Creary Steps Down | City Limits | Los Angeles | Los Angeles News and Events | LA Weekly
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Creary Steps Down 

An embattled medical entrepreneur leaves county service

Wednesday, Jun 21 2000
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In December, we last looked in on Dr. Ludlow B. Creary, then one of the most senior -- not to say best-paid -- staffers at the county’s unquiet Martin Luther King Jr. Medical Center.

The 60-ish Creary was a powerful and controversial character on the Lynwood health campus, who drove a fancy import car to work and deported himself with considerable swagger and swank. He was also, often, at bureaucratic war with his employees, colleagues and even superiors.

Now Creary is finally out of his main job running family medicine at Charles Drew University Medical School, which is closely affiliated with King hospital. His exit comes after public controversies involving staff assignments and litigation over his refusal to allow the county access to his patient medical records. No Drew University official returned calls asking for comment, but staff in his former office confirmed his departure. Confirmation also came from assistant county health director Donald Thomas.

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Creary‘s separation can easily be read as a setback for the doctor, given that he spent much time and money trying to prove that he -- and not county and King-Drew officials -- was in the right regarding any number of disputes over the years. But the blow to Creary’s reputation is modest compared to what he already has endured in a Northern California case, one that never got public notice in Southern California.

This out-of-town dark spot in his not-too-distant past is a late-1995 $535,000 judgment and injunction against Creary and an associate in Alameda County Superior Court, never reported in Los Angeles. The judgment basically ordered one of his profitable side businesses -- a 6,000-member Bay Area HMO -- to halt unethical hard-sell and operating practices. According to Alameda County officials, the clinic still operates, without continuing problems, under the permanent conditions of the civil judgment.

In the original Alameda County complaint, Creary, his clinical and usual business partner Patricia Matthews-Juarez, and the Creary-owned firm called California Family Care Services were accused of violating state law with an aggressive door-to-door campaign (mostly focused in the Latino community), in which sales representatives signed up clients while failing to tell them they could no longer be treated by their own physicians. (These clients were gathered up under a state law that allows Medi-Cal patients to chose their own care-provider health plan.) Further, according to Alameda County Deputy District Attorney Laurinda Ochoa, getting out of the Creary plan was made quite difficult for dissatisfied customers.

In an interview, Ochoa asserted that “the Alameda County grand jury was about to indict” Creary and Matthews-Juarez on criminal charges when the civil-court judgment was issued. As is usual in such agreements, there was no admission of wrongdoing; the signatories, however, are permanently bound to refrain from enumerated wrongful practices, under severe penalties of law.

Although based in Los Angeles, California Family Care operated two clinics in Oakland and East Oakland. The Oakland Tribune reported that, while California Family Care was not the first health plan to be accused of violating state business and welfare laws “by misleading people into enrolling,” it was the first to be sued for doing so in Alameda County.

Court documents alleged that the California Family Care patients were denied the forms necessary to exit the program. And that Creary‘s operation also failed promptly to notify the state when a patient did manage to leave the plan. As a result, the papers state, in 50 documented cases, the Creary HMO continued to collect the up-to-$80-a-month state reimbursement for patients no longer in its care.

The stipulated judgment of December 4, 1995, enjoins California Family Care from more than 20 enumerated activities. These included enrolling non-English-speaking patients over the phone or in person without having an interpreter available; employing hard-sell marketers working on a pure commission basis; and failing to supervise those marketers’ pitches and sales techniques. The injunction also required the firm “to maintain and, on 24 hours notice, to make available for inspection to any member of the Office of the District Attorney of Alameda County all documents, logs and reports relating to enrollment, disenrollment and patient grievances.”

The county of Los Angeles could have used something like that settlement agreement in its dealings with Creary. Last year, Creary succeeded for several months in stonewalling auditors from the Los Angeles County Department of Health Services from reviewing records of King-Drew--affiliated clinical practices that he managed. Creary associate Paul Juarez (who failed to return calls for this story) at that time told the county bean counters -- in correspondence acquired by the Weekly -- that the county‘s request for record access was an “illicit seizure” bid that compromised patient privacy rights. County officials, in turn, contended that they wanted to audit patient care and check for financial improprieties, which they said they had a right to do.

Prior to Creary’s departure, county officials apparently obtained access to many of these records. But with Creary gone from the scene, it‘s most likely that nothing further will happen regarding this review of patient records, according to assistant county health director Thomas.

Thomas added that the subject of the Alameda County injunction “came up in the course” of recent county attempts to access Creary’s King-Drew clinical records. Prosecutor Ochoa said her office had not contacted the county, but added that state officials were “aware of our judgment,” information regarding which could easily have made its way to L.A.

Two county health administrators, not speaking for attribution, have said that the Alameda County matter influenced the decision to pursue access to Creary‘s local records. Creary associate Juarez, in an earlier interview with the Weekly, blamed Creary’s problems in Northern California on a former business associate and reiterated that the legal stipulation contained no finding of wrongdoing. For this story, neither Creary nor Juarez was available for comment. They could not be reached through their former county-affiliated offices, which provided no forwarding information. And a call to Creary‘s private office number was picked up by the answering machine of an attorney.

According to the 1995 Oakland court-settlement papers, the $535,000 that Creary and Matthews-Juarez agreed to pay in penalties included a $300,000 fine, plus additional levies for public and patient restitution and plaintiff legal costs totaling $235,000; the judgment included a process whereby Creary could put up his house on Jupiter Drive in the Mount Olympus section of Los Angeles as security toward payment of the penalties. The defendants were given more than a year to complete payment, said prosecutor Ochoa last week, but the penalty was paid in full within six months of the 1995 agreement.

Despite that setback, Creary retained strong earning power. According to 1997 county records, Creary earned a combined salary of more than $201,000 per year for his work at King Hospital and his position at Drew University. At Drew, Creary held the essential position of chair of family medicine for nearly 25 years.

In addition, the doctor, who drove a Rolls-Royce at the time of the consent decree, had enough other going business ventures to make you wonder how he found time to practice medicine on behalf of L.A. County.

According to recent state corporate records, Creary recently presided over four for-profit California corporations (not including California Family Care) of unspecified size, plus one nonprofit entity. The same records show that a dozen Creary-founded corporate entities have been suspended over the past eight years -- mostly because of failures to keep up payments on state franchise taxes. At least one of these companies did business with the county health department.

Creary also maintained -- and apparently still maintains -- an active private medical practice. (So do many other doctors at King-Drew and in other county hospitals.) But he no longer holds his chairmanship at the King-Drew hospital.

Officials are reluctant to discuss the details of and reasons for Creary’s departure. According to Thomas, Creary has left the university voluntarily, but is still practicing medicine at the nearby King Medical Center. This week, however, hospital personnel could not confirm for the Weekly that Creary still worked there. Family-medicine staffers contacted by phone said that his former chair is now held by a temporary appointee, pending a search for a permanent replacement.

Last fall, the Union of American Physicians and Dentists (UAPD), the newly recognized bargaining unit for Los Angeles County health-service doctors, filed an unfair-labor-practice charge against Creary, alleging that the chairman had compelled eight King-Drew teaching doctors to work in an Inglewood clinic he operated, without remuneration. They claimed they‘d been threatened with firing if they did not comply with the demand. The doctors, sometimes referred to as “The Imperial Heights Eight,” because their official work site was in Imperial Heights, were ultimately released from duty at the Inglewood facility, which began as a Drew University--affiliated clinic. For his part, Creary has insisted in legal filings that the Inglewood clinic was professionally and ethically managed.

The final resolution of the doctors’ grievance remains pending, according to UAPD union official Joe Bader. A Civil Service Commission hearing is also pending.

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