Hospital, HealthTech at odds as board eyes contract
Published 1:30 am Friday, February 27, 2026
The rift between WhidbeyHealth hospital district’s leaders and HealthTech, the consulting company contracted to provide health care management, appeared to have started last year over accusations about the company’s alleged overreach into the hospital administration and a disagreement over who has the power to fire the CEO, according to letters obtained through a public records request.
The hospital’s contract with HealthTech expires in March of 2027, but current and former board members suggested that the hospital will explore the possibility of getting out of it earlier.
During a meeting Thursday night, members of the hospital board went into executive session with attorneys to discuss HealthTech. Marion Jouas, the president of the hospital board, said the reason for the closed-door session was to discuss “existing or reasonably expected litigation” or “litigation or legal risks expected to result in adverse legal or financial consequences.”
No action was taken.
The hospital’s internal dispute became very public earlier this year when three of the five board members passed a surprise motion to fire CEO Nathan Staggs and then reversed themselves after the medical staff protested the decision and a HealthTech administrator summoned two board members into the hallway as the meeting was ongoing. Afterward, two of the commissioners who cast the votes — James Golder and James Canty — resigned while the third, Dr. Mark Borden, blamed HealthTech officials for convincing him to fire Staggs.
Not long afterward, during a staff meeting on Jan 22, the medical staff formally issued a vote of no confidence in HealthTech while also affirming confidence in Staggs and Chief Financial Officer Paul Rogers.
“We respectfully request that the Board take prompt action to evaluate and pursue dissolution of the current HealthTech contract at the earliest feasible opportunity,” the letter to the board from Chief of Staff Dr. Robert Rookstool states. “At this time, the Medical Staff believe that a functional and trustworthy working relationship between WhidbeyHealth leadership and HealthTech no longer exists.”
Jouas said in an email earlier this week that she is the liaison between the the hospital district and HealthTech.
“I had a conversation last week with a Healthtech representative about our ongoing relationship,” she wrote. “I related to them the entire Board of Commissioners will evaluate our future relationship as we fill our board positions to best represent our community.”
HealthTech officials didn’t respond to requests for comment. The Texas-based company specializes in providing community hospital management.
The hospital board entered into a five-year contract with HealthTech in March 2022 after the board fired former CEO Ron Telles. The medical staff passed a vote of no confidence in him and a new chief financial officer uncovered dire financial problems that hadn’t been reported to the elected hospital commissioners.
Under the contract, HealthTech provides the hospital with a CEO and a CFO as well as a range of other management services. The CEO and CFO are HealthTech employees but report to the board.
The contract comes with a hefty price tag. In 2023, the hospital paid HealthTech $1.7 million; the cost increased to $2.2 million in 2025, according to the hospital administration. The overall cost includes salaries and benefits for the CEO and CFO. In 2025, Staggs’ salaries and benefits amounted to $511,000 while Rogers’ salaries and benefits cost $354,000.
In addition, the hospital contracts with Impekkable, a staffing company associated with HealthTech. The contract cost the hospital an additional $200,000 in 2025, according to hospital officials.
Jouas and Gregory Richardson, who was on the board at the time, wrote a letter to HealthTech on June 10, 2025 to clarify the company’s role and to complain about what they felt was overreach and interference on the part of HealthTech.
“We have appreciated that support and accepted the significant cost, but we want you to be aware of the limits and style of involvement that have evolved to a level that that is now considered invasive and over-controlling,” their letter states. “We need to observe a marked reduction in the pressures that are being exerted and the negative impacts we are experiencing.”
A HealthTech official responded with a letter of his own, defending the company and claiming that Jouas and Peterson got their facts wrong.
The letter, signed by Derek Morkel, chairman of the board for HealthTech, states Jouas and Richardson were mistaken in asserting that the board maintains control over the retention of the CEO. Noting sections of the contract, Morkel wrote that the CEO is an at-will employee of HealthTech and either the hospital board or the company can terminate him.
Moreover, Morkel wrote that a noncompetitive clause in the contract precludes the CEO from working for WhidbeyHealth for one year after termination.
“Thus, the Board in no way maintains complete control over the CEO’s retention, and HealthTech explicitly reserves all rights to take appropriate action in that regard,” Morkel wrote.
In their letter, Jouas and Richardson wrote that “pressure at several levels and seeming interference in the day-to-day management of WhidbeyHealth” occurred after the change in the company’s leadership earlier in 2025. The hospital commissioners indicate their primary concern was that HealthTech officials were allegedly pressuring hospital officials to accept revenue cycle administration provided by the company “in lieu of allowing the CEO to evaluate and recommend for approval a vendor with vetted software and a cost-effective contract to support closing an enormous gap in collections for services.”
In an email to the News-Times, Richardson explained that the HealthTech’s revenue cycle support was not producing the stated results and “was costing more than it was generating.” Ultimately, he said, Staggs recruited an experienced director of revenue cycle and eliminated HealthTech’s “support system.”
“The decision to terminate the revenue cycle support proved to be an extraordinarily beneficial one, as the reinvigorated department with an engaged team has managed to identify considerable previously uncollected charges/invoices and increase overall revenues substantially that were rightfully owed (the hospital),” Richardson wrote.
In his response, however, Morkel claims he had clearly communicated to Staggs and Rogers that HealthTech wasn’t interested in doing a full outsource of WhidbeyHealth’s revenue cycle and, thus, there was no pressure. He wrote that collections dropped off dramatically in September 2024 due to problems with Meditech Expense go-live and that HealthTech stepped in to help temporarily.
“Additionally, HealthTech has provided the services of Elrene Clinksales as a senior level Revenue Cycle Consultant to the hospital for eight months at no charge to the hospital,” he wrote. “This good faith gesture would typically be billed to our hospitals at approximately $25,000 per month. This was done as an effective and good faith investment in HealthTech’s relationship with WhidbeyHealth.”
Morkel pointed out that the letter was signed by only two of the five members of the hospital board.
It is, indeed, unusual for elected members of a board to send such a letter when it may not represent the will of the majority. The letter states that it wasn’t signed by a quorum of board members to avoid violating the Open Public Meetings Act.
