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YKHC President Retires Amid Controversy With The Board

By | January 22, 2014 - 5:29 pm

The Yukon Kuskokwim Health Corporation employs more than 1,600 people. It’s the largest employer in Bethel and has been led by Gene Peltola Sr. for 24 years. However, the CEO spent this past weekend clearing out his office amid controversy with the board of directors.

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Gene Peltola Sr.

Gene Peltola Sr.

Peltola announced his expected retirement Jan. 10. He said he’d work through April. Yet just days later, YKHC’s board of directors told him to leave immediately.

The board is not speaking publically about the issue. Their decision came in a closed executive session. In a release, the board said they bought out the remainder of Peltola’s contract and his early retirement was effective immediately.

They wouldn’t comment to KYUK but referred to a statement where Board Chair Ray Alstrom thanked Peltola “for his years of service”.

A few days before the board meeting, none of the controversy was apparent in a lengthy interview with Peltola when he called the board “excellent”.

Peltola, who is Yup’ik, sat in his office overlooking the Kuskowim River. He reminisced about how YKHC has changed since he took it over in 1990. Back then, the corporation was going through tough times. Three dozen staff had been laid off and most of the director positions were vacant.

“And immediately, I was able to fill those positions with quality people and competent people and that was the crux of the turn around for the corporation,” Peltola said.

YKHC’s annual budget was between $10 and 11 million then. Now it’s $175 million. Peltola said he got marching orders from the board for three things: to pursue sub-regional clinics in the villages, move the hospital from the Indian Health Service to tribal management and to consolidate offices into one main building in Bethel.

Peltola accomplished all three. Through Denali Commission funds he brought 37 new health clinics to the villages.

He said he’s liked the job because he sees results.

“You can see that it’s improving the health of the people we serve and ultimately improving the quality of life of the people we serve,” Peltola said, “and that to me is the most rewarding.”

Before YKHC, Peltola was a business man. He was a private contractor and was involved in construction, the airline industry and retail sales. He brought those skills to YKHC where he bought a medevac company, Life Med. Prior to that, YKHC used commercial airlines.

“We bought three rows of seats on a 737 with Alaska Airlines or a 727 with Reeve then and then strapped in a gurney with a patient and had the attendant sitting there,” Peltola said.

But in 1997, commercial airlines could no longer carry oxygen tanks for safety reasons and Life Med was the solution. The medevac company not only services the Y-K Delta but leases aircraft in Anchorage, Fairbanks, Wasilla, and Soldotna.

“The bottom line is, last year Life Med nearly broke even, we had a small loss but we got $3.8 million dollars of free medivacs,” Peltola said.

Peltola has seen the corporation through two major lawsuits with the federal government fighting for shortfalls in BIA-IHS funding. In 2007, they won $42 million, which was put into a permanent fund. Another settlement last month is bringing in $40 million in back pay. Peltola says tribal organizations have been shortchanged for a while.

“If we were Halliburton or GE or a Lockheed or a Bowing or any other federal contractor, they would be fully funded,” Peltola said.

He says funding has been the biggest challenge of the job. It’s hard when money comes from people who don’t understand just how expensive remote services are.

“I’ve been asked by IHS employees new to Alaska, meeting with them in Anchorage, which way do I drive to get to Bethel from Anchorage,” Peltola said, “and you kind of laugh and chuckle and then tell them there’s no way you can drive there.”

Recently, the health corporation spent $18 million developing a system for electronic health records. Peltola says these successes happen because smart people are working at the corporation. He says it’s important for a CEO to have good people under them.

“He or she can’t do the job by themselves and they’ve got to put together their team and give the members of that team the authority to fulfill their duties and responsibilities,” Peltola said.

YKHC’s board has hired its Chief Legal Counsel Dan Winkelman to replace Peltola, someone Peltola had been grooming for the job.

In a release, Peltola said: “It’s going to be a difficult time but we need to ask and encourage our employees and our community members to come together to support Dan in this transition.”

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