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Hospital trustee resigns due to disagreements over MaineHealth plan

Epstein says board ceding control of hospital without considering alternatives

CONWAY — A Memorial Hospital trustee who resigned in protest over a proposed partnership with Maine Medical Center is speaking out about his decision and accusing hospital officials of failing to do basic research in considering the plan.

"I recently resigned from my most recent stint as a result of the board's decision to move forward to become essentially a wholly-owned subsidiary of MaineHealth (the Maine Medical Center holding company)," George Epstein wrote in a column he submitted to the The Conway Daily Sun Tuesday. "This was done with no serious effort to consider alternatives, or even a determination of whether there is any need to cede control of the hospital at this time. Despite my participation in or monitoring of more than 100 mergers and acquisitions, I have never seen a process move forward with so little information, board involvement, or consideration of alternatives. Should we hand over a crucial institution and $50 million asset without a modicum of due diligence?"

Epstein's critical review of the performance of his former peers comes less than a week before Memorial Hospital executives plan to present the proposal to the community. Hospital officials scheduled a community information meeting for Monday, Nov. 19 from 5:30 to 7 p.m. at the Red Jacket Motor Inn in North Conway. "Hospital board of trustees Chair Gene Bergoffen and CEO Scott McKinnon will briefly outline details of the potential partnership with MaineHealth and what it means for Memorial and health care in the Mount Washington Valley," Memorial said in a statement released last week. "Patients of Memorial Hospital and members of the Mount Washington Valley community are encouraged to attend."

The partnership is for the long-term strategic future of the hospital, according to officials.

"We can't do it on our own," Bergoffen said. In the long run operating a small regional hospital in a rural community will require partnerships.
McKinnon echoed Bergoffen: "We feel that we need a strong partner for the future," he said. "We believe we have the right partner."

Memorial is still early in the process, he said. There are between six months to a year left of due diligence and regulatory oversight required before this partnership can happen, he said. Many specific questions will be answered in that time.

An important point, he said, is the conversation is happening with the hospital in a good position. "We're not entering this in financial stress," he said.
But while Epstein agrees affiliation of some type is likely inevitable, he is concerned the trustees are blindly moving towards this partnership without considering other alternatives. He was appalled by "really the lack of process that led to this action," he said in a phone call on Wednesday.

The trustees voted to enter a letter of intent with MaineHealth without holding similar conversations with Dartmouth/Hitchcock, Wentworth-Douglas, Center Maine or any other of a host of health care networks that would provide comparable services, he said. Furthermore, the board failed to ask basic questions about how other hospitals benefited from partnering with MaineHealth before making this decision.

"What would you do if it was your organization?" he said.

Epstein has been on boards for decades, including a stint as chair of the hospital trustees in the 1980s. He also serves as a University of New Hampshire trustee. He's been on the losing end of discussion before, he said, and "I've never reached a point where I felt like I needed to resign."
But "this is different," he said. This is a once in a lifetime decision concerning the future of one of "the two most important institutions in our valley."

"Such drastic action was being done with so little information," he said.

McKinnon and Bergoffen, however, don't see it that way.

"I disagree with his point that there hasn't been due diligence," Bergoffen said. "The board as a whole disagreed." A special committee visited hospitals within the MaineHealth network and talked to board members and employees. "We've documented all of our efforts," he said. "I respect [Epstein's] argument," but "we did a very rigorous thought process."

Furthermore, he said, this isn't just a decision for the Memorial trustees. "This agreement must pass muster with the Office of Charitable Trusts," a division of the N.H. Attorney General's office.

MaineHealth is the obvious choice, McKinnon said, since the bulk of Memorial's referrals already go to Portland. "Any kind of redirection would be very difficult," he said.

MaineHealth is also the only entity offering the level of autonomy the trustees wanted, he said, and geographically Portland is a natural fit.
"[Epstein] did have a very different take," he said, "but it was a minority opinion."

Epstein, however, was on the committee considering the partnership and was very unsatisfied with what he saw. There were site visits to other MaineHealth affiliate hospitals where people spoke very favorably about MaineHealth, he said, but "any documentation that supports these positive statements seems to not exist." He wanted to see financial documentation for partner hospitals comparing the year before the affiliation with the year after to give him a better idea about the impact, but that wasn't available.

McKinnon said he and other Memorial officials had conversations with other hospitals about the impact of joining MaineHealth, but the specific documentation Epstein was looking for was not provided. "What they told us is they saw immediate advantages," he said.

"We have not seen a pre and post analysis," he said, but then this isn't a decision being made primarily for financial reasons. This is about sustainability, he said, and MaineHealth is "the most logical partner."

That is impossible to know, however, according to Epstein, because alternatives weren't examined. "The question is very simple," he said: if other options were considered there should be alternative proposals out there. "I can tell you, no such options exist."

Epstein is hoping the community will come out to the meeting on Monday to ask this question and others. "There is an opportunity to stop the process at this point," he said. It is up to the community to press hospital officials about their decisions and demand they look at the issue more broadly. "The hospital has failed to follow its own guidelines," he said. "This is a really big deal."
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