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  • Acts
  • 2000
  • Chapter 211 AN ACT RELATIVE TO HALE HOSPITAL IN THE CITY OF HAVERHILL.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:


SECTION 1. Chapter 569 of the acts of 1985 is hereby amended by striking out section 1 and inserting in place thereof the following three sections:-

Section 1. For the purposes of this act the following words shall have the following meanings:-

"Board", the board of trustees of the Hale hospital.

"City", the city of Haverhill.

"City council", the city council of the city of Haverhill.

"Health care purchaser", an entity licensed or authorized to do business in the commonwealth under chapter 175 of the General Laws, organized under chapter 176A, 176B or 176G of the General Laws; approved under chapter 176I of the General Laws, a health plan purchasing cooperative, or any other entity that enters into arrangements with health care providers to provide services on behalf of a defined population.

"Hospital", the Hale hospital.

"Mayor", the mayor of the city of Haverhill.

"Medical practice", an individual, professional corporation, limited liability company, medical group practice or similar entity that engages in providing professional medical services.

"Service area", the geographic area defined from time to time by the board as the area within which the hospital provides services. The service area may include portions of New Hampshire.

Section 1A. (a) The hospital established and maintained by the city shall be designated and known as the Hale hospital. All provisions in any special law that refers to the Hale municipal hospital, the Haverhill Hale municipal hospital, the Haverhill municipal (Hale) hospital, or similar designation shall be deemed to mean the Hale hospital. All presently existing legal rights and obligations created by statute, contract or otherwise pertaining to the hospital shall be deemed to be rights and obligations of the Hale hospital.

(b) The person who functions as chief executive officer of the Hale hospital shall be referred to as the chief executive officer. All provisions in any special law that refers to the administrator or director of Hale hospital shall be deemed to mean the chief executive officer of the Hale hospital.

Section 1B. The city of Haverhill may issue refunding bonds for the purpose of paying or refunding all or any designated part of its bond then outstanding issued under chapter 451 of the acts of 1978. Except as provided in this act the issuance of refunding bonds, the maturities and other details thereof, the security therefor, and the rights, duties and obligations of the city in respect to the same shall be governed by the applicable provisions of said chapter 451 relating to the issuance of bonds other than refunding bonds, including the provisions of section 1A of said chapter 451 relating to establishment of a hospital debt service fund. The refunding bonds may be issued in amounts sufficient to pay or provide for the payment of the principal of the bonds being refunded, together with any redemption premium thereon, any interest accrued or to accrue to the date of payment of such bonds, the expenses of issue of the refunding bonds and the expense of redeeming the bonds being refunded. Such refunding bonds may be issued at one time or from time to time and may be refunded by the issuance of additional refunding bonds under the act; provided, however, that no refunding bonds shall be payable over a period longer than 30 years from the date of the original bonds issued under said chapter 451. For each issue the amounts of principal and interest payable in each year shall be determined in accordance with said chapter 451 beginning with the earliest stated principal maturity date for any of the bonds being refunded. If such refunding bonds are issued prior to the maturity or redemption date of the bonds, the proceeds thereof together with other moneys then available or to become available to the city, which moneys may include income to be derived from the investment of such proceeds, sufficient to pay or provide for the payment of the principal, redemption premium, if any, and interest on the bonds so refunded to the date fixed for their payment or redemption shall be held in a separate fund and in trust solely for the payment of such principal, redemption premium and interest. The funds so held may be invested pursuant to section 55 of chapter 44 of the General Laws and the income derived from such investment may be expended to pay the principal, redemption premium, if any, and interest on the bonds being refunded until they are paid or redeemed; provided that notwithstanding any limitation on the maturity of investments under said section 55, any such investment may have a maturity not later than the date fixed for the payment or redemption of the bonds being refunded. Upon payment of the refunded bonds or establishment of a refunding trust in accordance with this section, any hospital debt service fund established under section 1A of said chapter 451 for the bonds being refunded and any trust agreement or credit agreement executed in connection with the issuance of the bonds being refunded may be terminated or modified so as to apply to and provide security for the refunding bonds; provided, however, that any moneys in such a hospital debt service fund on the date of issuance of the refunding bonds that the city treasurer determines to be unnecessary to pay debt service on the refunded bonds shall be credited to the city's unreserved general fund balance.

SECTION 2. Section 3 of said chapter 569 is hereby amended by striking out, in line 4, the word "one" and inserting in place thereof the following word:- 1B.

SECTION 3. The first paragraph of section 4 of said chapter 569 is hereby amended by striking out the fourth and fifth sentences and inserting in place thereof the following four sentences:- Except as otherwise specifically provided by this act, expenditure from the account authorized by this section shall be made by the chief executive officer of the Hale hospital, subject to appropriation in accordance with chapter 44 of the General Laws, and shall be used for the operation, maintenance, service development, capital equipment and plant for said hospital and for such other purposes as are consistent with the provisions of this act. Said account authorized by this section shall be deemed to be a trust fund. It shall be maintained and invested on behalf of said hospital by the treasurer of the city of Haverhill, and any income accruing thereon shall inure to the benefit of the hospital; provided, however, that such funds shall be invested in any investment as may be lawful for fiduciaries in the commonwealth. Notwithstanding any general or special laws to the contrary and notwithstanding the fact that expenditures from said account are subject to appropriation in accordance with this section, the chief executive officer, with the approval of the board, may transfer funds among the hospital's items of appropriation without the specific approval of the city council and may create job classifications for the hospital's personnel and establish pay scales for the positions so created; if in the aggregate, the hospital does not expend in any fiscal year an amount in excess of the amount total appropriated from the enterprise account for that year, except as may be otherwise provided by this act.

SECTION 4. Section 4B of said chapter 569, inserted by section 1A of chapter 58 of the acts of 1990, is hereby amended by striking out the sixth paragraph.

SECTION 5. Said chapter 569 is hereby further amended by inserting after section 6 the following eight sections:-

Section 6A. Subject to appropriation as required by section 4, the chief executive officer, with the approval of the board, may enter into agreements on behalf of the city and of the hospital with any medical practice to provide professional services in the hospital's service area; to facilitate the development of the hospital's medical staff; to provide management services, by itself or in conjunction with a joint venturer in accordance with the provisions of section 9 to a medical practice; to pay expenses associated with physicians relocating to the hospital's service area; to make loans, as permitted by law, to support minimum salary or the purchase of equipment for physicians relocating to the hospital's service area, provided that each physician receiving such support agrees to serve on the hospital's active medical staff for the period during which any such loan has outstanding principal or interest, that a reasonable rate of interest be charged and that such loan be on such additional reasonable terms and conditions as the board determines; and to provide such additional service supports as are determined to be reasonable by the chief executive officer and the board.

Section 6B. Subject to appropriation as required by section 4, the hospital, by vote of a majority of the full membership of the board, may make investment, hold stock in or otherwise participate in the governance of a physician/hospital organization, independent practice association, medical service corporation or joint venture with physicians and other hospitals, regardless of the form it takes, for the purpose of developing the medical staff of the hospital and for contracting with health care purchasers to provide hospital or medical services under the terms of any health insurance plan or benefit, including for purposes of entering into contracts under the terms of which the hospital will take risk for the services provided by such arrangement. By vote of a majority of the full membership of the board in each instance the hospital may delegate to any such entity the right to negotiate and execute contracts with health care purchasers on its behalf including risk contracts and to agree to be bound by the terms of any contract so negotiated and entered into on its behalf including terms relating to the allocation of risk to the hospital through the hospital's participation in risk pools or other risk arrangements. The hospital may appoint one or more members of the board or one or more hospital or city employees to serve as members of the governing body and of committees, and as officers of any such organization, if their participation in any such capacity is approved by the board. Such board members and employees shall not by so serving violate section 17 or section 19 of chapter 268A of the General Laws, and section 20 of said chapter 268A shall not apply with respect to any interest such board member or employee may have with regard to any contract between the city and any such organization entered into within the scope of this section where such interest arises because of an appointment made pursuant to this section.

Section 6C. The hospital is hereby authorized to enter into joint venture arrangements with any individual, private, nonprofit, for-profit or public entity or agency to provide health care services within its service area or to engage in any activity or undertaking necessary or incidental thereto. Any such arrangement must be approved by a majority of the full membership of the board, and the chief executive officer may, pursuant to any such vote, expend funds from the hospital's enterprise account, subject to appropriation as provided in section 4, for purposes of engaging in such joint venture arrangement; provided, however, that in using its funds for such purpose the hospital shall act in a manner consistent with the regulations of the Internal Revenue Service applicable to organizations that are exempt from federal income tax under section 501(c) of the Internal Revenue Code of 1986, or a successor thereto, when such organization is engaged in a joint venture with an entity that is not so exempt. The hospital may appoint one or more members of the board or one or more hospital or city employees to serve as members of the governing body and of committees, and as officers of any such joint venture arrangement organization, if their participation in any such capacity is approved by the board. Such board members and employees shall not by so serving violate section 17 or section 19 of chapter 268A of the General Laws, and section 20 of said chapter 268A shall not apply with respect to any interest such board member or employee may have with regard to any contract between the city and any such organization entered into within the scope of this section where such interest arises because of an appointment made pursuant to this section.

Section 6D. Notwithstanding any general or special laws to the contrary or the provisions of any ordinance of the city, the mayor may appoint persons who are not residents of the city to the board, but at no time shall persons who are nonresidents of the city constitute more than one-third of the full membership of the board. In appointing persons to the board who are not residents of the city, the mayor shall consider the desire to have representation on the board from cities and towns within the hospital's service area, other than the city, and from any system or systems with which the hospital is affiliated, as provided in section 6F.

Section 6E. Notwithstanding any general or special law to the contrary, the hospital may develop health care services in locations anywhere within its service area, including outside of the city, and may expend funds from the hospital's enterprise account for this purpose, including, as deemed appropriate by the board and as authorized by an appropriation approved pursuant to section 4 acquiring or leasing real estate for such purposes, if the development of such services does not jeopardize the hospital's principal mission of promoting health care services for the residents of the city.

Section 6F. (a) By vote of a majority of the full membership of the board and the approval of the city council, the hospital may enter into affiliation arrangements with one or more health care systems, each of which includes one or more other hospitals that are formed for purposes that include, but are not limited to, coordinating more effective provision of health care services and undertaking more effective contracting with managed care plans. For purposes of this section, "affiliation arrangements" shall mean the creation of a relationship whereby the hospital participates as a component of the broader health care system including, subject to other provisions of this section, participation in the governance of such system, in managed care risk and other third party payor contracts negotiated on behalf of such system, and in joint strategic, business and financial planning within such system. Subject to appropriation pursuant to section 4, the hospital may expend amounts in its enterprise account in furtherance of the common purposes of a system with which it affiliates.

(b) In conjunction with any system with which the hospital enters into an affiliation arrangement in accordance with this section, by vote of a majority of the full membership of the board in each instance, the hospital may delegate to an entity within such system the right to negotiate and execute contracts with health care purchasers on its behalf, including risk contracts, and to agree to be bound by the terms of any contract so negotiated and entered into on behalf of the system, including terms relating to the allocation of risk to the hospital through the hospital's participation in risk pools or other risk arrangements.

(c) In conjunction with any system with which the hospital enters into an affiliation arrangement in accordance with this section, the hospital may serve as a member of any nonprofit organization that is a part of such system or as a shareholder or member of any for-profit entity or limited liability company that is part of such system. The hospital may appoint one or more members of the board or one or more hospital or city employees to serve as members of the governing body and of committees, and as officers of any constituent entity or entities included within any such system, if the participation of any such person in any such capacity is approved by the board and by the mayor. Such board members and employees shall not by so serving violate section 17 or section 19 of chapter 268A of the General Laws, and section 20 of said chapter 268A shall not apply with respect to any interest such board member or employee may have with regard to any contract between the city and any such organization entered into within the scope of this section where such interest arises because of an appointment made pursuant to this section.

(d) This section shall be deemed to provide a complete, additional and alternative method for the effectuation of the purposes of this section and shall be construed to be supplemental to, and not in derogation of, powers otherwise conferred by law; but insofar as this section is inconsistent with any general or special law, administrative order or regulation or any limitation imposed by the municipal charter of the city, this section shall be controlling. This section shall be interpreted liberally to effectuate its purposes.

Section 6G. (a) For purposes of this section, "authorized officers" shall mean the mayor, the city auditor and the chairman of the hospital board, acting unanimously; but each of said individuals may designate any other officer of the city, or, in the case of the chairman of the board, the chief executive officer, to act on his behalf as an authorized officer for any and all purposes under this section. For purposes of this definition, "officer of the city" shall mean a person who is in charge of a department of the city or who is a member of an administrative board of the city. The mayor, city auditor and chairman of the hospital board shall not all designate the same person to serve as an authorized officer, nor shall any two of them designate the same person so to serve.

(b) The city may provide for the issuance from time to time of debt obligations on behalf of the hospital for any of its purposes. Any borrowing by the city on behalf of the hospital under the provisions of this section shall be subject to authorization by a two-thirds vote of the city council, with the approval of the mayor. All such debt obligations shall be negotiable for all purposes without regard to any other law subject only to the provisions of any such debt obligations for registration.

(c) Debt obligations issued under this section may be secured by a pledge, mortgage of or security interest in any and all assets of the hospital, whether real or personal, tangible or intangible, whether then existing or thereafter arising, including but not limited to revenues, receipts, cash, accounts, goods, equipment, inventory, general intangibles, securities or other assets or funds of the hospital, by mortgages or other instruments covering all or any part of the foregoing, including any additions, improvements, extensions to or enlargements of any real property thereafter made, or by any one or more of the foregoing, all as may be determined by the authorized officers. Debt obligations may be dated, may bear interest at such rate or rates, including rates variable from time to time, may be payable in any domestic or foreign currency and at any domestic or foreign location and may mature or otherwise be payable at such time or times as may be provided for by the authorized officers, and may be made redeemable or determinable prior to maturity at the option of the hospital or the holder thereof at such price or prices and under such terms and conditions as may be fixed by the authorized officers.

(d) The authorized officers shall determine the form of debt obligations and the manner of execution, denomination or denominations and place or places of payment thereof. In case any officer whose signature or a facsimile of whose signature shall appear on any debt obligations shall cease to be such officer before the delivery thereof, such signature or such facsimile shall nevertheless be valid and sufficient for all purposes as if such officer had remained in office until after such delivery. The authorized officers may provide for the authentication of debt obligations by a trustee, fiscal agent, registrar or transfer agent.

(e) In the discretion of the authorized officers, debt obligations of the city issued under this section may be issued with such terms as will cause the interest thereon to be subject to federal income taxation. The city may sell the hospital's debt obligations in such manner, either at public or private sale, for such price, at such rate or rates of interest, or at discount in lieu of interest, as the authorized officers determine will best effectuate its corporate purposes.

(f) In the discretion of the city council, any debt obligations issued hereunder may be secured by a resolution of the city council or by a trust agreement between the city, on behalf of the hospital, and the Massachusetts Health and Educational Facilities authority established by chapter 614 of the acts of 1968 and, for this purpose, the hospital shall be deemed to be a hospital within the meaning of section 3 of said chapter 614, or a corporate trustee, which corporate trustee may be any trust company or bank having the powers of a trust company within or without the commonwealth, and any such trust agreement shall be in such form and executed in such manner as may be determined by the authorized officers. Such trust agreement or resolution may pledge or assign, in whole or in part, any revenues, receipts, cash, accounts, inventory, general intangibles, or other assets and funds, held or to be received by the hospital, and its real property, including any additions, improvements, extensions to or enlargements of any real property thereafter made, and any contract or other rights to receive the same, whether then existing or thereafter coming into existence and whether then held or thereafter acquired by the hospital, and the proceeds thereof. Such trust agreement or resolution may contain such provisions for protecting and enforcing the rights, security and remedies of holders of debt obligations as may be reasonable or advisable, including, without limiting the generality of the foregoing, provisions defining defaults and providing for remedies in the event thereof, which may include the acceleration of maturities, restrictions on individual right of action by holders of debt obligations and covenants setting forth duties of and limitations on the hospital in relation to the conduct of its programs and the management of its property, the custody, safeguarding, investment and application of moneys, the issuance of additional or refunding debt obligations, the establishment of reserves and the making and amending of contracts.

(g) In addition to other security provided in this act or otherwise by law, debt obligations issued by the city under this section may be secured, in whole or in part, by financial guaranties, by insurance or by letters of credit issued to the city or the hospital, or a trustee, or any other person by any bank, trust company, insurance or surety company or other financial institution, within or without the commonwealth, and the city may pledge or assign any and all assets of the hospital, whether then existing or thereafter arising, including but not limited to revenues, receipts, cash, accounts, goods, equipment, inventory, general intangibles, securities, or other assets and funds of the hospital, including any additions, improvements, extensions to or enlargements of any real property thereafter made, as security for such guaranties or insurance or for the reimbursement by the city to the issuer of any such letter of credit of any payments made under such letter of credit.

(h) It shall be lawful for any bank or trust company to act as a depository or trustee of the proceeds of debt obligations, revenues or other moneys under any trust agreement or resolution provided for herein and to furnish such indemnification or to pledge such securities and issue such letters of credit as may be required by the city. Any such trust agreement or resolution may set forth the rights and remedies of holders of debt obligations and of the trustee and may restrict the individual right of action by holders of debt obligations. Any pledge of hospital revenues or other property made by the city under the provisions of this section, including, without limitation, any pledge by the city of its rights to receive payments of any kind from or for the account of mortgagors under mortgages, participations therein or subsidy, guaranty, insurance or other contracts relating thereto, and of its revenues and other property, and of the mortgages, notes, such participations, such subsidy, guaranty, insurance or other contracts or other collateral, and of the proceeds of any or all thereof shall be valid and binding and shall be deemed continuously perfected for the purposes of chapter 106 of the General Laws and other laws from the time when such pledge is made. The revenues, moneys, property, rights and proceeds so pledged and then held or thereafter acquired or received by the city or the hospital shall immediately be subject to the lien of such pledge without any physical delivery or segregation thereof or further act, and the lien of any such pledge shall be valid and binding against all parties having claims of any kind in tort, contract or otherwise against the city or the hospital, regardless of whether such parties have notice thereof. Neither the resolution, any trust agreement nor any other agreement by which a pledge is created need be filed or recorded except in the records of the city, and no filing need be made under said chapter 106 or any other law.

(i) Any holder of a debt obligation issued by the city under the provisions of this section and any trustee under a trust agreement or resolution securing the same, except to the extent the rights herein given may be restricted by such trust agreement or resolution, may bring suit upon the debt obligations and may, either at law or in equity, by suit, action, mandamus or other proceeding for legal or equitable relief, including proceedings for the appointment of a receiver to take possession and control of the business and properties of the hospital, to operate and maintain the same, to make any necessary repair, renewals and replacements in respect thereof and to fix, revise and collect fees and charges, protect and enforce any and all rights under the laws of the commonwealth or granted hereunder or under such trust agreement, resolution or other agreement and may enforce and compel the performance of all duties required by this section or by such trust agreement or resolution to be performed by the city, the hospital or by any officer thereof.

(j) Debt obligations issued by the city under this section are hereby made securities in which all public officers and public bodies of the commonwealth and its political subdivisions, all insurance companies, trust companies in their commercial departments, savings banks, cooperative banks, banking associations, investment companies, executors, administrators, trustees and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them. Such debt obligations are hereby made securities which may properly and legally be deposited with and received by any commonwealth or municipal officer or any agency or political subdivision of the commonwealth for any purpose for which the deposit of bonds or obligations of the commonwealth is now or may hereafter be authorized by law.

(k) Debt obligations issued by the city under the provisions of this section shall not be deemed to be a debt or a pledge of the faith and credit of the city but shall be payable solely from the funds of the hospital from which they are made payable pursuant to the provisions of this section. All debt obligations issued by the city under the provisions of this section, their transfer and the income therefrom, including any profit made on the sale thereof shall at all times be free from taxation of every kind by the commonwealth and by the cities, towns and other political subdivisions in the commonwealth.

(l) Notwithstanding anything in this section to the contrary, the hospital shall be liable to the city in each year for an amount equal to the amount of principal and interest payments coming due in such year on outstanding bonds of the city issued for the purposes of the hospital, and the rights of the holders of any debt obligations issued under this section shall be subordinated to the right of the city to receive such amount.

Section 6H. In order to promote the hospital's ability to compete more effectively in the health care marketplace, and in furtherance of the other purposes of this act, notwithstanding sections 23A to 23C, inclusive, of chapter 39 of the General Laws applicable to meetings of the board of any of its committees, and section 10 of chapter 66 of the General Laws relating to the availability of public records as defined in clause Twenty-sixth of section 7 of chapter 4 of the General Laws, all writings and other records concerning the following shall not be deemed to be public records for the purposes of said section 6D, and executive sessions may be held concerning the following: rates and charges; contracts and other arrangements with health care purchasers or with health care systems, or a constituent or affiliate thereof, with which the hospital is affiliated or is proposing to affiliate, including contracts relating to clinical service arrangements; medical records; and marketing strategies, strategic plans or other plans, analyses, evaluations, data or programs, if disclosure is deemed by the board to be likely to give an unfair competitive or bargaining advantage to any person or entity. This section shall not be construed to modify the provisions of the statutes cited in this paragraph as they otherwise apply to records, meetings and deliberations of the city council affecting the hospital, except that meetings and deliberations of the city council relating to its taking actions with respect to the hospital entering into affiliation arrangements, as provided in subsection (a) of section 6F may be in executive session, and all writings and other records provided to the hospital or to the city council by a health care system with which affiliation is under consideration by the hospital and the city council shall not be deemed to be public records for purposes of said section 10. Notwithstanding the foregoing, the seventh paragraph of section 23B of chapter 39 of the General Laws, relating to the records of and votes taken in executive sessions, shall apply to the records of and votes taken in executive sessions held by the board or any of its committees, or of the city council, with regard to any of the subject matters identified in this section for which executive sessions may be held. This section shall not be deemed to prevent access by an agency of the commonwealth to records of the hospital to which it would otherwise be entitled under other provisions of general or special law.

SECTION 6. Chapter 604 of the acts of 1987 is hereby repealed.

SECTION 7. Chapter 101 of the acts of 1993 is hereby repealed.

SECTION 8. This act shall take effect upon its passage.

Approved August 10, 2000.