Appeals Court Upholds Lease of Hospital
by William Woody
Oct 25, 2012 | 1228 views | 0 0 comments | 11 11 recommendations | email to a friend | print

MONTROSE – The lengthy and costly legal quarrel between the Montrose County Board of County Commissioners and the Montrose Memorial Hospital Board of Directors appears to be over. For now. But mending the relationship between the warring parties will require trust and confidence, Montrose County Commissioner Gary Ellis said Monday.

The Colorado Court of Appeals on Thursday upheld District Judge Jeff Heron's 2011 ruling in favor of the MMH Board of Trustees Oct. 2010 lease of the hospital to the newly created nonprofit Montrose Memorial Hospital Inc. for a period of 50 years. The appellate court dismissed the commissioners' claims that the county-appointed trustees violated state open meeting laws or illegally transferred a publicly owned hospital, and its assets, including cash, to a non-profit private corporation.

During the lease process, the hospital's trustees appointed themselves to the MMHI board of directors and leased the hospital from the board of trustees to the board of directors.

While the county commissioners argued that the transfer was a sale and not a lease of the county-owned facility, the court disagreed.

"The agreement specifies that upon termination, all leased assets shall be transferred to the trustees. Therefore it is a lease," the ruling read.

In a press release responding to the ruling, Ellis said he wasn't interested in further appeals, adding, "as far as I am concerned, that settles the issue." Ellis cast the dissenting vote a year ago when commissioners David White and Ron Henderson voted to further litigate the matter to the appellate level.

"I'm glad we have a final resolution in the hospital issue," Commissioner David White said last week in a statement. White is running for reelection to the Board of Commissioners, as is  Henderson. But White's statement contradicts an advertising mailer of his that posits that if he and Henderson are re-elected, the hospital litigation could continue. The statement, reads in part, that if their opponents are elected, the hospital will be "forfeited" to the hospital board of directors.


Montrose Memorial Hospital is one of Montrose's largest employers. The lease and subsequent litigation continues to fuel heated debate within the community with one polarizing question outstanding: Is the hospital better off with its new status?

"We trust they will make good decisions and act in the best interests of the citizens of Montrose," Ellis said.

The lease bars the county commissioners from any decision-making role at the hospital. They have repeatedly stressed that their oversight is critical in hospital operations.

"The county commission have in my mind as much to do with it (the hospital) today as they did 24 months ago, which is nothing. They never stopped into the (hospital) board meetings. They were kind of a non-entity then, and they are a non-entity now," MMH CEO Dave Hample said in an interview on Monday.

In May, Hample sent a letter to then-MMHI board chairman Stephen Glasmann urging him to draft a letter to the Board of Trustees advising them to find new meeting space away from the hospital.

"Having trustees in the administrative offices conducting their business or in meeting rooms of the hospital invites confusion on the part of the hospital staff and opens the potential for private patient or sensitive operational information to be compromised. Board of trustees should have no routine and ongoing business conducted in the administrative offices or anywhere else in the hospital," the letter read.

Hample also wrote that the trustees should assign a secretary with no ties to the hospital's administrative offices. Glasmann, who noticed the decision to trustee president Nancy Medlock in June, agreed. Since their relocation to another venue, the trustees have been meeting in the Montrose County administration building board room before finding permanent space at the offices of Region 10, located at 300 North Cascade Avenue.

The county-appointed trustees still have duties of taking monthly tours of the facility and reporting their efforts to the BOCC.

"They are responsible for making sure the requirements of the lease are met," Hample said.

This access issue at the hospital is an effort, Hample said, at keeping conflicting influences away from daily operations.

Hample said he drafted the May letter because he didn't want trustees, commissioners or anyone associated with the commission "hanging around," the administrative offices. Hample said the move was not designed to remove the public from the decision-making process, but rather to restrict the potential for political influence in local medical care.

During the MMHI Board of Directors monthly meeting on Oct. 9, the board elected Debra Harmon as its new chairperson.

"First and foremost, it's important that the hospital be left out of the political arena," Harmon said. Harmon added that the board meetings are open and said she encourages the public to attend.

"We look forward to moving into a future of more positive light and welcome the public and the BOCC to attend our monthly board meetings and learn of the challenges facing the future of healthcare and celebrate the accomplishments of the leadership team and employees we value so much," Harmon said.

Since the lease took effect, Hample said the hospital's employees have been supportive and have been kept informed about the process and litigation.

"One of our main missions here is to keep people focused on healthcare and let politics fight themselves in other venues," Hample said.

The MMHI Board of Directors meet at the hospital's board room on the fourth Monday of each month at 5 p.m. Meeting agendas are posted at the hospital's administrative offices.

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