published Tuesday, August 30th, 2011

Erlanger defends bid process after awarding Ritz-Carlton $288,000 contract

by Chris Carroll


Erlanger says it will spend up to $500,000 on Ritz-Carlton for customer service training sessions. Here is the breakdown:

  • $35,000 -- Initial trip for Ritz-Carlton representative
  • $65,000 -- Other preliminary expenses
  • $288,000 -- Training sessions scheduled for October
  • $112,000 -- Allocated for optional future sessions

Source: Erlanger Health System

Erlanger Health System spent at least $35,000 on Ritz-Carlton before it awarded the hospitality chain a $288,000 contract to provide customer service instruction at the public hospital, officials said Monday.

The hospital initially branded all Ritz-Carlton expenses as a lump sum for training and implementation. Instead, a $35,000 contract paid a Ritz-Carlton corporate university representative for a 2 1/2 day preliminary trip to Erlanger.

The trip included a meeting with top Erlanger executives, four sessions with a 45-member hospital team and tours that illustrated daily operations at Erlanger -- all of which made Ritz-Carlton's program "distinctively Erlanger's," according to a hospital news release.

The hospital spent about $65,000 on other expenses as the hospital decided on Ritz-Carlton, Chief Nursing Officer Lynn Whisman said, but she didn't have exact details on how the money was spent.

Had Erlanger officials decided against Ritz-Carlton, "we'd have [lost] $100,000," she said.

Two other hospitality consulting companies vied for the Erlanger contract, but there was no bid process for customer-service sessions that could end up costing taxpayers $500,000 if Erlanger decides to bring Ritz-Carlton back for future educational sessions.

Erlanger officials defended the no-bid procedure Monday, saying the hospital was correct in bypassing a competitive bid process and awarding a "professional services" contract to Ritz-Carlton.

"Tennessee law says government entities do not have to bid professional services," hospital spokeswoman Susan Sawyer said.

Even early in the process, Whisman said, "it was so clearly the Ritz going forward."

"There was a lot of board support, executive-level support and steering committee support," she said. "Ritz had it all."

Erlanger did not provide the other two companies' proposed prices. The Times Free Press submitted a public records request for copies of the Ritz-Carlton contracts and, by law, the hospital has about a week to respond.

In October, a Ritz-Carlton speaker is expected to lead several four-hour sessions, each of which will hold 400 employees, hospital officials said.

The bill for those sessions is $288,000. On Thursday, Sawyer said Ritz-Carlton prohibited the media from attending the sessions because of proprietary information the hotel chain prefers to keep secret.

Erlanger's publicly appointed board of trustees approved the Ritz-Carlton contracts this year, along with an optional $112,000 for future customer service sessions that would cater to doctors. Trustees lobbied hard for the sessions, citing a need for "service excellence."

Data appears to substantiate their concerns.

According to statistics compiled by the U.S. Department of Health and Human Services, Erlanger lags a few percentage points behind Tennessee's average patient satisfaction rates in nine out of 10 quality measures tracked by the government.

Among other categories, the measures explore whether nurses always communicated well with patients and whether rooms and bathrooms were always clean -- a category in which Erlanger fell 10 points behind the state average of 72 percent satisfaction.

By comparison, Memorial Health System and Parkridge Medical Center, Chattanooga's major private hospitals, finished tied with or ahead of state and national averages in all 10 quality measures.

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harrystatel said...

"The hospital spent about $65,000 on other expenses as the hospital decided on Ritz-Carlton, Chief Nursing Officer Lynn Whisman said, but she didn't have exact details on how the money was spent."

Perhaps Ms. Whisman can apply to be the head of The Multicultural Chamber of Commerce as it appears Ms. Whisman went to the "Sherrie Gilchrist School for Financial Accountability."

August 30, 2011 at 6:16 a.m.
eastridge8 said...

Good one harrystatel...and payingattention...

just telling it as we see it, Erlanger.You have MAJOR problems in your EMPLOYEES treatment of might want to look into actually hiring better-trained individuals...instead of someone barely out of HS whose aunt/mother/cousin/uncle/brother works there.

August 30, 2011 at 9:53 a.m.
sandyonsignal said...

It looks like Erlanger and their Board cares more about the sizzle and so little steak. I hope the Times Free Press does a follow up article on the two hospitals who submitted bids. It will be telling and a reason for an overhaul of the board, if the hospitals named were: Mayo Clinic, Cleveland Clinic or M.D. ANderson Cancer Center. All three of these hospitals are world renowned. Sheiks, Senators, movie stars, rock stars and the average Joe go to these hospitals for care and treatment. No one gets mocked or ridiculed. No one goes to the Ritz for their care.

The last article TFP wrote about Erlanger hiring Ritz-Carlton, had several interesting comments from readers. Many complained about the rudeness there. That is a management problem and will not be solved by throwing away $500k to consultants. When a nurse tells a patient in labor to shut up and get over herself, that nurse should not be in the caregiving business. Memorial, Park Ridge or East Ridge wouldn't have people like that. Why does Erlanger? It says more about how poor their morale is and why would anyone with a choice go there? How is the Ritz going to fix that? For $500,000, I am sure they are telling Erlanger they will. If the other two hospitals who offered to help heard the stories, they would probably say to scrap the Board and upper management. That is probably why Fisher and Brexler don't want to use them.

August 30, 2011 at 1:42 p.m.
g8orfan64 said...

I would like for Mr. Carroll or his editors to explain how this can potentially cost taxpayers $500,000. Please Mr. Carroll, explain.

The fact of the matter is it isn't, yet this paper continues to print in yellow ink.

If this paper wants to be taken seriously, possibly they should start reporting facts and leave the commentary to the rag publications.

I am sure a few people out there believe what you print, but that I pray is a minority.

My suggestion is start reporting the news and quit fabricating stories.

August 30, 2011 at 3:24 p.m.
sandyonsignal said...

G8orfan64, the breakdown is in the grey box. Adds up to $500k and the source came from Erlanger itself. What is there to dispute?

August 30, 2011 at 3:54 p.m.
sandyonsignal said...

Top hats and tails will replace the scrubs. White gloves instead of latex. Oh so glad they paid $500 K for this. I suspect a kickback, too. When we find Erlanger at the bottom of the heap for hospitals in America, heads should roll over this decision. Too bad we have to wait so long to be rid of this inept and idiotic group.

August 30, 2011 at 5:17 p.m.
g8orfan64 said...


The fact is no tax payer dollars are paying for this.

The county and city contribute to Erlanger to help compensate them for uncompensated care. I don't think the city is giving any money this year, so Erlanger get's $1.5 million in taxpayer money to keep you from seeing people with broken legs laying out on the public streets since some hospitals seem reluctant to take "non-payers" unless they are really pressed in to service.

I don't work for Erlanger, and never have, but am smart enough to know every public dollar sent to them is more than paid back in service to the public's health, yet this "newspaper" seems to think every move is under their domain.

IMO I think the paper seeks to extort "public money" from Erlanger in the way of advertising. Start advertising and all of a sudden the print color will change from yellow to black. But, that's just my opinion.

Wake up Sandy.

I still want Mr. Carroll to explain how this is costing the taxpayers a potential $500,000...and to be fair, I think the paper needs to examine how much money is lost by admitting the number of non-payers Erlanger does.

I think a better story would be to examine how much uncompensated care other hospitals in this area cover as compared to the regional hospital.....but since they can't really access that, we'll never know.

I am waiting Mr. Carroll.

Quit acting like $1.5 million for maybe $6-7 million in care gives this paper, or the public for that matter, the right to look in to every move the hospital makes.

Some of you act like you wish the hospital wasn't there.

August 30, 2011 at 7:01 p.m.
harrystatel said...

Any organization that receives tax dollars is open for close scrutiny, as it should be.

August 30, 2011 at 7:57 p.m.
328Kwebsite said...

Another half million gone to rich boy welfare through political fraud and graft. I guess this is the ripoff of the week.

August 30, 2011 at 10:47 p.m.
ex_army65 said...

I'd also like for this newspaper to print an article telling how much Erlanger spent treating non-paying patients. I'm sure thats public record too so it should be easy to find.

August 31, 2011 at 6:48 a.m.

What a freakin' waste of taxpayers' money - I'll bet those Ritz Carlton folks were laughing hysterically once they realized how they had conned this bunch of inbred hillbillies. Nepotism and cronyism is an incurable and infectious disease at Erlanger. If Erlanger wants to improve customer service, I suggest trying to follow some basic Ritz Carlton examples... Are there old bandages, visible dirt and nasty smells in the hallways at the Ritz? I work at Erlanger and I can honestly say that it is one of the NASTIEST places that I've ever seen... I've seen gas station bathrooms that are cleaner... If Erlanger wants people to CHOOSE to use Erlanger, then make it somewhere that you won't be afraid of catching some flesh eating bacteria. I've never seen Jim Brexler or any other powers that be walk the halls where I walk and see the filth. Maybe someone should get out of their nice, carpeted office once in a while. I suppose that the employees at the Ritz Carlton probably get performance reviews and annual raises for good performance - another thing that Erlanger does not do. I also suppose that when someone doesn't do his/her job he/she is terminated. I recently had my annual performance review and my manager didn't ask me ONCE if I had any concerns/suggestions/ etc... I asked why I wasn't allowed to fill out a form as I did in years past whereby I could list my accomplishments and goals. She replied that the person in HR probably got "tired of having to read all of those forms"... I received a good review, but of course, no raise... THAT when to someone at the Ritz Carlton. PUH-LEEZE!

September 1, 2011 at 12:33 p.m.
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