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October 26, 2018

Final OK given to unification plan for MaineHealth's member hospitals

About MaineHealth

MaineHealth is a not-for-profit integrated health system consisting of eight local hospital systems, a comprehensive behavioral healthcare network, diagnostic services, home health agencies, and more than 1,500 employed and independent physicians working together through an Accountable Care Organization.

With more than 19,000 employees, MaineHealth is the largest health system in northern New England and provides preventive care, diagnosis and treatment to 1.1 million residents in Maine and New Hampshire.

Members include: Franklin Memorial Hospital/Franklin Community Health Network in Farmington; LincolnHealth in Damariscotta and Boothbay Harbor; Maine Behavioral Healthcare in South Portland; MaineHealth Care at Home in Saco; Maine Medical Center in Portland; Memorial Hospital in North Conway, N.H.; NorDx in Scarborough; Pen Bay Medical Center and Waldo County Hospital in Rockport and Belfast; Southern Maine Health Care in Biddeford and Sanford; Spring Harbor Hospital in Westbrook; and Stephens Memorial Hospital/Western Maine Health in Norway.

MaineHealth affiliates include MaineGeneral Health in Augusta and Waterville, Mid Coast Hospital in Brunswick, New England Rehabilitation Hospital in Portland and St. Mary's Regional Medical Center in Lewiston.

MaineHealth is also a significant stakeholder in the MaineHealth Accountable Care Organization in Portland.

Corporators of MaineHealth gave final approval Thursday to the unification plan in which MaineHealth's Maine-based hospital members will become a single not-for-profit entity on Jan. 1.

The action, which was taken at the corporators' annual meeting following two years of discussion, means that as of Jan. 1 Maine Medical Center, Southern Maine Health Care, LincolnHealth, Coastal Healthcare Alliance, Western Maine Health, Franklin Community Health Network and Maine Behavioral Healthcare will all be governed by a single board of trustees. Each local organization, however, will retain a local board that will have a significant role in overseeing the care delivered in each community.

The organizations oversee local health systems based in Portland, Biddeford, Norway, Farmington, Belfast, Rockport and Damariscotta as well as the Spring Harbor psychiatric hospital in Westbrook. These local organizations also include a range of physician practices and other healthcare facilities across an area serving 1.1 million people. The new, combined entity will have approximately 19,000 employees and more than $3 billion in annual revenues.

Memorial Hospital, a MaineHealth member in North Conway, N.H., is not unifying at this time because regulatory issues in New Hampshire put the process there on a different timeline. Also, two other current MaineHealth members, NorDx Laboratories and MaineHealth Care at Home, will not be unifying due to the unique scope of services they provide as non-hospital members.

"Getting all our local boards to agree on a plan that allows us to come together as one was not easy, but it was worthwhile," Susannah Swihart, chair of the MaineHealth Board of Trustees, said in a news release.

Here's why the unification was pursued

MaineHealth said the dialogue on unification began two years ago with the recognition that many rural health care organizations in Maine are struggling.

"The inability to deploy resources across a system of free-standing member organizations had become a significant problem for community hospitals in recent years, as many came under increasing financial pressure because of changes in the way health care is being delivered," it stated. "Relatively simple procedures have been moving into outpatient settings, while complex care has been moving to regional medical centers that can afford new technologies used by highly specialized providers.

"The result is that much of the revenue from surgeries and other procedures that sustained community hospitals in the past is no longer available to them, and many community providers are struggling. Those that aren't losing money are typically small hospitals designated as 'critical access hospitals' by the federal government, which makes them eligible for more favorable Medicare reimbursement. However, their financial position has also recently eroded."

Advantages of unification

MaineHealth said that with its members becoming a single organization on Jan. 1, resources will be able to flow more easily between and among various parts of the health care system.

"That's significant given that the MaineHealth system as a whole is financially strong, with the third best bond rating among New England health care systems, behind only Mass General's Partners system and Yale New Haven Health," it stated.

Concerns about loss of local control — which were expressed during numerous public forums over the past two years — resulted in the decision to keep in place local boards, which would become committees of the larger board of trustees.

"Under the plan, these local boards have a considerable role in each community, participating in quality oversight, oversight of local medical staffs, planning, budgeting and hiring of key executives, among other duties," MaineHealth stated.

"But it's more than just financial resources that can flow across the system," said William Caron, president of MaineHealth. "Clinical and operational expertise will also flow more easily across the system. For example, unification will help us to address the shortage of physicians and other clinicians in rural areas by more easily sharing staff across the system."

Unification also will help MaineHealth build a system of integrated care, supported by a common electronic medical records system.

"We've already made great progress coordinating care in areas such as cardiac care, cancer care and stroke care," said Joan Boomsma, senior vice president and chief medical officer of MaineHealth. "Unifying as one organization will make it easier for us to provide the best possible care as close to home as possible in every community we serve."

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