METROWEST DAILY NEWS - Boston
Payout talks to be held in open: Hearing planned on money from medical center

By D. Craig MacCormack / News Staff Writer

Monday, June 2, 2003

FRAMINGHAM -- Selectmen will host a meeting with Natick selectmen and officials from MetroWest Health Inc. and MetroWest Community Health Care Foundation on June 18 to talk about a $46 million payout to the foundation.

Framingham officials want decisions about the distribution of the money to be made in public, unlike the closed-door approach to a vote in April about the sale of Health Inc.'s 20 percent stake in MetroWest Medical Center.

Health Inc. is questioning the charity status of the MetroWest Community Health Care Foundation, but foundation president Martin Cohen said Health Inc. is looking for a way out of the deal.

The Health Inc. board of directors voted unanimously last month to ask the Massachusetts Supreme Judicial Court to determine if the foundation violated a court order when it established itself as a private foundation rather than public in 1999.

Health Inc. -- 20 percent owner of for-profit MetroWest Medical Center -- decided to sell its minority share in February for a set price of $20.2 million to Tenet Healthcare Corp.

Tenet would become the full owner of the medical center, which has hospitals in Framingham and Natick, a Wellness Center on Rte. 9 and a downtown clinic.

The $20.2 million, as well as $26 million in hospital-related assets that would be transferred to the foundation, must be approved by a court order. If the court approves the transfer of approximately $46 million, the foundation will double in size.

The foundation was established with $43 million from the sale of the medical center to the state's first for-profit owner, Columbia/HCA, in 1996.

Health Inc. CEO Roger Peloquin said the foundation was never intended to be a private charity and is in violation of the 1999 court order, which states the foundation should be a public, not-for-profit entity.

Cohen said he believes the foundation's status as a private, non-profit charity is in line with the organizing principles set forth by the court, which say the foundation should make grants to municipalities and other non-profits.

Last month, the foundation submitted an application to open a health center on Hollis Street in Framingham with the help Great Brook Valley Health Center in Worcester.

The facility would provide health care to the uninsured and poor who lack dental coverage, mental health services and access to primary care. Because it does not have operating status, the foundation cannot run that facility.

With the transfer of money between Health Inc., Tenet and the foundation expected in July, Health Inc. will dissolve.