MaineHealth defends top executives’ pay despite major cuts

Posted June 07, 2014, at 10:38 a.m.

MaineHealth, which oversees the health care system for much of southern Maine, says the pay for its top executives is reasonable, even as the organization cuts jobs.

Last month, Pen Bay Healthcare — a MaineHealth affiliate — announced $2 million in cuts to reduce a projected $2.7 million operating loss. That included the non-renewal by year’s end of a contract with an oncologist who exclusively serves Pen Bay.

Last fall, citing low patient counts and other financial concerns, Lincoln County Healthcare — another MaineHealth member — closed the emergency room at St. Andrews Hospital in Boothbay Harbor. The hospital became an urgent care center without an ER, inpatient services or the ability to accommodate critical care patients. Lincoln County Healthcare also includes the 25-bed Miles campus hospital in Damariscotta.

That action, however, was fought by local residents. Last week the state announced Lincoln County Healthcare must again provide urgent care 24-hours-a-day, 7 days a week in the Boothbay area.

The MaineHealth system is anchored by Maine Medical Center in Portland, the state’s largest hospital with 606 beds. Hospitals that have joined MaineHealth include Lincoln County; Pen Bay Healthcare, which includes the 99-bed Pen Bay Medical Center in Rockport; Waldo County Healthcare in Belfast; Southern Maine Healthcare, which includes a 150-bed hospital in Biddeford and a 58-bed hospital in Sanford; Western Maine Healthcare, which includes 25-bed Stephens Memorial Hospital in Norway; and Maine Mental Health Partners, which includes Mid-Coast Mental Health Center.

MaineHealth’s network also includes NorDx, which handles laboratory services, and Synernet, which handles medical transcriptions, credentials verification, clinical engineering and workers’ compensation insurance.

William Caron Jr., the president of MaineHealth, was paid $1,170,612 in the fiscal year that ended Sept. 30, 2012, according to the nonprofit corporation’s federal income tax return. This was an increase from the $1,128,006 Caron was paid in 2011.

The 2012 filing is the most recent one filed. The 2013 filing is expected later this year.

Frank McGinty, executive vice president and treasurer for MaineHealth, was paid $752,572 in 2012. This is an increase from 2011, when he was paid $661,734.

Mark Biscone, executive director of Waldo County Healthcare and current interim chief executive officer for Pen Bay Healthcare, was paid $475,315 in 2012. This was an increase from $421,052 in 2011 and $369,500 in 2010. Biscone was appointed interim head of Pen Bay in March 2014. Waldo County includes the 25-bed Waldo County General Hospital in Belfast.

In 2012, then Pen Bay Healthcare President and Chief Executive Officer Roy Hitchings Jr. was paid $328,211 for the 2012 fiscal year. Hitchings retired in February 2012 and was succeeded by Wade Johnson. Johnson’s pay is not listed in the 2012 tax filing by Pen Bay Healthcare. Johnson resigned in February 2014 and has been succeeded on an interim basis by Biscone.

Hitchings was paid $427,764 in 2011.

Lincoln County Healthcare President and Chief Executive Officer James Donovan was paid $336,372 in 2012. This was an increase from $307,812 in 2011.

Western Maine Healthcare President and CEO Timothy Churchill was paid $352,094 in 2012, up from $329,163 in 2011.

Southern Maine Healthcare President Edward McGeachey III was paid $522,397 in 2012. This was an increase from $447,882 in 2011.

NorDx President W. Stanley Schofield was paid $447,098 in 2012, up from $443,817 in 2011.

Maine Mental Health Partners Chief Executive Officer Dennis King was paid $472,269 in 2012, up from $427,379 in 2011.

George Isaacson, chairman of the board of trustees for MaineHealth, said the pay for senior management in MaineHealth has not kept up with the pay of comparable health care organizations across the country.

Isaacson, a Portland attorney who is a volunteer board member, said MaineHealth has attempted to keep its senior management pay at the 50th percentile of comparable organizations, but that has slipped during the past several years. As MaineHealth grows, he said, it must compare itself to larger health care organizations.

“When we look for talent, it’s often nationwide,” he said.

The compensation for officers of the organizations within MaineHealth is voted on by the MaineHealth Board after annual evaluations are done and an analysis of compensation by an internal executive committee. MaineHealth also uses an independent compensation consulting firm — Sullivan Cotter Associates Inc. — and an industry survey.

Isaacson said the compensation for administrators at the regional centers such as Pen Bay Healthcare must be approved by the MaineHealth Board but is decided by the regional boards that are more aware of local issues.

Biscone said the $2 million in cuts at Pen Bay Healthcare included administrative positions. He also said the organization will be saving at least $200,000 this year with him serving as head of both Pen Bay and Waldo County.

Biscone reiterated that regionalization of health care will continue in order to best serve patients at a time of financial pressures for all hospitals and health care operations.

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