Legislature could soon OK Mayo merger — without local lawmaker’s changes

The state legislation that’s required for Mayo Regional Hospital in Dover-Foxcroft to merge with Northern Light Health could be approved by next week, but it won’t include conditions proposed by a Piscataquis County lawmaker that would have given the towns that now own the hospital more control over the deal.

A bill allowing the merger was unanimously supported Tuesday, June 4 by the Legislature’s committee on state and local government, and will soon head to the House of Representatives for a vote, according to its sponsor, Rep. Norm Higgins, I-Dover-Foxcroft.

Given the committee’s unanimous vote, Higgins said that both chambers of the Legislature could pass the law by next week.

However, the bill won’t include a set of changes proposed last week by Rep. Paul Stearns, R-Guilford, that would have allowed the 13 towns more say over what happens to the hospital.

One of them would have liquidated any financial assets that Mayo Regional Hospital has at the time of the merger and distributed them to the towns, rather than let the funds be absorbed by Northern Light Health.

But few, if any, assets are expected to remain if the deal goes through. While Mayo Regional Hospital did have about $13.7 million in a reserve fund early this year, those funds would be needed to pay the hospital’s debts as part of the merger, according to CEO Marie Vienneau.

Another amendment proposed by Stearns would have given 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.

Under the merger, the hospital would become a nonprofit subsidiary of Northern Light Health, which is not paying any direct fee for the acquisition.

Twelve of the 13 towns that own the hospital have held votes supporting the merger, and Stearns has said that he supports it, too. But last week, he said his amendments were meant to ensure the towns have the option to hold onto what’s owed to them under law.

After conferring with other Piscataquis County lawmakers, Stearns told the committee on Tuesday that “the best course of action” was for the bill to go forward even though it did not include his amendments, according to a recording of the session.

“We got together and felt that it was in the best interest of the wishes of the citizens of the communities that we go ahead and move forward,” he said. “It was a complicated process. We wish everyone the best, and we hope there will be a hospital in Dover-Foxcroft for a long time.”

However, the proposed legislation does include several technical amendments proposed by state agencies.

The merger agreement approved by the boards of Northern Light Health and the group of towns that own the hospital would have exempted the transaction from state antitrust laws, which are generally meant to protect consumers and prevent business entities from forming a monopoly.

But that language was removed from the bill after Maine Attorney General Aaron Frey said in written testimony that he had “significant concerns” with it.

The merger requires legislative approval because it’s owned and overseen by a quasi-municipal entity, Hospital Administrative District 4, which has a charter that’s set in Maine law. The district includes Abbot, Atkinson, Bradford, Cambridge, Dexter, Dover-Foxcroft, Guilford, Milo, Monson, Parkman, Sangerville, Sebec and Willimantic.

Just one of those communities, Cambridge, opposed the merger during a round of advisory votes that were held in the district. Those votes were required by state lawmakers after the boards of Northern Light Health and the hospital district approved a 161-page merger agreement early this year without holding individual votes by the member towns.

Formerly known as Eastern Maine Healthcare Systems, Northern Light Health is a Brewer-based organization that includes nine other hospitals stretching from Portland to Presque Isle, including Northern Light Eastern Maine Medical Center in Bangor.

Supporters of the merger have said it will allow the small, rural hospital stay open after it suffered years of operating losses. It will also remove the liability from the towns that now oversee the facility. But the merger agreement only obligates Northern Light Health to maintain the hospital’s current services for five more years.

If approved by the Legislature, the merger would also have to be approved by state regulators.