Potential sale of hospital becomes political hot-button in Wilmington

Eamon Queeney- The North State Journal
State Treasurer Dale Folwell speaks at a Council of State meeting in Raleigh. (File photo)

Wilmington — As election races heat up and an important March 16 deadline for proposals looms, the New Hanover Regional Medical Center — and its fate as one of the only county-owned hospitals in the nation — is driving much of the political conversation in the greater Wilmington area.

When the New Hanover County Commission voted in September 2019 for an “Intent to Sell” resolution, many in the community were immediately concerned. A group called “Save Our Hospital” was formed to oppose a sale or at least to demand a slower, more deliberate process. The county and the hospital then formed a Partnership Advisory Group in response to concerns and to better handle the process.

Spence Broadhurst, co-chair of the PAG and a former mayor of Wilmington, told NSJ that after realizing there might be long-term issues if the status quo was maintained, the hospital’s board and the county commissioners decided to explore options to put the hospital on firmer ground. While a sale was possible, he said the county wanted to request proposals from a host of health care organizations so it could see what options were available.

“Unfortunately, by general statute, in order for us to send out RFPs [Requests for Proposal], which are a big part of us understanding what our potential resources are, they had to pass a resolution, but in that resolution, I’ve been told, you have to put the term ‘Intent to Sell.’”

Broadhurst said it was not their intention to move toward a sale, but that was the message received.

“I do think that created a lot of confusion, a lot of excitement, and a lot of emotion,” he said.

North Carolina Treasurer Dale Folwell, a Republican, attended one of the “Save Our Hospital” meetings and told NSJ, “I was very encouraged by the diversity in the audience that night of people who are against it. I am encouraged about the pledge people who are running for county commissioner have signed regarding how they feel about this.”

The pledge Folwell referenced, which binds the candidate against supporting a sale, has been signed by every Democrat running for county commission in New Hanover, as well as by four of nine Republicans. Because the hospital is owned by the county, the county commission will be the ones to ultimately vote on what happens to it.

State Sen. Harper Peterson (D-New Hanover), who represents the location of the hospital, has been outspoken against the potential sale of NHRMC.

He told NSJ it is “the biggest decision at the county level for the taxpayer we’ll make in our lifetime.”

Peterson cited data showing that the hospital currently is on good financial ground.

“What is the urgency to make this decision when we’re a very healthy hospital?” Peterson asked.

Folwell agreed.

“It’s one of the rare community hospitals that is accessible, reasonably priced and profitable, and nobody has been able to articulate what problem they are trying to solve,” the state treasurer said.

The problem, said Broadhurst, is that the consultants hired, Ponder Financial, showed in their analysis that despite a currently strong position, the hospital cannot achieve its goals easily down the road.

“The data [Ponder] presented says, based on what they see are reasonable circumstances, and you apply what it is going to cost to achieve the strategic plan … it does come to the pretty clear conclusion that we do not have the financial resources to achieve that. We need to give the medical center the flexibility to manage those variables regardless of what happens.”

Folwell said national studies, specifically citing New England Journal of Medicine and Harvard University, show that sales or mergers of hospital systems lead to higher costs, worse access and lower quality. He said you don’t need the national studies though — all you have to do is look across the state at the sale of Mission Hospital in the Asheville area to private hospital system HCA.

“In the last four weeks, the complaints about what is happening to the quality and the cost of health care at Mission Hospital, that the attorney general signed off on, are exploding,” Folwell said, asserting he warned Attorney General Josh Stein that these problems were likely.

Stein, in response to headlines about possible mismanagement of Mission Hospital by HCA, released a statement saying in part that they took the health of western North Carolinians seriously “as we negotiated with HCA over its purchase of Mission. I am deeply concerned about what I’ve been hearing about HCA — and I want answers.”

In a recent visit, Democratic presidential candidate Sen. Bernie Sanders of Vermont encouraged Mission’s nurses to organize a union.

“The situation at Mission Hospital, although it has some similarities, it is an entirely different situation,” Broadhurst said. “That’s a challenging situation out there, but we can learn from it.”

Broadhurst said NHRMC doesn’t have to go down the path that Mission went, of a private health care system buying them out. The PAG will be receiving proposals from many organizations, some mentioned have included the Mayo Clinic, Duke Health, UNC Health, Johns Hopkins Medicine and Kaiser Permanente. After receiving all of these “RFPs,” the PAG will then consider them and make a recommendation to the county commission. Broadhurst said it will likely take “several more months” of meetings to arrive at a recommendation.

“We can accept a proposal. We cannot accept any of the proposals. We can take pieces of the proposals,” said Broadhurst. “We really don’t know what will be in those proposals. So, to be quite candid, it would be premature for us or Sen. Peterson or Treasurer Folwell to make a determination at this point without all the information.”

Both Folwell and Peterson agree that their issue is not only about private buyers but allowing the hospital system to change hands and be lost as an asset of the taxpayers.

“The rush just makes me uncomfortable and makes a lot of people in this community uncomfortable, especially when it’s a public hospital,” said Peterson. “This should be an election issue in November. Once it’s done, it’s done.”

“This asset is worth tens of millions of dollars, and it belongs to the people of that county and no one else,” Folwell said.

According to Broadhurst, though, change is likely necessary and now is the time to negotiate while the hospital is in a strong position.

“Some hospitals have not done that and found themselves in a compromised position where they had to merge, sell or partner, and then whoever their partner was dictated the terms,” Broadhurst said. “We’re in a strong position, so whatever we do, we can dictate the terms.”