Tuesday, I reported that a former employee of Preventive Health Strategies has taken Annette Bosworth to court over unpaid wages. Former PHS executive director Mathia Rall is seeking payment of three skipped paychecks, plus overdraft fees and the double-wages penalty prescribed by South Dakota labor law (yes, South Dakota has labor laws).
When I called Bosworth's clinic to seek comment, Independent Medicine chief financial officer (and Bosworth's sister) Peggy Craig offered no comment other than that the claim related to Preventive Health Strategies and had nothing to do with Independent Medicine. (Independent Medicine is the formal name, on the incorporation papers, of Dr. Bosworth's business, which she brands as "Meaningful Medicine".)
Now on face, Craig's demurral seems to make sense. Rall was executive director of Preventive Health Strategies, Annette Bosworth and husband Chad Haber's non-profit. Rall has no medical licensures. She did not work for Meaningful Medicine.
So explain this paycheck, one of the last that Rall received:
Rall did not work for Independent Medicine. She worked for non-profit Preventive Health Strategies. Yet her August 2, 2012, paycheck came from the for-profit Independent Medicine business account.
Craig was apparently concealing the truth on the phone yesterday. She wrote Rall's check. She wrote it on the Independent Medicine account. Whether Rall received her paychecks or not appears to relate very much to activities in the clinic.
Among the questions Craig's obfuscation raises is how this mingling of corporate entities fouls the tax situation for Dr. Bosworth. Her clinic wrote a check to someone who is not an employee. Independent Medicine can't deduct that expense as wages. The clinic can't deduct that expense as a charitable contribution, because the money went to an individual, not the non-profit PHS.
This confusion hearkens back to a concern Bosworth's activities have raised since an employee of her non-profit agency leaked her political designs in early June. The organizational walls between Bosworth's for-profit medical practice, her non-profit, and her political campaign seem very porous. It's hard to tell where one ends and the other begins, to the point where the mingling appears to break the law.