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*** UPDATED x1 *** Lawsuit alleges Chicago hospital participated in “pay to play” with Sandoval, Madigan

Wednesday, Jul 21, 2021

* Law Street Media

On Friday, a lawsuit was filed against Saint Anthony Hospital in the Northern District of Illinois. The suit was brought by former employee Stella Wolf who stated that the hospital and its president, Guy Medaglia, participated in discriminatory and retaliatory practices, including inappropriate behavior towards female employees and illegal hiring practices. The plaintiff said that her objection to these practices ultimately resulted in her termination. […]

This hostility only increased after Medaglia requested that the plaintiff create three unnecessary positions for a Illinois Senator’s son, daughter, and the daughter’s boyfriend. Medaglia apparently told Wolf that state Sen. Martin Sandoval, who later pled guilty to federal corruption charges, would be giving them a $5,500,000 grant to the hospital in exchange for this favor.

Wolf opposed this move and believed that doing so would be illegal under Illinois law. The defendant then decided to circumvent her authority and instructed another HR member to draft salary offers to the three prospective employees. Wolf claimed that these offers were far above what a person of their position would ordinarily be paid.

Wolf was asked on another occasion to terminate the current insurance broker and hire the son of the then-Speaker of the Illinois House of Representatives Michael Madigan, which Wolf refused to do. After these requests, Medaglia began blaming Wolf for their lack of funding.

* From the lawsuit

Nevertheless, Wolf continued to object to what she believed were Medaglia’s illegal actions. For example, Wolf opposed Medaglia’s June 2019 instruction to create two unnecessary positions for Senator Martin Sandoval’s two adult children and daughter’s boyfriend (Jennifer Sandoval, Martin Sandoval, Jr., (“Sandoval II”), and Matthew Castillo) in exchange for a $5,500,000 state grant Sandoval secured for the Hospital. At the time, Sandoval was already under investigation for public corruption and has since pleaded guilty to federal charges before dying on December 5, 2020.

Faced with Wolf’s opposition, Medaglia circumvented her and ordered a Director of HR to draft offer letters with salaries for Ms. Sandoval, Sandoval II, and Castillo, which were not consistent with their positions. SAH then employed all three.

SAH was awarded a second $5,500,000 state grant that summer, which was paid out September 17, 2019.

Medaglia made frequent, publicly reported contributions to Sandoval family political campaigns.

Later that summer, Medaglia explained that then-Speaker of the Illinois House of Representatives Michael Madigan had requested that his son, Andrew Madigan, replace the Hospital’s existing insurance broker. To that end, Medaglia instructed Wolf to share the Hospital’s current rates with the younger Madigan so he could undercut them.

Wolf objected to the Madigan scheme, noting that their current broker had been providing exemplary service and significant savings. Despite Medaglia’s insistence that in Chicago you “pay to play” and this was one of those times it was necessary to play, or words to that effect, Wolf insisted on securing three competitive bids. As a result of that process, Wolf recommended remaining with the Hospital’s current broker.

Medaglia blamed Wolf for a lack of financial support from the State in a leadership meeting, noting that Senator Sandoval was by then under indictment for political corruption and Madigan was “not happy with us,” or words to that effect.

Keep in mind that people can and do allege quite a bit of stuff in lawsuits that turns out not to be true. Also, I’ve reached out to Madigan’s folks for comment and will update if I hear back.

*** UPDATE *** Sun-Times

The hospital does not comment on pending litigation or “debate speculative claims,” said Ryan B. Jacobson, an attorney and spokesman for Saint Anthony Hospital.

“We deny any wrongdoing, and fully expect the evidence will prove Ms. Wolf’s accusations are unfounded, if not entirely fabricated,” Jacobson said in a statement.

A Madigan spokeswoman did not immediately comment. Craig Tobin, who had represented Sandoval in a separate federal lawsuit, told the Chicago Sun-Times, “I’m unable to make a comment because my former client’s deceased.

“I do find it a little incredulous that those types of direct statements would have been made,” Tobin said, adding that Sandoval was “not a novice, politically.”

- Posted by Rich Miller        

23 Comments »
  1. - All This - Wednesday, Jul 21, 21 @ 7:16 am:

    I’m having trouble understanding how you can have competitive bids for insurance brokers. Aren’t the brokers paid by the insurance companies instead of the client? And don’t they all work with the same insurance companies?


  2. - the Edge - Wednesday, Jul 21, 21 @ 8:40 am:

    The broker should be working for you, and not giving you advice based on the size of their commission. The rfp will ask a broker to provide their best flat fee for service and specify they will not receive a commission. this would be similar to a recordkeeper for a 401k being paid a flat fee and not a fee based on the value of the investments.


  3. - RNUG - Wednesday, Jul 21, 21 @ 9:04 am:

    Brokers don’t always work with all the companies; often they only represent a handful. I suspect the competitive bids were by differing insurance companies, trying to cut out another company. If it was for a multi-year contract, it’s likely a company on the outside offered a discount for at least the first year, counting on subsequent years to make up for the initial loss.


  4. - blue line - Wednesday, Jul 21, 21 @ 9:04 am:

    this is not the first instance where companies were asked to fire their broker and hire andrew madigan. its like being held up and robbed. extortion.


  5. - Paddyrollingstone - Wednesday, Jul 21, 21 @ 9:20 am:

    I find it hard to believe that Madigan requested anything. It doesn’t work like that when done correctly.


  6. - Shield - Wednesday, Jul 21, 21 @ 9:31 am:

    If it’s true, why wouldn’t she go to the FBI?


  7. - Rich Miller - Wednesday, Jul 21, 21 @ 9:31 am:

    ===why wouldn’t she go to the FBI? ===

    Do you know that she didn’t? Kinda betting they’ll be reaching out soon, though.


  8. - Oswego Willy - Wednesday, Jul 21, 21 @ 9:38 am:

    What got my interest… Sandoval angle and jobs…

    … but how the Madigan’s son move… how did that get to the point of this plaintiff? Were there “buffers”? Was this a plan of the hospital, being “pro-active” to seek favor? Was there a direct “A to B” pitch by Madigan’s son… out of any timing of a change?

    I’m sure the Feds might have these same questions… unless they already know the answers, which I don’t know where that might be.


  9. - All This - Wednesday, Jul 21, 21 @ 10:25 am:

    == this is not the first instance where companies were asked to fire their broker and hire andrew madigan. its like being held up and robbed. extortion.==
    I haven’t read about the other time. Maybe I missed it. Can you tell us about the other time?


  10. - Candy Dogood - Wednesday, Jul 21, 21 @ 10:32 am:

    ===If it’s true, why wouldn’t she go to the FBI? ===

    I think Illinois has a well established history of people being involved in, impacted by, or failing to stop criminal schemes that weren’t reported to the FBI.

    ===Keep in mind that people can and do allege quite a bit of stuff in lawsuits that turns out not to be true.===

    What’s great about Illinois is that even if the allegations are false, it does sound a lot like something we’ve grown to expect. I would hope a competent attorney wouldn’t allege inappropriate hiring if those people had not actually been hired.


  11. - Back to the Future - Wednesday, Jul 21, 21 @ 11:04 am:

    Great kick off story for the Team Pritzker Campaign.
    Of course, the children could be great hires for the hospital and the Pritzker Administration award of 5.5 million could be a great way to spend taxpayers money.
    In terms of assuming the lady making the complaint did not already contact the FBI or some other law enforcement agency may be a bit premature.
    The FBI only has so many agents and time to chase corruption in Illinois. Frankly I would rather have them chase terrorists than Illinois political folks, but since all the convictions and investigations has not had much of an effect I suppose going to the FBI is one of few choices citizens have.
    Perhaps it is time for voters to reflect on the kind of government we have been voting into office and vote for change.


  12. - Oswego Willy - Wednesday, Jul 21, 21 @ 11:08 am:

    === Great kick off story for the Team Pritzker Campaign.===

    “Because Madigan” vs. $300,000 a day against (possibly) a Trumpkin…

    This is more hope that’s like quicksand.

    Madigan is baked in, who exactly is going to say.., “the hospital… that’s it, that’s the straw”

    (Sigh)

    I’d be more worried about certain Trunpkin type gubernatorial candidates having great days heading towards a primary


  13. - Back to the Future - Wednesday, Jul 21, 21 @ 11:18 am:

    Good point on the hospital story not being the thing that turns voters off on Pritzker.
    Just tired of these kinds of things popping up all the time in Illinois.


  14. - Pizza Man - Wednesday, Jul 21, 21 @ 11:29 am:

    The senator’s kids with perks….”don’t ya worry about your resume or experience…I got this.”

    per the Suntimes last year…

    https://chicago.suntimes.com/politics/2019/11/27/20984780/state-senator-martin-sandoval-relatives-cta-payroll-pace-transit-federal-investigation


  15. - 17 etc. - Wednesday, Jul 21, 21 @ 2:05 pm:

    …”don’t ya worry about your resume or experience…I got this.”

    The Sun Times article you cited says they had experience and good resumes.

    “CTA spokesman Brian Steele said Sandoval’s relatives ‘went
    through the same hiring process as anyone,’ with the agency’s human resources arm vetting them. Both women had solid backgrounds, with Sandoval’s daughter-in-law carrying a master’s degree and considerable work experience, according to another CTA official.”


  16. - Shield - Wednesday, Jul 21, 21 @ 2:05 pm:

    - Rich Miller - Wednesday, Jul 21, 21 @ 9:31 am:

    I don’t, but I also don’t think a competent attorney would advise filing a civil lawsuit before going to the proper channels for alleged criminal conduct.


  17. - Pizza Man - Wednesday, Jul 21, 21 @ 2:30 pm:

    @ 17 etc. these kids/daughters-in-law were connected. Period.

    As Trans. chairman, Mr. Sandoval oversaw the CTA’s request/needs. Allegedly they ‘had the experience’ which they did not –possibly only the daughter-in-law whose experience was primarily administrative and not in policy or legislative.


  18. - Amalia - Wednesday, Jul 21, 21 @ 2:41 pm:

    this is well known as a terrible hospital, bad quality of care there.


  19. - 17 etc - Wednesday, Jul 21, 21 @ 3:07 pm:

    “17 etc. these kids/daughters-in-law were connected. Period.”

    I’m not in a position to evaluate their experience. Are you? Do you work for the CTA?

    I reposted this comment since it was rejected, and left off a second part.

    The City of Chicago sets requirements, then uses a lottery system to hire people from a pool of people who meet those requirements. So nobody can say you got the job because of this or because of that. Perhaps other government entities should do the same.


  20. - Oxfordian - Wednesday, Jul 21, 21 @ 6:19 pm:

    == The City of Chicago sets requirements… ==

    The Chicago Transit Authority is a separate entity from the City of Chicago.


  21. - 17 etc - Wednesday, Jul 21, 21 @ 8:01 pm:

    “ The Chicago Transit Authority is a separate entity from the City of Chicago.”
    Yes it is. The Park District too. That’s why I said “perhaps other government entities should do the same.”


  22. - AnnieH - Wednesday, Jul 21, 21 @ 9:42 pm:

    Brings back memories of the time I was kicked off–excuse me, not reappointed–to a state board because I wouldn’t go along with making up a new $150,000 position for the daughter of a major donor. Really opened my eyes.


  23. - Da Big Bad Wolf - Thursday, Jul 22, 21 @ 9:34 am:

    ===this is well known as a terrible hospital, bad quality of care there.===
    Good thing they got that 5.5 million grant.


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