Gov. Larry Hogan appointed four new members to the University of Maryland Medical System board of directors and a key hospital executive announced his retirement Tuesday amid sweeping change at the hospital network following a self-dealing scandal that resulted in the resignations of Baltimore’s mayor and other top hospital officials.
The institution has been under fire since March, when The Baltimore Sun reported a third of its 30 board members or their companies had financial deals with the system, some of which were not competitively bid. They included then-Mayor Catherine Pugh, a Democrat who made hundreds of thousands of dollars selling children’s books in a sole-source arrangement with UMMS. She later resigned from the board and as mayor amid multiple ongoing investigations into the book deals and her finances.
Hogan’s appointments Tuesday mean a majority of the 26-member board is now new to the organization, which takes in more than $4 billion in revenue annually. The replacements were required under a state law passed this year that mandated reforms at the hospital network, including that all appointed board members must step down by the end of 2019, to be replaced or reappointed by the governor.
On Tuesday, a system spokesman confirmed the retirement plans of Mark Wasserman, the hospital network’s top lobbyist. Wasserman, 69, announced to colleagues in an internal message Tuesday that he plans to retire later this year after 22 years with the system.
Michael Schwartzberg, the spokesman, called the retirement “long planned” and said it comes after “about a year of discussion with UMMS leadership and coincides with his approaching 70th birthday.”
Wasserman did not respond to requests for comment.
Long a power broker in Democratic circles in Baltimore and Annapolis, dating to his days as an aide to the late Democratic Gov. William Donald Schaefer, Wasserman joined UMMS as its senior vice president of external affairs in 1997. Last year, he was paid nearly $510,000 to be the guy who could open doors and bend ears for UMMS.
During Pugh’s successful mayoral election in 2016, Wasserman appeared in a campaign ad with her.
While Hogan, a Republican, singled out Wasserman for failing to attend a closed-door meeting to answer questions in Annapolis shortly after the scandal broke, Wasserman’s name did not appear in a report on the system’s contracts with board members that was completed by the California-based firm Nygren Consulting. Former UMMS board member D. Bruce Poole told The Sun in June that “every indication is that Mark was not involved” in the self-dealing or Pugh’s deals.
Wasserman’s title was given in June to another system executive, Kristin Jones Bryce. Of his status at that time, Schwartzberg said only that Wasserman remained a “valued member of the UMMS senior leadership team” who was working “in conjunction” with Bryce.
Wasserman’s departure comes as the network is undergoing further change.
On Tuesday, Hogan appointed Thomas Scott, president of engineering and construction firm LRS Federal LLC in Millersville, to replace M&T Bank executive August Chiasera on the board. Hogan named Liz Sweeney, a municipal finance analyst who previously worked for S&P Global Ratings, to replace James Soltesz, an engineering firm executive.
Hogan also appointed Keith McMahan, a GOP donor who operates Tri Gas & Oil Co. Inc., a Federalsburg company founded by his grandparents, to replace former state Sen. Francis X. Kelly, an insurance executive considered the founding father of the hospital network. Hogan chose Robert Wallace, president and CEO of Baltimore-based BITHGROUP Technologies Inc., to replace engineering executive Robert Rauch.
Sweeney said she applied for the volunteer position because of how crucial the system is to the health care of Marylanders across the state.
“This is a really, really important institution in our state,” she said. “They are the primary provider of indigent care statewide. It’s really important to have sound and good stewardship of that mission.”
Sweeney said she hoped to bring a “strong, independent voice" to the board. She noted her background working in credit ratings requires someone who is “free of influence.”
“Every now and then, you have to poke a stick at the way you’ve been doing things,” Sweeney said. “That may mean that we decide to change some things.”
McMahan said he hoped to be a voice for the Eastern Shore on the board in Baltimore. He said UMMS’ three hospitals there need to be equipped to provide health care for about 170,000 people.
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“I’m a lifetime resident of Caroline County,” said McMahan, adding that he hoped to exchange ideas with his colleagues from central Maryland. “I look forward to sharing information that hopefully benefits both ways.”
The governor reappointed businessman Barry Gossett, who donates to politicians from both parties, and Louis Pope, former state GOP chairman, to their seats on the board.
Wallace, Gossett and Pope are also members of the University System of Maryland board of regents.
All new UMMS board members are subject to confirmation votes by the state Senate, but took office Tuesday and can serve until senators vote on their appointments after the Senate convenes in January for a new session.
Board members can serve up to two five-year terms. In the past, board members often stayed beyond the end of their terms if a governor didn’t replace them.
The medical system board has elected James “Chip” DiPaula Jr. as its new chairman and Alexander Williams Jr. as its new vice chairman. They’ll serve in those roles for the remainder of the year. Former Chairman Stephen A. Burch was among several board members who resigned amid the scandal.
In addition to mandating a gradual replacement of the current board and requiring term limits, the new law banned no-bid contracts for board members and required a state audit of the hospital system’s contracting practices. The law requires the Office of Legislative Audits to report its findings to Hogan and top lawmakers by Dec. 15.