Rep. Stearns wants more local control over Mayo merger
As state lawmakers continue to evaluate a bill that would allow Mayo Regional Hospital in Dover-Foxcroft to merge with the statewide Northern Light Health system, they must also consider a recent proposal that would give more control of the process to the communities that now oversee the hospital.
The proposed amendment from Rep. Paul Stearns, R-Guilford, would liquidate any financial assets that Mayo Regional Hospital has at the time of the merger and distribute them to the 13 towns that now own the hospital, rather than let those funds be absorbed by Northern Light Health.
It would also give those towns the option to buy the hospital back for $1 if, after five years, it ceases to be operated as a critical-access hospital.
“My intent is not to jeopardize the merger moving forward,” Stearns said on Wednesday, as he presented his amendment to the Legislature’s committee on state and local government. “My intent is to give the committee options that they might use to extend the largest amount of protection possible of the assets to the towns.”
The ongoing merger is broadly supported in Piscataquis County, but the amendment comes on top of a series of other bills that lawmakers must consider by the end of this legislative session and could delay a merger that some officials say is urgent.
After Stearns presented his amendment Wednesday,May 29, the committee postponed discussion of it until either Monday or Wednesday of next week.
It did so after the bill’s sponsor, Rep. Norm Higgins, I-Dover-Foxcroft, said that he and the leaders of Northern Light Health and Mayo Regional Hospital had just learned of the proposed amendment that day and would need more time to review it.
He noted that the boards of those organizations have already approved a 161-page merger agreement that did not include such terms and that 12 of the 13 towns that own Mayo Regional Hospital held votes supporting the merger in its current form.
“If these amendments proceed, it dramatically changes the agreement,” Higgins told the committee. “I think it would need affirmative action from both participating parties.”
During an interview Friday, Higgins said that he and other Piscataquis County lawmakers will meet Monday morning to discuss the proposal with representatives of the two health care organizations.
The merger must be approved by the Legislature because Mayo Regional Hospital belongs to Hospital Administrative District 4, a quasi-municipal entity made up of 13 towns that was established by Maine law. The merger also requires additional approval from state regulators.
But before the Legislature’s committee on state and local government reviewed the law change, it called for all the district’s 13 towns to hold advisory votes on whether they support the merger.
Just one, Cambridge, voted against the proposal. All the other towns in the district supported it: Abbot, Atkinson, Bradford, Dexter, Dover-Foxcroft, Guilford, Milo, Monson, Parkman, Sangerville, Sebec and Willimantic.
Supporters of the merger say that it will help stabilize the finances of a small rural hospital that has suffered from years of operating losses and remove the liability from the towns that now oversee it.
On Friday, a spokesman for Northern Light Health said it is still reviewing Stearns’ amendment with Piscataquis County legislators and Mayo Regional Hospital officials.
Marie Vienneau, the CEO of Mayo Regional Hospital, declined to address the specific amendment. But she pointed to the affirmative votes of the district’s member towns and said “it would be inappropriate to now dramatically change [the merger] before allowing it to proceed.”
The merger agreement only requires Northern Light Health to maintain the hospital’s core services for five years. It also requires the dissolution of the district’s charter, under which the hospital’s assets are supposed to be divided proportionally among member towns if the district dissolves.
In an interview, Stearns said that his amendment could address some of the frustrations he’s heard from constituents who are concerned about those changes.
He also said that they should not greatly alter the path of the merger, as Mayo Regional Hospital officials do not expect it will have any cash assets by the time of the merger.
The district had $13.7 million in a reserve fund earlier this year, but it also had $9 million in debt and a $1 million line of credit, Vienneau said in March. If the merger goes through, the reserves would probably be used to pay the hospital’s debts, she said.
Northern Light officials have also said their goal is to keep running the Dover-Foxcroft facility as a hospital past the five-year mark. Under Stearns’ amendment, that’s when the towns would have the opportunity to buy the hospital back for $1 if it stops functioning as a critical-access hospital.
“At this stage, with the way health care is, I don’t think there is one town that would even consider taking on that hospital,” Stearns said. “But it’s their hospital and they should have an opportunity to take it back. Once again, if everyone does what they say they’re going to do — I have no inclination they won’t — that will be a moot point.”