This commentary is by Don Keelan of Arlington, a retired certified public accountant.
On July 1, the Southwestern Vermont Health Care Corp. and Southwestern Vermont Medical Center, along with its 11 affiliated companies, will come under the direct control (ownership) of Dartmouth Health, a New Hampshire nonprofit corporation.
Southwestern Vermont Health Care sent the request for approval of the asset transfer to the Vermont Attorney General’s office on Feb.17, 2023. Twenty days later, on March 9, the AG approved the transfer “of all or substantially all assets,” possibly one of the largest takeovers of a Vermont nonprofit. Ever.
This could be the best news the Bennington area could ever receive. Or it could be the most devastating news. Only time will tell.
Dartmouth Health has been one of the leading acute care, research and teaching hospitals in the United States for decades. For almost a dozen years, it has been affiliated with Southwestern Vermont Health Care, with its providers employed by Dartmouth Health.
For some time, the two institutions have cooperated in the application of telemedicine and sharing, when available, cancer care with the Dartmouth Hitchcock Norris Cotton Cancer Center collaborating with the Bennington hospital. When resources are available, patients needing more sophisticated medical care are sent to Dartmouth Health.
The parties executed the 28-page affiliation and integration agreement on Dec. 6, 2022, to take effect when regulatory approvals and due diligence were completed.
On page 18 of the agreement, it is noted that in Bennington, “the incidence of cancer is statistically higher than any other region in Vermont and considerably higher than the U.S. average.” The document notes that in orthopedics, “the population of the Service Area, one of the oldest in the nation, has a higher per capita demand for orthopedic services.”
Cardiology was also called out, noting that “patients in need of cardiovascular care currently leave the area to receive care.”
The agreement calls for good-faith intervention by Dartmouth Health by addressing the above and what is described as additional “foundational services” such as pulmonology, general surgery, gastroenterology, MRI and CT imaging, and others.
Section 3.8 of the agreement is concerning: “Dartmouth Health does not hereby make any financial commitment or guarantee with respect to these initiatives.” Dartmouth Health does commit (as long as funds are available) to provide $22,500,000 to cover 75% of Southwestern Vermont Health Care medical records and coding to the Dartmouth EPIC model. Southwestern Vermont Health Care will pick up the balance of 25% or $7.5 million-plus.
Dartmouth Health’s provision of mental health services is consistently absent from the agreement, a critical need in Bennington and its service area.
The transaction to transfer control of Southwestern Vermont Health Care to Dartmouth Health could be a win-win for the Bennington area; southwestern Vermont could surely use the Dartmouth Health resources.
However, we must pay attention to the downside, and I hope it was carefully evaluated. What is about to take place is that a local, 105-year-old nonprofit institution, the largest employer in Bennington County with over $200 million in assets ($200,219,775 per the Form 990s last Sept. 30), will give up control to an out-of-state nonprofit after nearly a dozen years of on-again, off-again negotiations.
Section 3.6.5 of the agreement states, “all unrestricted gifts made to SVHC and the SVHC Affiliates, whether prior to or after closing, will be used for the benefit of the (Dartmouth Health Systems-wide activities) Service Area.”
The signed agreement gives the Dartmouth Health board of trustees operational and capital budgeting control by becoming the Bennington corporation’s sole member. There is very little wiggle room to undo the deal if, for some reason(s), it does not work out. One exception is highlighted: if a for-profit enterprise takes over Dartmouth Health.
The Southwestern Vermont Health Care and medical center board signed off on the deal this winter, and hopefully they were given all the information needed to make their decision. Such information should have addressed the complexity of having the hospital and its service organizations adopt the EPIC medical records/coding conversion. This IT system is noted to be highly complex and fraught with an endless stream of updates. The staff has to adapt to changes, and that comes with an awful price.
As noted above, there is no guarantee that Dartmouth Health will offer additional providers. Dartmouth Health has yet to send many of its providers to Bennington in the past. It, too, needs help recruiting. It was reported this past January that it had 800 job openings. Even more disturbing was the follow-up announcement on Jan. 20, 2023: “the need to close a budget gap of $120 million by the end of September.”
Nonprofit boards of trustees are not infallible and serve as volunteers. Nevertheless, some tragic mistakes in judgment have occurred in our region in the past several years.
The most notable was the closing of Southern Vermont College, allowing the college president to be away for a year, over-expansion, and appointing a less than honorable person to be interim president.
The now-defunct Burlington College and the hospital in North Adams, Massachusetts, are other recent examples of unskillful judgments by boards of trustees.
I find parts of the agreement perplexing and not in the best interest of Southwestern Vermont Health Care. Even more bewildering is the almost complete silence of the takeover by local media, the business community, health care providers, government, and elected officials — local and state — and, of course, the patients.
After July 1, 2023, Dartmouth Health will be in charge. To paraphrase a Marine Corps motto, “Let us hope that the ghost of no Southwestern Vermont Health Care trustee will ever come back and say, ‘If only I had done my job.’”
