Blue Mountain Hospital District is parting ways with its longtime management company.

Derek Daly, the hospital’s CEO and an employee of the management company, Health TechS3 Management Services, told the Eagle Thursday that the hospital board opted not to renew the company’s contract at its Nov. 19 meeting.

The contract with Health TechS3 — which provides various services ranging from financial audits to a group purchasing organization to reduce costs for supplies — officially expires March 31, Daly said.

Daly said the board appointed a task force made up of four hospital board members to make recommendations on the transition. He said Amy Kreger, the board’s chairperson, is heading up the task force.

“(The board) authorized the task force to work through the next steps,” he said. “And we are progressing with those next steps.”

In a Thursday phone call, Kreger declined to comment on the specifics of the board’s decision, the task force and what the hospital’s management will look like as of April 1. She said she would discuss the specifics in late March or the first week of April.

According to the Nov. 19 meeting minutes, the board was nearly unanimous in deciding to sever ties with Health TechS3, with six in favor and one opposed. There was only one dissenting vote to appoint Karla Averett, Levi Manitsas and Dotty Parsons to the task force, who will work with Portland-based law firm Miller Nash Graham & Dunn LLP to begin the transition process.

Mike Lieb, regional vice president of Health TechS3, said in a Nov. 19 report that he was disappointed with the decision to end the contract, but Health TechS3 would be “graceful” through the remainder of the contract and is available for the hospital, if needed.

Averett said the company’s years of service had not gone “unnoticed or unappreciated” and said she hoped the hospital and Health TechS3 would have a relationship in the future.

According to the Dec. 10 meeting minutes, the board unanimously authorized the task force to “engage in negotiations to employ executive leadership” and to negotiate any continuing “ancillary services” from Health TechS3 or an extension of the management services contract.

Mary Ellen Brooks, a former hospital board member who voiced concerns about quality of care, access and customer service at the hospital, said Saturday she supported the board’s decision to part ways with Health TechS3.

“I am happy with their decision,” she said.” They’ve got their work cut out for them, but they’re up for the job.”

Brooks said the changes would not happen overnight.

In a hospital work session in October, Brooks said she was a board member when the hospital district originally hired the management firm Brim and Associates 30 years ago and that the hospital “got a lot of good out of Brim.”

Brim merged with Province Healthcare in 1995 and moved its headquarters to Tennessee. Since then, the company has gone through three other mergers and a rebranding to HealthTechS3 in 2015.

According to the district’s annual expense trend, from July 2019 to June 2020, the district paid Health TechS3 $961,717.

Daly said in the work session that independent hospitals are still in many circumstances contracting for other services. He said one example is Harney County Hospital, which is very similar to Blue Mountain Hospital and closely connected to St. Charles Health System because of its electronic medical records program.