A new proposal at the New Hampshire State House could temporarily freeze executive pay at certain hospitals following layoffs or outsourcing decisions, a move tied to ongoing controversy involving the North Country Healthcare system in Coös County.
Senate Bill 664, scheduled for a Senate vote this week, would impose an 18-month freeze on CEO compensation at hospitals located in what the state defines as a “distressed place-based economy.” The rule would apply if a hospital eliminates more than 10 positions within a single department during a six-month period.
Coös County is currently the only region in New Hampshire carrying that designation. North Country Healthcare operates the county’s three hospitals — located in Berlin, Lancaster, and Colebrook — making the system the primary focus of the proposed legislation.
The bill is sponsored by Republican Sen. David Rochefort, who said the proposal reflects concerns about how public health dollars are used.
During a legislative hearing, Rochefort acknowledged the idea may be politically unusual for a Republican lawmaker but argued it addresses accountability when hospitals rely heavily on government funding.
He pointed out that more than half of North Country Healthcare’s revenue comes from Medicare and Medicaid reimbursements, according to previous statements from the hospital system.
“We fight for those dollars every day,” Rochefort said, referring to federal health funding programs. “They are difficult to allocate and increasingly limited.”
The proposal arrives during a period of scrutiny for North Country Healthcare. In recent months, a community group known as the Concerned Patients Group has organized public meetings to raise concerns about the quality of care at Weeks Medical Center in Lancaster.
Those complaints prompted attention from the New Hampshire Department of Justice’s Charitable Trusts Unit, which has opened a formal review related to the hospital system.
Among the issues raised by critics is the hospital’s decision to outsource its revenue department, which handles insurance billing. According to tax filings, North Country Healthcare CEO Thomas Mee earned more than $700,000 in the fiscal year ending in 2024.
Mee has said the outsourcing decision was not primarily a cost-cutting measure but rather a response to persistent hiring challenges in rural Coös County. He stated that only one employee was formally terminated and that others were offered positions in different departments, though several employees chose to leave after learning the department would be eliminated.
Hospital leaders have also argued that Mee’s compensation is consistent with industry standards.
In a statement responding to the legislation, North Country Healthcare said the proposal would impose rigid rules that could make it harder to recruit and retain experienced leadership.
“As written, the bill would replace the judgment of a nonprofit board with government mandates,” the hospital system said. The statement added that the board uses outside consultants to compare executive compensation with similar hospitals and to ensure compliance with regulatory guidelines.
Former board members and hospital leaders also voiced opposition during earlier hearings. Mark Kelly, who previously served on boards for both North Country Healthcare and Androscoggin Valley Hospital, said the bill could undermine the ability of local boards to manage complex health care systems.
Executive compensation at nonprofit hospitals is already regulated under federal tax law, he noted, and typically relies on independent market analysis.
Supporters of the bill argue the proposal is about protecting public resources in communities facing economic hardship. Critics say it could interfere with hospital management during a time when rural health systems nationwide are already under pressure.
The Senate is expected to vote on the measure Thursday, a decision that could influence how the state balances oversight of publicly funded health care with the independence of nonprofit hospital systems.
