Miller: CRMC Kickback Scandal Led To Shelton Inquiry

Cookeville City Council Member Mark Miller said a recent lawsuit against Cookeville Regional led to the council’s move for an investigation into CRMC’s hiring of Mayor Ricky Shelton.

“Following the $4.1 million dollar settlement with the Department of Justice due to an illegal kickback scheme while the mayor was serving on the Board of Trustees with Cookeville Regional, a level of skepticism has developed with the high level decisions made by CRMC executives,” Miller said in a statement Thursday. ” Spending a few thousand dollars to ensure the mayor did not break any laws is warranted to ensure a large corruption scandal does not develop.”

Cookeville Regional CEO Paul Korth was unavailable at press time for comment.

Cookeville Regional agreed to pay the federal government $4.1 million in December, 2019 in a whistleblower lawsuit. The suit involved a former hospital executive, fired in 2015. Former Executive Duane Seabury was hired in 2011. He alleged the hospital paid cardiologists inflated salaries and bonuses, but made up the money by sending CRMC patients to the doctors in what some viewed as a kickback.

A Knoxville attorney, hired by the council, sent a letter to City Manager James Mills Wednesday saying no laws were broken, and the hiring of Shelton did not violate any part of the city charter.

Miller said he does not dispute the attorney’s conclusion. Miller said from his viewpoint, further action is unnecessary.

“From my end, it does,” Miller said. “I just want to protect the city to make sure the city doesn’t have any… some legal loop hole wasn’t developed and that we are protected as a city from any future financial hardships.”