Wrangell Sentinel -

Former Wrangell Medical Center CEO Noel Rea has accepted a position as the head of Sitka’s SouthEast Alaska Regional Health Consortium hospital.

In a newsletter to SEARHC members and employees, Charles Clement, the organization’s CEO, said Rea was taking over as the interim administrator of SEARHC Mt. Edgecumbe’s operation.

“It is with a heavy heart that I announce the resignation of our friend and colleague, Dr. Marty Grasmeder, Hospital Administrator/Medical Director of the SEARHC Mt. Edgecumbe Hospital. His last day will be at the end of September in order to see through the completion of the Joint Commission Survey,” Clement wrote. “In the interim, Mr. Noel Rea will be filling in as the Hospital Administrator while SEARHC starts looking, first internally, then if needed, nationally to fill the position.”

Grasmeder served with SEARHC for 19 years. He accepted a position in Portland, Ore., as the Medical Director of the Multnomah County Health Department.

According to a representative from SEARHC who spoke on condition of anonymity, Rea has been working with the organization since after his departure from WMC in a consultant capacity. Rea is registered with the State of Alaska as having a consulting firm named “Innovative Solutions of Alaska.” The address registered to Rea’s business is the same as former WMC physical therapist Korre Pieper in Anchorage. Additionally, Rea’s wife, Mari Selle-Rea, is listed as an officer in Pieper’s company, “Seawolf Physical Therapy.”

The Wrangell Sentinel requested a copy of Rea’s contract with SEARHC, but that request was denied. However, corporate communications director Michael Jenkins said that Rea’s terms of employment involved an “hourly rate,” and would be for a term of “no more than six months.”

The former WMC Board of Directors terminated Rea on June 20, 2012, during their last meeting as a quorum – after having eight board members recalled in special election the day before.

The termination triggered a severance payment to Rea, as spelled out in his employment contract, for his salary of $185,169.27 owed during the first 12 months of his five-year contract, less any amounts already received. However, because Rea was terminated in the first year of the contract, he was supposed be paid his full salary for a four-and-a-half year period.

A lawsuit was subsequently filed by the City and Borough of Wrangell in First District Court in July 2012 seeking to have an amendment to the employment contract voided, and to order that Rea return a six-figure severance check paid to him after his termination by the board for what the city called “illegal acts” by the group.

The city then asked for a laptop and iPad in Rea’s possession to be returned.

Both issues were resolved on April 29 when Superior Court Judge William B. Carey dismissed the lawsuit against Rea and six former members of the WMC Board of Directors that were recalled, along with a counterclaim brought by the defendants.

Judge Carey’s order called for Rea to return the iPad, which was in his possession as of the date the agreement was signed, a return of $250,000 to the city, and the signing of another agreement to “not make any disparaging statements, whether oral or written to any persons of or about any other party, relating to any events that were at issue” during the case.

Both the laptop and iPad were turned over to a forensic examiner as ordered by Carey.

The $250,000 payment came from the insurance company that indemnifies WMC and its officers, the Chubb Group Insurance.