Kettering Health officials say they retained an outside firm to conduct an internal investigation and another to recommend updates to processes and policies in response to “allegations of inappropriate fiscal and operational management at Kettering Health.”
“While this work is ongoing, we are taking steps to address wrongdoing and shortcomings we identify. These steps include making necessary personnel changes — inclusive of employees and members of the board — to ensure both individual accountability and strict compliance with updated and comprehensive governance practices,” says a statement from the hospital network released Monday.
The hospital network would not comment on specific personnel issues or make anyone available for an interview.
The statement came in response to records obtained Friday by the Dayton Daily News and other media outlets containing a pair of anonymous complaints filed with the Ohio Attorney General’s Office alleging “abuse of charitable funds.”
The complaints referenced former Kettering Health CEO Fred Manchur and Dave Weigley, former chairman of the Kettering Health board and current president of Columbia Union Conference of Seventh-Day Adventists. Kettering Health is affiliated with the Seventh-Day Adventist Church.
The anonymous complaints accuse Manchur of expensing trips and using hospital network funds to remodel his home, and involve Weigley’s automobile expenses, among other things.
Manchur and Weigley were not able to be reached for comment.
Complaints to the AG’s office also referenced additional Kettering Health executives. A complainant who identified as an employee alleged Manchur had “the CFO hide true finances at board meetings, not allowing true financials to be shown.” The current interim president of Kettering Health is Michael Mewhirter, who was formerly a CFO for Kettering Health, but he was not referenced by name in the complaints.
Manchur’s retirement was announced in November and effective by the end of December. Weigley left the Kettering Health board in January. Two other top Kettering Health executives left the network in October, including Kettering Health President Wally Sackett and Chief Administrative Officer Terry Burns.
Manchur’s compensation frequently exceeded $1 million, not including large bonus incentives and other reportable, but unspecified, compensation, according to Kettering Health’s IRS public disclosure forms obtained by the Dayton Daily News. In the most recent public disclosure form available, which was for 2021, Manchur’s base compensation was over $1.6 million, in addition to a bonus of $407,160 and other reportable compensation of $82,317. Retirement funds and other nontaxable benefits exceeded $40,000.
Manchur’s base pay ranged between $1.2 million and $1.5 million between 2015 and 2020. While he did not take a bonus in 2020, Manchur’s bonuses typically ranged from $390,258 in 2015 up to $465,325 in 2019, according to the IRS records. Manchur’s largest total compensation in recent years was reported in 2017 when his total compensation exceeded $5 million, including a bonus of over $230,000 and other reportable compensation over $3.4 million.
Complaints to the AG’s office also pertain to Manchur’s employment of family members, such as his son Richard Manchur who was named president of Kettering Health Dayton (formerly Grandview) in 2019.
IRS tax forms from 2021 report compensation for Manchur’s son and son-in-law. Richard Manchur was reported as receiving compensation in the amount of $830,952, and Manchur’s son-in-law, Jared Keresoma, was reported as receiving compensation in the amount of $419,435. Keresoma is the vice president of operations at Greene Memorial Hospital.
The Dayton Daily News in 2011 reported that Kettering Health employed executives’ family members more often than other local health systems.
Under questions regarding compensation in IRS tax forms, Kettering Health reported it provided travel for companions, tax indemnification and gross-up payments, and personal services. The public disclosure form did not specify who received those benefits, just that it was in relation to anyone reported as being highly compensated.
Past public disclosure forms also reported the organization provided a housing allowance or residence for personal use. Loans for employees were also declared on past public disclosure forms, including a home loan in the amount of $178,808 to Burns; a relocation loan in the amount of $484,363 to Terri Day, former president of Kettering Health Network; and a relocation loan in the amount of $81,750 to Jarrod McNaughton, a former director of Kettering Adventist Healthcare. The agreements and terms of the loans were not included in the public disclosure forms, but the forms said the loans received board approval.
The Dayton Daily News obtained the complaints from the Ohio Attorney General’s Office charitable law section using Ohio public records law. The AG’s office said they would not release records of any investigation by their office or acknowledge if such an investigation exists.
“We are—and have been—fully aware of allegations of inappropriate fiscal and operational management at Kettering Health,” Kettering Health’s statement released Monday says. “Our board and leadership team take these allegations seriously and are committed to integrity, improvement, and upholding the trust of our staff, providers, and community.”
The statement concludes: “Kettering Health remains steadfast in our faith, and with a dedicated team and a strong financial position, we will continue to deliver on our sacred mission throughout Western Ohio. Our commitment and mission ‘to improve the quality of life of the people in the communities we serve through healthcare and education’ will never waver.”