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Blue Cross exec alleges IHC boss tried to bully him

Published July 21, 2005 12:35 am

Amid Utah probe: He says the CEO threatened him with a loss of business if he did not alter company testimony
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On July 7, the head of a legislative task force examining Utah's health care system warned his audience that harassing anyone testifying before his committee would be violating Utah law and the behavior would not be tolerated.

A day later, William Nelson, chief executive officer of Intermountain Health Care, allegedly did just that. In a confrontation at a Cedar City social event, Nelson allegedly threatened a senior Regence Blue Cross Blue Shield of Utah executive with the loss of business if company representatives continued to twist facts in presentations to the task force.

"In my opinion, it was an attempt to intimidate us into either not testifying before the task force or change what we were saying to the task force," said Kevin Bishoff, vice president for public and corporate affairs.

"It's clearly out of bounds," Bishoff said. "It certainly implied that this would affect our ability to do business with IHC in the future."

Nelson acknowledged complaining to Bishoff about being "blindsided" by comments made at task force meetings. But he denied making threats about IHC's relationship with Blue Cross or using rude language. He said Bishoff distorted his comments, possibly to discredit Nelson and IHC.

"It would be lunacy for me to make some threat of retaliation. I would never do that," Nelson said.

The public flap between two high-ranking health industry executives is somewhat unprecedented and illustrates the growing tensions stemming from the Privately Owned Health Care Organization Task Force. The group was created by the Legislature to examine IHC's nonprofit status and probe allegations of aggressive collection tactics, bullying of competitors and using its dominance in Utah's health-care market to stifle competition.

The task force has met just four times, and accusations that IHC employees have intimidated people called to speak have been swirling for weeks, said Sen. Mike Waddoups, task force co-chairman.

The accusations pushed Waddoups to speak to Nelson more than a month ago. Waddoups said Nelson assured him that his employees had not intimidated anyone and that he would investigate any accusations of harassment that Waddoups brought to his attention.

But when the accusations didn't cease, Waddoups took the unusual step at the July 7 meeting of reminding the audience that intimidation was a felony crime under Utah law. Another meeting of the task force is set for today and the topic of intimidation is unlikely to go away.

"We've had more than one person say that they didn't want to testify because IHC would retaliate against them," Waddoups said.

The people complaining about IHC have expressed fears they would lose their jobs, IHC would refuse to do business with their companies, or that Utah's largest health care provider and health insurer would force financial modifications to existing business contracts, Waddoups said.

"It might be higher than six to 10 [complaints]. It's probably closer to eight to 15," Waddoups said.

Waddoups' comments at the meeting prompted Nelson to respond that IHC had intimidated no one and would not do so in the future.

Yet, the next evening, at a social event for the Utah Shakespearean Festival, Nelson approached Bishoff, who was accompanied by his wife and Doug Hasbrouck, medical director of Blue Cross.

"He came over to me and he said, 'I'm really pissed off at Blue Cross,' '' Bishoff said. "He said, 'who is that girl who goes up and testifies for you guys? . . . She's up there, twisting the facts, and this has to stop. And you tell Scott Ideson if he doesn't have the balls to call me, if he's not man enough to call me, then our relationship is over,' '' Bishoff said.

"That girl" is Jennifer Cannaday, assistant vice president for government relations at Blue Cross. Her role is to speak for Blue Cross and answer questions posed by the 15-member task force.

"We weren't twisting the facts. The questions [from legislators on the task force] are what they are, and the information is what it is," Cannaday said.

Hasbrouck confirmed most of Bishoff's allegations.

"I was standing five feet from Kevin and Bill Nelson. I was directly facing them for a period of time. I directly overheard, I'm going to say, three to five minutes of the conversation. After that point, I actually was somewhat embarrassed by the tone of the conversation, so I actively turned away from it," Hasbrouck said.

Nelson did say he was "pissed off" and did refer to Cannaday as "that girl," Hasbrouck said.

Hasbrouck said he can't remember specific words that Nelson made about Ideson. But Hasbrouck recalled hearing loud "language to the effect that he was upset with Scott to the point that the business relationship would be affected."

In an interview, Nelson repeated comments he e-mailed to Ideson on July 19, four days after Bishoff sent an e-mail to Nelson to express his dismay at the episode.

Nelson admitted he was frustrated because Ideson had not honored a promise to call him to discuss their business relationship. Nelson said he felt "blindsided" by some of Cannaday's assertions about the business relationship that were raised to the task force without the courtesy of informing him first.

He denied calling Cannaday "that girl."

"I felt frustrated and blindsided, but did I threaten some sort of retaliation? No," Nelson said.

In his e-mail to Ideson, Nelson said, "That's not the way I operate, and it's not the way I expect IHC to operate. For [Bishoff] to construe my remarks as somehow equating to threatening retaliation . . . is a gross misrepresentation of our conversation. There was absolutely no threat, veiled or otherwise."

Nelson said he was confused by Bishoff's e-mail, "which seems calculated to discredit me and IHC."

Waddoups said he plans to talk to Nelson to get his side of the story before deciding how to proceed.

"If this comes up to be as offensive as it sounds at this point, I intend to make this more of a public issue," Waddoups said.

"I could go so far as to bring it out in the [task force], take it to the entire Legislature, even to the attorney general, so far as to prosecute perpetrators under the felony statute," he said.


Meeting today

What: Privately Owned Health Care Organization Task Force meeting

When: Today, 1-5 p.m.

Where: State Capitol Complex, House Building, Room W135




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