The directors of Baltimore Behavioral Health Inc., a major drug treatment provider in Baltimore, have laid off longtime executive William "Kris" Hathaway, as the once high-flying nonprofit continues to cut costs.
The board of directors had earlier removed Hathaway as chief executive and put vice president Terry T. Brown in charge of the clinic, which specializes in treating people with both addiction and mental illness.
In an emailed response to questions from The Baltimore Sun, board member Jay Miller said that Hathaway was laid off "in the interest of saving money."
Efforts to reach Hathaway, who lives in Ellicott City, were unsuccessful Wednesday and Thursday.
Hathaway, 49, is a member of the family that established BBH in 1997 and built it into a business with $20 million in annual revenue by 2008. In 2010, the clinic was the subject of a Sun investigation that revealed unusually high Medicaid billings and six-figure salaries paid to him and family members who controlled the nonprofit company. In 2008 Hathaway was paid $347,000.
State regulators subsequently forced a shake-up of the board, leading to the arrival of Miller and other new members. With the state curtailing some kinds of Medicaid payments for mental health care, reimbursements to BBH fell sharply and the clinic went through multiple rounds of staff layoffs. Total revenue dropped to $9.6 million in 2010, the most recent year for which figures are available.
"Right now I think we may be able to survive as an organization if I can make a few more cuts," Brown said Wednesday in an interview. Several of Hathaway's relatives still work at the West Pratt Street clinic, Brown said, though at lower salaries than before.
BBH continues to face challenges. Brown said employees have been working through stacks of unopened mail, including bills and even some checks made out to the clinic. In March, the clinic's power was cut for several days because of unpaid utility bills.
Court records show that the clinic did not respond to a federal lawsuit filed by employees who allege that executives "diverted and stole" money intended for their retirement plans. That case is pending.
In March, a Baltimore circuit judge awarded a default judgment to American Express in a lawsuit seeking $58,463.24 in unpaid charges, according to court records. Though Hathaway was the only named defendant, American Express submitted a court exhibit showing a bill for a credit card labeled "Business Platinum Card." The statement listed "Baltimore Behavioral" over Hathaway's name.
Both Brown and Miller said they hadn't known about the dispute with American Express. Miller said he is "looking into it."Copyright © 2015, The Baltimore Sun