CHARLOTTE, NC (WBTV) - The North Carolina Department of Health and Human Services has transitioned leadership and governance of Cardinal Innovations to the new board and to the Cardinal Innovations executive leadership team.
The decision came Saturday at the board meeting in Winston-Salem.
DHHS has been on site at Cardinal since Nov. supervising the operations of the agency and working with interim leadership to develop a formal Corrective Action Plan that addresses various issues at Cardinal that were identified in recent audits and oversight activities.
In Oct 2017, an auditor criticized Cardinal for severance packages that ran too long, for 10 employees other than the CEO.
Then, after the agency fired CEO Richard Topping, his severance package reportedly totaled $1.7 million.
A review found that four of seven similar quasi-government groups, including Cardinal, offer severance packages. Three do not offer payouts at all.
In addition, Cardinal's severance packages range from 24 to 36 months, while the similar entities cap out severance pay at a year.
In Nov., DHHS secretary Mandy Cohen wrote in a letter, that the department "..has concluded we can no longer rely on the Board and executive leadership at Cardinal Innovations to bring Cardinal into compliance with its legal requirements."
DHHS demanded Cardinal to repay money spent on excessive severance packages, saying it must come from administrative funds, not funds that would have otherwise gone to patient care.
"I feel confident that the new board and leadership team of Cardinal Innovations will keep its focus on the patients and consumers they serve," said Cohen.
The new board was appointed in December by Boards of Commissioners in the counties served by Cardinal.
The official board meeting follows training sessions that DHHS led to provide information on Cardinal, the new board's responsibilities and the department's expectations for the LME/MCO which serves 20 central North Carolina counties.