RICHARDTON - Cyndy Ritzke needs to hire more nurses to care for patients at the Richardton Memorial Hospital.

She could find the nurses if she had the money, she said.

Ritzke is one of two full-time nurses at the hospital, which needs an intravenous flow of money to meet cash flow and deal with a sea of red ink. A $700,000 debt is the result of several factors, including alleged bad management by its previous administrator.

The hospital terminated its contract with that administrator, Bruce Howe Jr., and is pursuing legal action against him and his company, Dakota Medical Resources Group.

The hospital's records have been turned over to the Stark County state's attorney for criminal investigation.

Howe Jr. is alleged to have taken a $222,000 overpayment from Medicare and then spent the money and hid the debt from the board.

Howe Jr.'s attorney, David Reich, said the board's minutes show the board approved the expenditures.

Ritzke, who's also the director of nurses, was among about 150 people who crowded into the music room at the Richardton school Wednesday night. They came to hear how the hospital and its associated clinic will get beyond the present financial crisis.

The hospital staff didn't know how bad things were until late November, when the hospital couldn't make payroll until a board member donated $20,000.

The hospital has made two subsequent payrolls, including one Thursday.

A moratorium on accepting new patients, out of fear they'd have to be transferred if the hospital closed, has been lifted. New patients are now being accepted.

Jim Opdahl, a former hospital administrator who's made a career out of helping small rural hospitals through hard times, said his initial reaction was, "No way," could the problems be solved.

After taking a deeper look, he said there's hope if the hospital can buy 90 to 100 days before it has to pay back loans and money due to Medicare.

The debt includes loans from the Bremer bank, the money due to Medicare and $279,000 owed to various vendors who supply the hospital.

The hospital had hoped Medicare would allow the money to be paid back over three years, by subtracting it in staged amounts from normal reimbursements.

Opdahl said the hospital got word early this week that Medicare has agreed to a two-year repayment plan but will withhold $7,000 a month from reimbursements, starting now. Opdahl said the hospital had hoped the agency would defer collections for the 90 to 100 days that will be so critical in the near term.

Opdahl said Howe Jr. lacked the expertise to know that the $222,000 payment from Medicare should have been banked, not spent, until the hospital reconciled whether it was an accurate compensation for real costs, since it's an estimated payment based on past costs.

"He should have put that baby in the bank and waited to see how it worked out," Opdahl said.

Instead, the board says the money was partly spent to buy furniture through Howe Jr.'s Dakota Medical Resources Group and computers from his brother, Tim Howe.

The board's attorney Mike Maus said Howe Jr. hid the overpayment debt by covering it with yellow sticky notes on original financial reports and giving board members incomplete information.

Opdahl said the board will work with the Bremer bank in Richardton to make interest-only payments until it can catch up.

The hospital and clinic costs are $75,000 a month, so it needs time to build up revenue before it can pay off debt.

"We're buying the time," Opdahl said.

Some who came to the meeting said they felt better after hearing Opdahl's assessment.

Donna Schuhrke-Ridl, the other full-time registered nurse, said Opdahl's confidence that there's a way out of the mess made her feel better.

Board member Linda Pehrus said she's gone from "panic to comfort. It's been very difficult."

There was a bit of a stir when the meeting was opened for questions.

A hospital lab technician, Carol Lemmick, said her brother, a Minneapolis businessman, has a group of investors that are interested in buying the hospital.

She wouldn't name her brother for this story, but asked why attorney Maus hasn't returned phone calls to him.

Maus said he had conveyed some information to her brother's associate but had gotten no return calls, nor was there an offer.

Opdahl said the hospital is not very sellable in its current financial shape.

Rep. Shirley Meyers, D-Dickinson, also caused a bit of stir and applause when she suggested the board turn the matter over to the state board that disciplines attorneys.

Howe Jr.'s father, Bruce Howe, of Dickinson, provided some legal assistance for the hospital board, including getting signatures from the board on a new contract for his son and Dakota Medical Resources Group, Maus said.

Howe the attorney also is the president of Dakota Medical Resources Group. Maus said not all of the board members knew that Howe the attorney had an interest in the same medical group they'd hired to administer the hospital.

Reich, Howe's attorney, said Howe the attorney disclosed that information to hospital board president Phillip Messer.

After firing Howe Jr., the board hired Maus to pursue legal action against him and his company. Maus and Howe the attorney were longtime law partners, and their split was ugly and had to be settled in court.

Meyers said it wasn't up to the board to recognize a conflict of interest.

"That's why a criminal and civil suit should both be filed," Meyers said. "If federal laws were violated, that needs to be pursued immediately."

Opdahl said the hospital's problems date back several years, including to when it took over the clinic operation, which had been managed by Medcenter One.

Tom Nehring, who manages a group of provider-based clinics in Dunn, Mercer and Oliver counties, was brought in to help shore up the clinic side of Richardton's operation.

He said he's making an application for Richardton to be designated a provider-based rural health clinic, which would significantly increase its reimbursement rate.

Nehring said it's human to want to blame someone for problems. "The most productive thing to do is move on," he said.

(Reach reporter Lauren Donovan at 888-303-5511, or lauren@;westriv.com.)