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UNC System head didn’t list corporate board seats that paid millions on ethics forms

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Chairman Harry Smith and Interim President Dr. William Roper cover topics like the future of Silent Sam and hiring a new chancellor in Chapel Hill as they meet with the media

William Roper, the interim president of the University of North Carolina system and former longtime CEO of the UNC Health Care System, failed to disclose his seats on the boards of major corporations between 2011 and 2019, at the same time as those corporations did business with the state, records show.

Roper, who is a medical doctor with a distinguished record of government service, served as the CEO of the UNC Health Care system from 2004 to 2019.

In January, Roper took the helm of the UNC System as interim president in the wake of Margaret Spellings’ abrupt departure.

Roper also still serves on the UNC Health Care System Board of Directors.

In that same time, Roper has served on the board of directors of DaVita, Inc, a company that provides dialysis services. Roper joined the DaVita board in 2002.

Roper has also been a member of the board of directors of three successor companies in the pharmacy benefits administration industry.

None of his corporate board service was disclosed on state ethics forms until last week, when Roper filed amended forms in response to an inquiry from WBTV for this story.

Roper’s corporate board service pays millions

First, Roper served on the board of MedCo, until 2011, when the company was purchased by Express Scripts. When that merger was completed, Roper assumed a seat on the board of Express Scripts from 2012 until 2018, when Express Scripts was purchased by Cigna, the insurance company.

Roper now serves on the board of Cigna.

Records show the corporate boards seats have been lucrative.

Annual reports filed by DaVita with the Securities and Exchange Commission show Roper made roughly $3.6 million in total compensation—cash, stocks and options—for sitting on the company’s board of directors between 2010 and 2018.

Proxy statements filed with the SEC by MedCo, Express Scripts and Cigna show Roper made at least $1.5 million in total compensation between 2010 and 2018. That total does not include compensation for two years — 2011 and 2018 — where Roper sat on the boards of one corporation that was bought by the successor company, thereby eliminating the need for the first company to file a proxy statement detailing compensation for board members.

The compensation from Roper’s board service is in addition to his salary from the state.

As CEO of the UNC Health Care System, Roper made a base salary of more than $800,000. As interim president of the UNC System, Roper’s base salary is $775,000.

Board service, state business not disclosed on state ethics forms

There is no law that prohibits state government employees from serving on corporate boards or from making extra income from private companies.

But service on private boards, private income and any business between those businesses and the state must be disclosed on a state employee’s statement of economic interest.

“The purpose of a statement of economic interest is to put both the public and the public body on notice that there are issues around which the individual may not be able to participate,” attorney Josh Lawson told WBTV.

Lawson served as general counsel at the North Carolina State Board of Elections and Ethics Enforcement until his resignation in late May. In that role, he was responsible for helping to enforce the state’s ethics act.

“It’s an expectation that you’ve gone through and done the due diligence to make sure that’s correct,” Lawson said of a covered person’s statement of economic interest. “It was so important that the General Assembly made it a law to require you to go through and answer every single question that applies.”

It is a misdemeanor to knowingly withhold material information from an SEI and a felony to knowingly make a false statement on an SEI.

A review of SEI’s filed by Roper between 2011 and 2019 — which covered calendar years 2010-2018 — show Roper did not disclose his board seats any of those years.

Roper only disclosed income from his board seats one year, on his SEI filed in 2017.

The omissions on Roper’s forms came as the companies on whose boards he sat conducted business with the state and engaged in research with and received patient referrals from the UNC Health Care System.

DaVita, Inc., the company that has paid Roper more than $3.6 million in compensation between 2010 and 2018, has two clinics listed for referrals on the website of the UNC Kidney Center.

Another web page tied to the UNC Kidney Center touts research being conducted by doctors at the hospital with support from DaVita.

A video promoting UNC Chapel Hill’s fleet of private aircraft documents a team of medical providers from UNC Hospitals traveling to the mountains of western North Carolina for a day to conduct kidney consults at a facility operated by DaVita.

Despite that, Roper never disclosed that he sat on the board of a company that had a referral and research relationship with the hospital he led at CEO.

MedCo and Express Scripts, two of the other companies on whose boards Roper served, was the pharmacy benefits manager for the State Health Plan.

MedCo administered the health plan’s pharmacy benefits in 2010 and 2011 until the company was bought by Express Scripts, which was the plan’s pharmacy benefits manager from 2012 through 2016.

The State Health Plan is administered by the Office of the State Treasurer and covers all state employees, including Roper and other UNC System Employees.

Express Scripts was advertised as the plan’s pharmacy benefits manager, including on the front cover of the plan’s open enrollment guidebook, for instance, and on the back of a state employee’s health insurance card, records provided by the Treasurer’s Office in response to a request from WBTV show.

But Roper neither disclosed his seat on the boards of MedCo or Express Scripts nor listed the fact that the company had a business relationship with the state, which is required.

Employees required to file SEI’s can opt to file a complete SEI form or file a “no change” form, certifying there was no change to their business dealings, stock holdings or income from the previous year.

Roper filed “no change” forms in 2012 through 2016 and in 2018. He filed a “long form” in 2011, 2017 and 2019.

The 2011 and 2019 forms only disclosed Roper’s holdings of stock and options in the companies whose boards he sat on. They did not disclose his income from the boards, which is required, nor did the forms include his board seats of the companies’ business dealings with the state.

Roper’s 2019 SEI disclosed the income he and his wife made from Social Security benefits but did not include his compensation from either corporate board.

Roper’s 2017 form did disclose income from both DaVita, Inc., and Express Scripts. Under the spot to describe the type of income, Roper listed “Directors fees – cash and equity.”

But under a different question on the 2017 form that asked to list and companies or businesses with which the filer was associated, Roper checked a box that said, “No Business Associations.”

Neither Roper nor a spokesman responded to multiple requests for an on-camera interview that WBTV first submitted more than a week ago.

WBTV later learned Roper left last week for a month-long vacation in Nantucket.

Roper amends SEI’s, still doesn’t disclose state business

Last week, in the wake of questions from WBTV for this story, Roper filed amended SEI’s for each of the years 2011, 2017 and 2019 disclosing the previously omitted information.

The amended disclosure forms for 2011 and 2019 included disclosures for Roper’s income from his service on the corporate boards and also list his seat on the two boards. The addendum filed to Roper’s 2017 SEI discloses his board service.

Roper announced the amended filings in a press release issued late Friday afternoon, days before this story was set to publish.

The statement included in Roper’s press release said the following:

“For the past several years, I have served on the boards of both DaVita, Inc. and of Medco/Express Scripts/Cigna, Inc. I have always publicly disclosed my role, interests and status as a shareholder and option-holder with each of these organizations to UNC Health Care, the UNC School of Medicine and to the UNC System.

Further, I have always recused myself from any matters before UNC Health Care, the UNC School of Medicine or the UNC System that might pose a conflict or the appearance of a conflict of interest related to my service with these outside entities.

It has recently come to my attention that a complete explanation of my status on the boards of these two organizations was not fully disclosed on several of my Statements of Economic Interest forms.

I have now amended my SEIs to reflect more fully and correctly these matters with the State Ethics Commission.”

But none of the new filings disclose a relationship between the State of North Carolina and the companies on whose boards Roper served.

Specifically, the amended forms list “none or not known” next to each company, as appropriate: MedCo, Express Scripts and DaVita.

Roper and his spokesmen have refused repeated requests for an interview for this story.

But Roper did personally respond to an email on Monday seeking clarification as to why his amended filings still do not disclose business between the companies on whose boards he served and the state.

“Over the course of the years that I have been on the referenced corporate boards, I have comprehensively and intentionally recused myself from any matters related to these companies. Thus, answering ‘none or not known’ to the question of whether the entities referenced have business with the State of North Carolina is entirely accurate,” Roper said. “Stated differently, I simply do not know — because I am totally recused. I have actively avoided getting that information, so that my decision-making would not be affected,” he continued.

But both Roper and a spokesman have refused repeated requests to provide documents showing instances when he had recused himself from decisions that may involve a company on whose board he served on.

Moreover, Roper did not respond to a follow-up question from a reporter asking why he claimed to have no knowledge of any business between the companies and the state even after a reporter sent a detailed request for an interview before he filed his amended forms that specifically included the business relationships between the companies and the state.

Lawson, the attorney and former general counsel, said Roper’s amended SEI filings are telling.

“I think you see that because he amended, he understands that there were things he was supposed to be disclosing that he didn’t initially disclose,” Lawson said. “Whether those amendments are, along, sufficient, I think is a question now.”

Lawson said he believed Roper should go further in making additional disclosures regarding his corporate board service to clarify to the UNC Board of Governors whether he used confidential information.

“It is concerning to me that there is no indication that the individual understood — Mr. Roper, Dr. Roper — understood that these entities are doing business with the state,” Lawson said.

“If he does understand that they were doing business with the state at that time, he should further amend his filings from that time to immediately notify the Board of Governors and the public indicating that, in fact, he didn’t do anything incorrect, that he was unaware at the time or that he did not act on information he would have gotten in his capacity conducting official business,” he continued.

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