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Political ties cited in Perry’s intervention in Oklahoma medical probe

posted on Nov 5, 2015

Texas Gov. Rick Perry wasn’t happy when Oklahoma authorities wanted to revoke the medical license of a surgeon who was accused of botching operations that left patients paralyzed, in perpetual pain — or dead.

So he made a phone call.

It’s unclear how much influence Perry had, but soon after his phone call in early 2013, a three-year, $600,000 investigation abruptly ended.

Anyone who pays attention to Texas politics probably wouldn’t be surprised that Perry would throw his political weight around. What may be surprising is how far he was willing to throw it.

The spinal surgeon, Dr. Steven Anagnost, practices in Tulsa. The state agency that wanted his license was Oklahoma’s medical board. And a recently discovered memo reveals that Perry called Oklahoma Gov. Mary Fallin, a fellow Republican, on Anagnost’s behalf.

Records gathered or created by the medical board during its investigation of Anagnost provide a rare look into the inner workings of state government, where efforts to sway regulatory officials typically don’t see the light of day.

Political connections, as well as old school ties, were in play. And a few years earlier, Perry had received a campaign contribution from Anagnost — and from the man who called Perry.

When Fallin’s general counsel, Steve Mullins, met with key staff members of the Oklahoma Board of Medical Licensure and Supervision in March 2013, Perry’s intervention was part of the discussion.

“He [Mullins] told us that he wasn’t here to interfere with the work of the board but Governor Fallin didn’t want any more calls from Rick Perry about this, that Governor Perry said it was a travesty, and what would it take to make it go away,” Dr. Eric Frische, the medical board’s executive director, later wrote in a memo.

The memo detailing Perry’s phone call was obtained by The Frontier, an investigative news website based in Tulsa.

A Perry spokesman did not respond to repeated requests for comment. Mullins declined to comment.

The Oklahoma medical board had launched an investigation into Anagnost in 2010. It accused him of serious violations involving 23 patients: bungling surgeries in which patients died or were paralyzed or charging for surgeries not performed. Other accusations involved failed surgeries in which Anagnost implanted a spinal device he was paid to promote.

At the time, Anagnost had been named in more than 30 malpractice lawsuits and had settled several cases by paying out of his own pocket. He acknowledged failing to report the settlements to the board, as state law requires, medical board records show.

Despite Mullins’ statements that Fallin didn’t want to interfere, the board’s investigation of Anagnost took a decidedly different turn after that meeting.

“After Mr. Mullins left, we talked among ourselves and with reluctance we considered our options, realizing that we had been told to try and get rid of the case,” Frische’s memo states. “We began to work on an agreement that involved the doctor not agreeing to any guilt.”

Anagnost said recently that, based on his attorney’s advice, he agreed to the settlement instead of demanding a hearing. He said he regrets that decision and has filed lawsuits to overturn the settlement that so far have been unsuccessful.

“The board has their tactics well-sharpened,” Anagnost said. “They’ve done this many a time.”

However, Anagnost rejects the notion that his political connections and Perry’s call affected the outcome of the board’s investigation.

“If the board believed that to be true and the attorney general knows about that, then the attorney general has an obligation to pursue it. That’s borderline criminal,” he said.

He said the memo was written by officials trying to protect their political careers “because of this huge screw-up” in how his case was handled.

Frische’s memo apparently was written to document the disciplinary case’s meandering path and the political pressure to resolve it. His memo recounts the conversation Frische and two other board officials had with Mullins.

Perry was governor of Texas at the time and preparing for his second run for the GOP presidential nomination. As Texas’ longest-serving governor, Perry turned a traditionally weak office into a political powerhouse. And he often used that power — publicly and privately — to benefit his allies and punish others.

In 2013, he made good on a threat to defund the state’s public integrity unit after video surfaced of the Democratic prosecutor in charge of that office acting belligerently during her arrest on suspicion of drunken driving. He’s now fending off an indictment for that move, and he said the charges dogged his recently abandoned presidential bid.

Frische told Mullins the board couldn’t abandon Anagnost’s disciplinary case, no matter the pressure from Perry.

“We attempted to discuss the case and express the seriousness of the charges and findings and that it was too far along to just go away,” his memo stated. Mullins, however, said Fallin was concerned that Anagnost’s case “would result in some bad law, and the governor didn’t want that.”

Soon after the meeting, the board agreed to a deal.

Anagnost admitted no guilt. He paid a $10,000 fine. He agreed to additional training on medical procedures and physician billing practices.

And he kept his medical license.

Five months later, Anagnost was back before the board, which found he had completed all requirements of the settlement. The board determined that he was competent to practice.

Alex Weintz, a spokesman for Fallin, confirmed that the governor’s office intervened in the case but said Fallin was “agnostic” on its outcome.

“Our office, through Steve Mullins, communicated that basically they needed to either act against Anagnost or drop the case. … We just didn’t want a state agency to have a case that was open-ended and went on for years,” he said.

Weintz said Perry and Fallin had “a cordial working relationship” as neighboring governors and members of the Republican Governors Association. Fallin was recently named chair of the group’s policy committee.

Anagnost said he’s “not perfect,” but he has denied fault in all of the claims filed against him at the medical board.

Post-surgical injuries and poor patient health contributed to a few bad patient outcomes, he said. And Anagnost launched his own offensive, alleging that the board’s investigation was biased and that several board members had conflicts of interest.

The board first tried to revoke or suspend Anagnost’s license in 2010. Its investigation continued for three years.

Anagnost said the investigation focused only on problem cases and didn’t look at the overall results for his patients, which he said were better than average.

“I know that I’ve never done a perfect job on any patient I’ve worked on … but it’s not fair to look at anybody at a single point in their career,” he said.

The Tulsa surgeon filed a lawsuit against the board in 2012 that ended up before the Oklahoma Supreme Court.

In a 5-4 decision, the court declined in 2013 to intervene in the medical board’s investigation of Anagnost, with the majority saying there was no reason to interfere with the administrative process.

However, the four dissenting justices noted apparent conflicts of interest and other procedural problems with the investigation. One dissenting justice stated that the board failed to give Anagnost “even the minimal due process” he was owed.

Anagnost said he believed it was the state Supreme Court’s criticism, not political pressure from Fallin or Perry, that prompted the settlement.

Though he agreed to settle the investigation in 2013, Anagnost’s case is far from over. It has moved on to the courts, with Anagnost suing four Tulsa neurosurgeons who took part in the board’s investigation, the state medical board, several board staff members and attorneys who helped the board.

At one recent hearing in Oklahoma City, 17 attorneys appeared to represent all of the parties Anagnost is suing.

Meanwhile, Anagnost continues to fight and settle negligence lawsuits naming him. Out of 45 negligence lawsuits filed against Anagnost in the past decade, 19 are listed in court records as settled and nine remain pending.

Lyle Kelsey, executive director of the medical board, declined to comment on Anagnost’s case, citing lawsuits filed by the surgeon against the board.

Former board members have also declined to talk, citing Anagnost’s lawsuits against the board and one former member.

Tennessee connection

Frische’s memo also sheds light on who prompted Perry’s interest in the case.

“Lyle … discovered that the doctor had a benefactor by the name of Dick Powell who was very wealthy, a significant contributor to Rick Perry and also a surrogate father to the doctor and that he was behind the effort to get rid of this,” Frische wrote.

Dick Powell is Richard C. Powell of Knoxville, Tenn. Records list him as an officer in a Texas company that owns a Fort Worth IHOP and officer of a Tennessee restaurant company.

Powell contributed $2,500 to Perry’s presidential campaign in 2011, the maximum allowed. He was a member of the Perry campaign’s Tennessee finance team.

Powell’s links to Anagnost, who also contributed $2,500 to Perry’s presidential campaign in 2011, are not so apparent. Powell did not respond to requests for comment.

Anagnost said he asked Powell, the father of a longtime friend, for help getting the attention of a state agency he believed was hell-bent on taking his license. He said he sees nothing wrong with calling on powerful friends to correct what he views as an injustice.

The Webb School, an exclusive boarding school in Tennessee, is the link between the two.

Powell’s son, Richard C. Powell Jr., attended the high school and graduated in 1985. So did Anagnost, who is from Knoxville and later graduated from the University of Tennessee’s medical school.

The younger Powell also has ties to Texas, and to Republican Party movers and shakers in the state.

He graduated from Southern Methodist University and is president of Teneo Strategy, a “global advisory firm” that works with large corporations and governments. He’s a former managing director for Quinn Gilliespie & Associates, now QGA Public Affairs, one of Washington’s top lobbying firms.

His wife, Dina Habib Powell, has deep Republican ties. She was an official in the George W. Bush administration and also worked for one-time House Majority Leader Dick Armey, R-Flower Mound. She currently works for Goldman Sachs as the head of Impact Investing and is president of the Goldman Sachs Foundation.

The younger Powell and his wife could not be reached for comment.

‘Sick to my stomach’

Alyson King also has a connection to Anagnost.

She says she couldn’t feel most of her left leg and foot when she awoke from a 2007 surgery he performed.

She filed a lawsuit against Anagnost in 2009, alleging that he caused permanent neurological injury to her leg and left her with a condition known as foot drop. Her lawsuit states she has frequent pain from the “multiple inappropriate and negligent” surgeries performed by Anagnost.

The 45-year-old Tulsan, a mother of three children, was among the dozens of patients who filed complaints with the state and sued Anagnost for negligence. Her case is among the nine pending.

Anagnost has rejected her claims, saying in court filings that her attorneys have failed to obtain an expert witness who can testify that he was responsible for her injury.

King said Anagnost’s 2013 settlement with the Oklahoma medical board was incomprehensible.

She was shocked to learn recently from a reporter about Perry’s intervention on Anagnost’s behalf with Fallin — and about the visit by Fallin’s attorney to the medical board.

“I’m sick to my stomach,” King said.