New York regulators to probe $660K payment to former CEO of SUNY Upstate Medical University

Reports surfaced in May that a former CEO of Syracuse, N.Y.-based SUNY Upstate Medical University was paid $660,500 for an off-campus assignment that involved no work. Now, the state comptroller's office will look into the payment, according to

The payment in question is a $660,500 payment to former hospital CEO John McCabe, MD, which was part of a confidential nondisclosure agreement.

Under the agreement, Dr. McCabe agreed to quit his role as CEO and no longer serve as a clinical staff member. Dr. McCabe was instead given the title of "senior assistant to the president," which allowed him to keep his CEO salary for 14 months.

In his assistant role, Dr. McCabe was supposed to provide administrative services to Upstate Medical's newly appointed president Danielle Laraque Arena, MD, when needed. The deal required him to work off campus.

Now, reports show no evidence that Dr. McCabe received work assignments. Instead, he read journals, chatted with personal contacts and searched for other jobs, according to

Dr. McCabe, at the time the secret payment was uncovered, said he wanted to return to Upstate Medical's faculty to teach after he left the CEO job, but he said discussions with Upstate gave him the impression that officials wanted him to "disappear."

The uncovering of the confidential agreement provoked the New York comptroller's office to audit Upstate Medical University's human resources practices. The audit will begin Oct. 1 and is expected to take six to 12 months, according to the report.

The secret payment also prompted Sen. John DeFrancisco, R-New York, to introduce a bill that would ban state and local agencies from using secret nondisclosure agreements.

Upstate will also be investigated by the state inspector general and the Onondaga County district attorney. The investigation will focus on the secret agreement between Upstate and Dr. McCabe, as well as Upstate Medical's hiring practices and construction projects.

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