affiliation negotiations and was hoping that cooperation would lead to achieving that goal,” McCulloch said.

Schmidt said he’s not convinced the governor has handled the nomination process appropriately. Whether the governor acted properly is in question, he said, because the statute says the governor “shall” appoint members from the list of nominees given to her by the board’s nominating committee.

Schmidt said a review of the governor’s handling of the nominations would be part of any attorney general opinion that he may seek.

Neufeld said the governor’s handling of the nominations is further evidence that she is trying to stack the board.

“I think the question here is, philosophically, do you want the chancellor to run the hospital?” Neufeld asked. “That is the direction the governor is heading with this.”

Neufeld said Kansans should be concerned with that prospect because the hospital was in well-documented financial trouble when the university was last in direct control of it. The hospital board was created in 1998 as a means to allow the hospital to operate independently from the university.

“If you stack the board with people from the chancellor’s office, you’ll have happen what happened previously – the hospital was raided for its assets and became bankrupt, or virtually bankrupt,” Neufeld said.

New nominees

The governor now has a new set of nominees to consider for the five positions. Another slate of five names was submitted to the governor in December: Farha, Robert Honse, former state legislator David Kerr, Robert Regnier and Parkinson, the lieutenant governor. All but Regnier are past board members.

But the governor has not acted on that slate of nominees either. Corcoran said there is a good reason. She said the state statute requires the board’s nomination committee to submit at least two and no more than three names for each position. Corcoran said the board should have submitted at least 10 names to give the governor the required number of choices.

Corcoran also said the governor is hesitant to make any changes to the board because it is actively involved in negotiations regarding its affiliation with KUMC. The hospital board also is monitoring affiliation discussions between KUMC and St. Luke’s Hospital.

McCulloch said the board disagrees with the governor’s interpretation of the statute. He said two names were submitted for each of the five seats on the board. He said some individuals were nominated for more than one position, a practice deemed acceptable by the governor until last year.

Defining what the governor can and can’t do when appointing members to the board will be an important issue because there is a backlog of appointments to be made. Of the 13 members who are appointed by the governor, eight of them are serving past the expiration date of their terms.

The state statute allows for members to serve past their term’s expiration date if no one else has been appointed by the governor and confirmed by the Senate.

Who’s on?

Another haze hanging over the hospital is a disagreement among the board and the governor’s office about who actually serves on the board. The governor contends that Parkinson is still a member of the board.

But McCulloch said Parkinson submitted his resignation, and the board accepted it, in June 2006. Parkinson confirmed that he submitted a resignation letter to the board, but the governor contends that because the resignation letter was never forwarded to her office, Parkinson still serves on the board.

McCulloch said the hospital’s leadership does not agree.

“Neither the statute nor the authority’s bylaws requires that resignations of directors be forwarded to the governor,” McCulloch said. “Previous board members have resigned, and Mark Parkinson’s resignation was no different.”

Parkinson has attended one board meeting since submitting the resignation letter. He did address the board as a guest but did not vote, McCulloch said.

Schmidt said he would ask the attorney general to review the Parkinson situation as part of any attorney general opinion that he may request. Schmidt also said he wants clarification about what role Regnier is allowed to play on the board. Regnier is one of the five names forwarded to Sebelius to fill a seat on the board.

McCulloch said Regnier has been attending board meetings, and has been allowed to go into closed-door executive sessions that are closed to the public. He has not been allowed to vote on matters, though.

Because Regnier has not been officially appointed by the governor nor confirmed by the Senate, Schmidt said he had questions about how much he should be allowed to participate in board activities.

Schmidt – who as Senate majority leader oversees the confirmation process in the Senate – said all the questions involving the board will have to be answered before the Senate takes up the nominations.

“We’re not going to take any actions on nominees until we know they have been lawfully submitted,” Schmidt said.