Mayo board votes 15-3 to start merger with Northern Light Health
DOVER-FOXCROFT — The public board that oversees Mayo Regional Hospital has voted to begin a merger with Northern Light Health, the statewide health care organization that’s based in Brewer and includes Northern Light Eastern Maine Medical Center in Bangor.
The board members, who are elected from 13 Piscataquis County communities served by the hospital and who oversee a quasi-municipal entity known as Hospital Administrative District No. 4, approved the merger agreement in a 15-3 vote — one board member was absent — during a meeting Wednesday night, Feb. 27.
The vote followed months of due diligence, planning, and gathering public input, as well as a board review of the agreement negotiated between representatives for Mayo Regional Hospital and Northern Light Health.
During the meeting, multiple board members said that joining a larger health care system is necessary for the community-owned hospital to continue operating after suffering years of operating losses.
Before approving the merger agreement, the board also voted 14-2 to inform the district’s member communities that they may have to pay taxes in the coming year to help the hospital pay back its debts. The board’s treasurer, Jensen Bissell of Milo, expressed his hope that the merger would go forward and improve the hospital’s finances enough that the tax wouldn’t be needed. But he said the ability to tax member communities would be an important backstop.
“This is a tool to put the ability to tax communities on the table,” he said. “We’ll be able to tell later in the year if we need to.”
The hospital administrative district board has the ability under its charter to levy taxes to support Mayo Regional Hospital’s operations.
He also questioned the timing of the earlier vote on taxing communities, calling it “a scare tactic” meant to raise support for the merger.
With the administrative district board’s vote behind them, hospital administrators now must seek various other key approvals for the merger to go forward, including from state regulators and the board of Northern Light Health, which runs nine hospitals stretching from Presque Isle to Portland, including one other in Piscataquis County: Northern Light CA Dean Hospital in Greenville.
“This vote is significant, but it’s certainly not the completion of our work,” Mayo Regional Hospital President and CEO Marie Vienneau said in a statement. “I’m pleased that this board voted in favor of ensuring quality care for this region.”
Mayo Regional Hospital administrators and board members are also pursuing state legislation that they have said is necessary for the merger to happen, because the district is governed by a charter that is set in Maine law.
For Hospital Administrative District No. 4 to be dissolved, the charter requires an affirmative vote by all of its member communities. Upon dissolution, the charter indicates that hospital assets must be divided proportionally among member towns.
But the legislation pursued by the hospital’s administrators would repeal the charter and remove the requirement that the member communities individually vote on ending the district, according to draft legislation that is included in the merger agreement.
If the merger goes forward, the hospital would become its own nonprofit organization affiliated with Northern Light Health.
The district’s member communities are Abbot, Atkinson, Bradford, Cambridge, Dexter, Dover-Foxcroft, Guilford, Milo, Monson, Parkman, Sangerville, Sebec and Willimantic. It’s now the only hospital administrative district remaining in the state.
Last week Vienneau said that joining the larger health care system will help keep Mayo Regional Hospital afloat after it’s suffered operating losses every year since 2010.
While the district has $13.7 million in a reserve fund, the hospital also has $9 million in debt, a $1 million line of credit and zero days of operating cash on hand, according to Vienneau. If the merger were to go through, the reserves would probably be used to offset the hospital’s debts, she said last week.
“The most important thing that we can do as a hospital is ensure access to quality care for the people who live here,” Vienneau said. “While rural hospitals nationwide are seeing similar challenges, we have the opportunity to ensure quality care for this region for the foreseeable future with an organization who understands rural health care in Maine, Northern Light Health. It’s our responsibility to take that opportunity on behalf of the people counting on that care.”
Similar to Northern Light Health arrangements with other hospitals, Mayo and its clinics would remain open under the merger, and providers could continue providing quality care to people living in Piscataquis County.
“This vote by HAD 4 is a key step forward in the proposed merger of Mayo with Northern Light Health,” said Michelle Hood, FACHE, president of Northern Light Health, in a statement. “We already partner with Mayo to deliver a variety of clinical services like obstetrics and cancer care. We look forward to exploring an even closer relationship that harnesses our collective strengths for the greater good of those who live in Piscataquis County. While our work is by no means complete, this vote enables Mayo and Northern Light Health to continue our dialogue.”
“Northern Light Health has been sensitive to the unique nature of our board, and the rural health care needs of the people in this region,” Vienneau said. “If this hospital becomes part of the Northern Light Health system, people in this region will see continued quality care, and could feel confident in the future of Mayo Regional Hospital.”