Report: Tenn. AG delays hospital sale

By Jessica M. Karmasek | Jun 27, 2013

ERWIN, Tenn. (Legal Newsline) -- Tennessee Attorney General Bob Cooper reportedly has put Mountain States Health Alliance's pending acquisition of Unicoi County Memorial Hospital on hold, saying his office has "several concerns" about the proposed sale.

According to the Johnson City Press, UCMH's Board of Control was told Tuesday that Cooper delayed approval of the sale.

In a letter from the Attorney General's Office to attorneys for UCMH's board, the office identified three issues that prevented it from issuing a letter of no action.

According to the Press, they include: the board's failure to comply with the provisions of the state's Open Meetings Act in the selection and acceptance of MSHA's acquisition proposal; failure to get approval from the town of Erwin and Unicoi County; and assurance that $1.5 million in funds to be contributed to the city and county by MSHA be used for health care purposes only.

In March, the UCMH board voted to accept the final definitive agreement for the acquisition.

In April, a written notice of MSHA's pending acquisition was submitted to Cooper.

The attorney general is tasked with verifying that the sale price is fair and the board's selection process followed proper procedures.

MSHA President and CEO Dennis Vonderfecht told the Press Tuesday that it believes the hospital board followed the correct procedures and called Cooper's decision "disappointing."

"MSHA remains committed to meeting the needs of Unicoi County residents, however, and we are eager to work with the UCMH Board of Control to address all of the outstanding issues," he said in a statement to the newspaper.

Pending approval, UCMH will be the 14th hospital in the MSHA system.

From Legal Newsline: Reach Jessica Karmasek by email at

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