Fremont Health Medical Center

The Fremont Health Board of Trustees approved a proposal to form a strategic partnership with Nebraska Methodist Health Systems (NMHS) during a special meeting on Monday.

The Board of Trustees unanimously voted to approve the proposal, which if passed by the Dodge County Board of Supervisors, would create a new organization known as Methodist Fremont Health that would be a subsidiary of NMHS.

“Last Thursday the Methodist System board (NMHS Board of Directors) unanimously approved making a proposal to us, and they are really excited about having us join their system if everything works out,” Pat Booth, President of Fremont Health, said at the meeting.

Under the proposed partnership agreement, Fremont Health would essentially be split into two organizations, according to Booth.

“The overall landscape of what is now Fremont Health, sort of splits in two,” he said. “Fremont Health becomes Fremont Community Health Resources and on the other side a brand new organization is created called Methodist Fremont Health, so we would be one of (NMHS’) hospitals.”

According to Booth, NMHS agreed to name the new organization Methodist Fremont Health for the foreseeable future and that organization would continue to operate the Fremont Health Medical Center, Fremont Health Clinic, and Fremont Health Partners.

Fremont Health would be renamed as Fremont Community Health Resources and would remain in existence to manage net proceeds, manage the current pension plan and ensure that agreements with Methodist Fremont Health and NMHS are fulfilled.

Fremont Community Health Resources would be governed by a three-member board that would be appointed by the Dodge County Board of Supervisors.

While the Fremont Health Board of Trustees endorsed the proposal, the partnership has to be voted on by the Dodge County Board of Supervisors to be finalized.

Fremont Health will be presenting the details of the proposed partnership to the Dodge County Board of Supervisors at its meeting on Tuesday morning.

While Fremont Health will be presenting the particulars of the proposal on Tuesday, the Dodge County Board of Supervisors will likely not make a vote on the proposal until its scheduled meeting on July 18, according to Booth.

The Dodge County Board of Supervisors meeting on Tuesday begins at 9 a.m. on the third floor of the Dodge County Courthouse.

According to information released by Fremont Health, some of the key agreements within the partnership proposal would include:

  • Fremont Health will lease land, buildings, etc. to the new subsidiary of NMHS – Methodist Fremont Health – for a 50-year lease term. The lease will include yearly rent of $3.3 million a year for 20 years, totaling $67 million. Methodist Fremont Health would then have the option to purchase the land and buildings after 20 years of rent payments for $1 subject to the pension plan obligations having been satisfied prior to exercise of the purchase option.
  • Methodist Fremont Health would also purchase substantially all of the assets of Fremont Health and assume all of the liabilities of Fremont Health other than its pension plan assets and liability. Fremont Health would retain $5 million in cash, working capital in excess of $13.5 million and cash and assets limited as to use in excess of $16 million. Methodist Fremont Health would assume all liabilities of Fremont Health including bank debt except for the pension plan liability.
  • Seven Fremont-area residents would sit on the Methodist Fremont Health board consisting of 9-12 members, and two of those seven members would have seats on the NMHS board.
  • All employees in good standing would be offered employment at comparable wages and benefits, and medical staff privileges would be preserved.
  • Key services would continue to be provided for at least 10 years, with changes after that time needing local board approval.
  • Methodist Fremont Health would invest at least $30 million in capital over the next ten years, with charity care guidelines remaining similar to the current Fremont Health guidelines.
  • Fremont Health Foundation would remain in place, with all current gift agreements being honored including naming recognition.

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