The surprise recommendation by a state advisory board against Oregon Health & Science University’s proposed purchase of Legacy Health complicates the idea. But the unanimous vote does not end the matter.
On Monday, members of a community review board selected by the Oregon Health Authority to consider the closely watched deal voted unanimously to recommend disapproval under the state’s toughest-in-the-nation health care merger oversight law.
The vote caught many observers by surprise. It came even as some critics had questioned whether members of the state advisory board had conflicts of interest that could affect their impartiality, and whether the consultant leading the process lacked neutrality.
Two members of the board who were accused of conflicts resigned before the vote. The five who participated in Monday’s meeting initially split 3-2 against the OHSU purchase of Legacy.
But the two who’d favored approval of the merger — while attaching conditions to address critics’ concerns — changed their mind after hearing from the three who opposed it.
“There’s a concern that we just really aren't going to be able to put enough conditions out there with enough teeth,” said Wendi Martin, a human resources executive, who noted the argument that the merger would help staff beds and help rural areas.
“My vote will shift to disapprove with the hope that the two systems will continue to look for other options to staff those 500 beds, to get students and early career professionals out to the rural sites, and that the state is really going to stand behind Legacy and help solve some of their bigger challenges. There may also be an opportunity for OHSU to acquire or partner in a different way with specific facilities or specific sectors of Legacy. But ultimately, this is too big, with too many risks, for us to put enough regulators on.”
The news came as OHSU has waged a public relations campaign to highlight overcrowding at its facilities, which it says would be eased by the deal since Legacy tends to have more vacant hospital beds. Unions representing employees at the systems, noting a management commitment to boost Legacy wages to match OHSU’s, also support the deal.
The merged entity would dominate the greater Portland health care market, sparking critics’ concerns that it would violate federal guidelines and boost costs for local businesses and others struggling to pay premiums. Among the critics is former Gov. John Kitzhaber, who said the state should do more to help hospitals to help them stay independent in the face of financial challenges.
Leaders of the Oregon Nurses Association issued a press release following the review board’s vote saying they are confident the state will approve the deal.
“Oregonians face agonizing delays in accessing needed care due to lack of capacity at OHSU, while Legacy has beds that are going unstaffed,” said the union’s statement.
The health care merger oversight office of the state, which oversees the program, is not bound by the advisory board’s decision. Its recommendation could be issued as early as June.
Program staff earlier issued a report that acknowledged concerns about the deal’s potential effects, noting the entity would control five out of six hospitals in Multnomah County and seven out of 13 hospitals in the Portland area.
Gov. Tina Kotek has strong relations with the unions but a mixed relationship with OHSU. As first reported by The Lund Report, she received a subsidized staff member from the university. But that staffer later raised concerns about the influence of her spouse, Aimee Kotek Wilson, on state policy. Kotek also has exerted her influence to weigh in on decisions made by OHSU’s ostensibly independent board.
More recently Willamette Week has reported that Kotek exerted pressure on OHSU to close down its primate center, a focus for animal rights activists.
The law does not give Kotek an explicit role in the decision made by program staff. But the law also lacks safeguards inherent in other state health care merger review programs like the one in Massachusetts.
At least someone's paying attention!