“Why did they choose to do this here?” a member of the assembled crowd mused. We were standing on Princess Street, facing one of the entrances to the New Hanover County Courthouse. Moments earlier Gene Merritt, Alex Hall, Sen. Harper Peterson, and Bill Shell, surrounded by a group of supporters concerned about the sale of New Hanover Regional Medical Center (NHRMC), had announced the formation of Save Our Hospital, Inc., a 501(c)4 organization. Originally, they planned to make the announcement from the front steps of the historic courthouse, where NHC County Commissioners hold meetings, but the traffic noise pushed their location. And it seemed somehow more appropriate.
Behind us stood Thalian Hall, the backdrop for numerous political protests (including infamous speeches Alfred Moore Wadell made to incite the violence of 1898). One block farther west is the former home of the older courthouse, where tax master William Huston was forced to resign in 1765. A mob, enraged by The Stamp Act, brought him to the courthouse to witness his public resignation. It was one of the important moments for our colony on the road to the revolution.
Fast forward to 2019: Here we were yet again, with a group of well-meaning citizens trying to have a voice on decisions that shape our daily lives.
“We believe New Hanover Regional Medical Center, a financially viable institution, is fully capable of managing its own future without selling out or obtaining a partner,” Merritt read from a prepared statement. “We favor local control of our hospital system. And we are confident a large number of people in New Hanover County and southeastern North Carolina feel the same.”
The group cited the behavior of the commissioners as “secretive, non-communicative, and non-inclusive” as a motivator for their formation. Their words might seem strident; however, after the commissioners’ actions seen over the last year, they almost sound kind and forgiving. The idea that over a billion-plus-dollar sale of a public asset could be announced and completed in less than a year is startling. But that appears to be the intent here.
In July the public was informed the New Hanover County Commissioners were planning to adopt a resolution of intent to sell NHRMC. The publicly owned hospital serves seven counties and employs over 7,000 people; plus, it’s a teaching hospital. The ramification of its sale should be taken very seriously and should carefully be thought out before any action is taken. Yet, it looks like the sale is on track to close in less time than it takes to gestate a healthy human. Part of the motivation cited has been how NHRMC is currently prohibited from borrowing capital funding from outside our area. One of the two dissenting votes on the resolution of intent to sell, Commissioner Barfield asked publicly why pursuing an alternative to allow NHRMC to raise said capital from outside sources is being ignored in favor of selling a valuable asset.
It is an asset—a remarkable one that gives every indication it will continue to accrue in value.
Sen. Peterson raised concerns with the North Carolina Attorney General regarding the blasé attitude toward NHRMC’s nearly $1 billion in assets. There has been no clear schedule presented as to what would be included in the sale and what would be retained by the county. Considering the NHC Commission comprises two attorneys, a real-estate developer, a contractor and financial advisor, it seems odd something that would be addressed in any basic residential real-estate transaction is not even a blip on their radar. As Bill Shell asked, “What’s going to happen to that $650 million the hospital already has in its surplus?”
As local attorney Alex Hall noted, “This hospital, this year, is scheduled to make about $90 million. It’s got hundreds of millions of dollars in reserves. It makes no sense to sell at this time.”
Currently, New Hanover County has set up a Partnership Advisory Group (PAG) composed of five hospital trustees, five doctors and nine people from the community, to review the options for the future of the hospital and ultimately craft the Request for Proposals (RFP) that will be sent to five potential buyers. They will then evaluate the responses and make a recommendation to the commissioners. Merritt noted the hospital has asked the public “not to rush to judgment, and allow the PAG to do their comprehensive and due diligence—ironic, since the hospital is rushing to sell.” He pointed to five scheduled PAG meetings between October 29 and December 19 and the intent to approve the RFP on December 19. When I asked Spence Broadhurst, co-chair of the Partnership Advisory Group, what recourse they might have if commissioners ignored their recommendation, he responded it was “beyond the scope of work.” In other words, if they don’t come up with the answer the commissioners want, they will be ignored. Then the NHC Commissioners will do what they want anyway. At least they know what is expected of them. Merritt concurred.
“I firmly believe the leadership of the PAG are good people and they want to do the right thing for the people of southeastern North Carolina. I’m just concerned about the big picture.”
Hall observed how Save Our Hospital has requested documents showing contracts between the hospital and any healthcare providers that have requested information about the sale. “We have yet to get that to this day,” he said.
Hall is not currently acting as counsel for Save Our Hospital but noted he would be happy to if the group decided they need one. “This just flew all over me when I first heard it,” he said. “That they were trying to sell this hospital.” Hall shook his head.
This is personal for all of us, and he is no exception.
“My dad was on the commission when they finally got the bond issue approved to build the hospital,” Hall told, “and he’d be rolling over in his grave if he thought they were going to sell it.”
Bill Shell reminded how hospital consolidation leads to reduced services and increased costs, all of which get passed on to patients and business owners who pay more for employee insurance. “What we have here in New Hanover County right now is actually a monopoly of the hospital. The fact is what we do have is local control by political organization: the county commissioners who appoint the board of trustees. So we have control over the hospital, and we have control over its prices. If that control goes someplace else, we no longer have that.”
Merritt and Shell both said the rush to push the sale through is concerning. More so, it’s a useful tactic for controlling the flow of information both the PAG and public have access to.
“We have an opportunity here in this area to show how local hospitals can be done: run profitably, give medical care and things other places don’t have rather than be gobbled up by a larger organization that’s going to milk the profits out of the area, increase costs and reduce services,” Shell continued. “This is an opportunity to show people in this area, in this state and to people cross the nation.”
Not everyone was convinced, though.
“Hey Harper!” a man called from the audience. “What gives us the impression, since we can’t have clean water, the state or any other federal agency is going to back our play?”
“At the end of the day, North Carolina Attorney General’s office is going to review any contract,” Peterson responded. “We have faith they are looking out for the welfare of the citizens of this county. I have faith in that.”
“If that sale occurs and it occurs to some outside entity that has a monopoly here, the issue then may become legal on an anti-trust matter,” Shell said. “The attorney general is already involved in this.”
In recent weeks, Commissioners Patricia Kusek and Woody White have both announced they will not seek another term. If NHRMC does in fact have hundreds of millions of dollars in reserves, we are not at a crisis point. We do not have to sell the hospital within a matter of months in order to maintain services.
Slowing this down to allow a public referendum either directly as a ballot item or through the election of two new commissioners seems more in keeping with promise of democracy and sacred trust of the public purse. Railroading a sale of a valuable public asset without allowing the public to decide its own destiny on healthcare makes concerns of the mob who brought William Huston to the courthouse over stamps affixed to newspapers and legal documents far more palpable than ever before. Perhaps it was Hall who summed it up best: “You can milk a cow a thousand times, but you can’t butcher it but once. We don’t want our hospital butchered.”