A special report by Health Canada investigators sets out troubling allegations about the conduct of staff at the Poplar Hill nursing station in northern Ontario, and about a small airline from which the Canada Revenue Agency is still trying to recover a sizable amount of money.
The RCMP has also been asked to step in.
The claims are brought to light as part of a months-long investigation by The Canadian Press into allegations of wrongdoing by service providers of the federal government's health plan for aboriginals.
The Non-Insured Health Benefits program provides health-benefit coverage to eligible First Nations people and Inuit when they are not insured by private or provincial plans. The NIHB program also covers travel costs when aboriginals need medical treatment but cannot receive care in their home communities.
Medical transportation is supposed to be arranged ahead of time at the Poplar Hill nursing station, the Health Canada report says, but nurses can approve urgent medical transport outside of normal working hours without prior notice. They do so through documents called local purchase orders.
But the report alleges staff at the nursing station may have had ulterior motives for arranging some of these supposedly urgent medical flights.
"Interviews with the (Keeper River Airways) air transportation representatives in Red Lake, nurses from the nursing centre and the community health representatives indicated that the majority of these flights might have been arranged to Red Lake to provide for personal benefits," the document says.
"In one interview, (blank) explained one of the main reasons for going to Red Lake: 'Groceries. People go for groceries. It's a big thing.'"
Keeper River Airways owner and pilot Terry Cousineau confirmed to The Canadian Press that some patients returned from medical appointments with groceries. But he added he is not aware that anyone from the nursing station arranged flights specifically to get groceries.
"Not only did we have to bring them into Red Lake or Pikangikum to see the doctor, dentist or whoever, we had to take them back home, of course," Cousineau said in a telephone interview.
"So when they went back home, they invariably had at least a bag or a couple bags or couple boxes of groceries or whatever.
"I can't say as I blame them. Like I say, the price of groceries in Poplar Hill is pretty expensive because it has to be flown in."
The closest place to Poplar Hill to get medical treatment is Pikangikum, a 12-minute flight away. Three local airlines flew between Poplar Hill and Pikangikum: Superior Airways, Wasaya Airways and Keeper River Airways.
The auditors found that 479 of the 487 local purchase orders for urgent medical transport — representing 98.4 per cent of all the flights — were arranged through Keeper River Airways, which they say was "by far the most expensive" of the three airlines. Cousineau said he was told his airline was actually the cheapest option.
The auditors also found most of the trips from Poplar Hill were to Red Lake, which is more than twice as far away as Pikangikum and offers almost exactly the same medical services.
The nursing station could not explain to the auditors why it used what auditors say was the most expensive airline or why it sent patients to the more distant Red Lake instead of Pikangikum.
The auditors claim the nursing station cost the Non-Insured Health Benefits program up to $654,064 more than it should have by using Keeper River Airways and sending patients to Red Lake.
Cousineau said he brought up the soaring flight bills with the nurses, who assured him the nursing station could afford it.
"I know I asked the nurses a few times, 'Are you sure the medical services can pay for all these trips?' They were adding up their bill pretty quick," he said.
"They always said, 'Oh yeah, no problem. We'll get on the phone and get them to pay up.'"
Poplar Hill First Nation Chief Patrick Owen said neither he nor the band office staff is aware of the allegations in the Health Canada report, adding the department never contacted him about the matter.
However, he did say not all flights were for medical reasons — although he conceded he did not know the purpose of the trips.
"I know they used them for their, I don't know, I'm not sure, their personal trips sometimes when they have to go out," Owen said in a brief telephone interview.
The Canadian Press provided Owen with a copy of the report. In a subsequent interview, he said the band office staff was not aware that nursing station staff were allegedly arranging flights to get groceries.
"We weren't aware what was it for, where it's coming from," he said.
The chief said he was unable to provide more information.
Poplar Hill First Nation health director Barbara Strang refused to discuss the matter during a brief telephone interview. She did not answer subsequent telephone calls or respond to emails.
Other troubling allegations emerging from the investigation:
— information on the local purchase orders did not always match plane logs and flight manifests;
— signatures were forged on the local purchase orders in 84 cases;
— some local purchase orders were signed days after the medical transport, sometimes by nurses who had nothing to do with the cases;
— one of the nurses routinely abused her position to travel. She would claim expenses for fake trips and travel under the names of patients or with forged documents.
The Canadian Press obtained a partially censored copy of the 18-page report under the Access to Information Act.
The document alleges the nursing station favoured Keeper River Airways over the others because one of the nurses allegedly had a "business relationship" with the airline.
"(Blank) was involved in several areas demonstrating inappropriate personal activities and involving actual or apparent conflicts of interest that were not disclosed as required by the (Health Canada conflict-of-interest) guidelines," the document says.
The nurse's name is withheld in the copy of the report that Health Canada released to The Canadian Press.
"The nurse admitted that while an employee of Health Canada, she was (blank) of that airline company by organizing some of the flights and collecting fees to be paid by travellers."
Cousineau said no one from the nursing station ever worked for his company.
The nature of the woman's supposed relationship with the airline also seems to have baffled Health Canada, for whom she worked as a community health nurse.
"Health Canada is not aware of the exact nature of the relationship," spokeswoman Christelle Legault said in an email.
The department suspended the nurse without pay in March 2010, Legault said, adding the woman quit two days later.
The matter was referred to the Mounties in May 2011. RCMP Sgt. Richard Rollings said he could not comment on any investigation.
"The special examination report concluded that certain employees from the Poplar Hill Nursing Station failed to use the most cost effective means of providing transportation services and failed to follow proper signing authority procedures," Legault said.
"In addition, one employee misused the signing authority to gain illegitimate air transportation, fabricated a number of supporting documents to take unwarranted leaves of absence and was reimbursed for unjustified travel expenses."
In their report, Health Canada auditors further allege the nurse accepted free flights and gave free diabetes drugs from the nursing station to someone at the airline who was not covered by private insurance.
Cousineau said he was not aware of anyone from Keeper River Airways accepting any free medication from the nurses.
Meanwhile, documents filed recently in Federal Court show the Canada Revenue Agency is still trying to collect a significant amount of money from Keeper River Airways.
According to Health Canada, Keeper River Airways inflated the distances travelled on some invoices, resulting in an overcharge of $103,689.
"The auditor went over that with me. I don't know, within a few miles, those mileages were accurate," Cousineau said. "So I don't know what the heck they were complaining about there."
He acknowledged he has yet to fully pay back the government.
"They're still trying to collect from me, but the company just went belly-up, broke," he said. "It went to court. I couldn't afford to go to court, so of course they won."
In June, the Canada Revenue Agency directed the sheriff of Kenora, Ont., to seize and sell Keeper River Airways' property.
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