A new Dayton Daily News investigation reveals how Kettering Health provided $3.2 million in excess benefits to hospital executives, leaders of the Seventh-Day Adventist Church, and their families.
WYSO’s Jerry Kenney spoke with Josh Sweigart, Dayton Daily News editor of investigations, to learn more.
This transcript has been lightly edited for clarity.
Jerry Kenney: Josh, thanks for speaking with us. This is a pretty important story and my understanding; it's been in the works for quite a while. The investigation stems from an internal audit that Kettering Health did in 2023.
Josh Sweigart: Yes, so in 2023, Kettering Health completed an internal audit that followed concerns and allegations that had been voiced previously about spending at Kettering Health, the hospital network. Theyd announced in 2023 that their internal review was completed, but there were no details provided at that time about the scope of what they found, how many people were involved, the dollar amount. They said that the investigation looked into, "allegations of inappropriate fiscal and operational management at Kettering Health." And at the conclusion of their audit, they said that they made changes to keep personnel, policy, and governance structure. What they didn't announce was the substance of their findings, who was involved, how many people, what dollar amount. And so that's what we've been able to obtain records that shed light on that information.
Kenney: You've been looking into this for a while. I imagine it's taken some time to get a hold of the tax documents you needed to get to look into this.
Sweigart: Yeah, so the documents are filed as an amended file to a previous filing. So long after 2022, they filed an amended 2022 tax filing, which to get into the weeds included something called a Schedule L, which is where a non-profit would have to notify the IRS of any quote unquote excess benefits, which was money paid out to people who should not have received it or funds or benefits provided to people who either shouldn't receive it or that was received in excess of the services provided by those people to that organization. We were able to obtain other documents also that provide a little bit more detail than what's publicly accessible, that shed light on some of the specific expenditures. So the tax documents get into the dollar amount, $3.2 million in excess benefits provided to 46 current and former hospital executives and officials with the Seventh-day Adventist Church. That information is in the accessible tax filings we were able to obtain. Additional records we obtained provided a little more detail about the nature of those benefits. That included expenses to decorate at executive's homes, to take trips to Paris and Rome, a whale watching trip in Maui, some of the details about how the funds were expended and what some of these excess benefits consisted of that came in documents we were able to obtain.
Kenney: I understand there's a state investigation that's still taking place?
Sweigart: The Ohio Attorney General's office would not comment on the investigation, but Kettering Health made it clear that they are cooperating in an ongoing attorney general's office investigation. And so there are people who are looking forward to finding out what the outcome of that's going to be.
Kenney: What else did you hear from Kettering?
Sweigart: I mean, Kettering Health emphasized that they conducted an internal investigation in 2023. They emphasized that the made changes following that investigation to their staffing, to their governance structure, to their policies, and that individuals implicated in this are no longer with the organization, is what they said. They made it clear that they're cooperating with the Attorney General's Office investigation. Similar comment came from the Seventh-day Adventist Church. Many of their leaders are also referenced in these tax documents as receiving excess benefits from the hospital. As many people are aware, the Seventh-day Adventist Church is ingrained with Kettering Health in the management and a lot of the leaders at Kettering Health are affiliated strong with the SDA Church and the SDA Church appoints board members to the Kettering Health board. I mean, Kettering Health is an Adventist hospital network that has been since its inception.
Kenney: Let's just do what want to highlight about this article?
Sweigart: There is a lot of detail in the story. It's on our website at DaytonDailyNews.com. We do have a full list of all 46 individuals who are named in the tax documents. Perhaps worth noting is that Kettering Health points to the fact that a majority of those who are reported as receiving excess benefits have corrected that, which generally means they paid it back.
There are several individuals who are reported at this point as not paying it back, including Fred and Mary Kay Manchur, the former CEO of Kettering Health and his wife. They, according to the tax documents, received about $1.5 million in excess benefits, which is the largest out of the entire list. They are listed as not having paid anything back. There are a couple other people who've allegedly, at this point, not paid anything back according to the hospital network. All that information is in our story and on our website.
