ECU, Vidant sign agreement to unify clinical practices
The Daily Reflector
Wednesday, July 26, 2017
Vidant Health and East Carolina University on Wednesday signed an agreement to unify the 80 Vidant and ECU medical practices in eastern North Carolina, combining thousands of employees under a single new company to be named at a later date.
The agreement was signed in Greenville by members of a new governing board for the medical group currently called VECU, a combination of Vidant Medical Group, a subsidiary of Vidant Health, and ECU Physicians. The signing was the final step in a months-long process to form the new entity to consolidate the state-governed ECU doctors group and the private, not-for-profit Vidant group.
While it’s taken more than a year to get here, officials said the creation of VECU is just the starting point for the company, with myriad details to be worked out including its name and the fate of state benefits for about 800 public employees who currently work for ECU. The process is expected to take 18 months.
Leaders say the initiative will greatly improve health care services and research in eastern North Carolina and better train and provide a top quality health care workforce. It also will bolster both of those efforts in a changing and uncertain time for health care in America.
“Regardless of what happens on the national landscape, we are better positioned to care for patients, their families and the communities we serve if we do this important work together,” Vidant CEO Dr. Michael Waldrum said. “The mission of both organizations, and the mission of the newly formed integrated physician entity, is about rural health care leadership, and we believe today’s announcement is a major step forward in ensuring we provide the very best care at the most affordable price.”
The announcement comes after months of formal collaboration — and years of informal talks — between the the two largest physician groups that until now have had a strictly transactional relationship that sometimes has had them at odds, allowing them to become one strategic entity.
The terms of the agreement, negotiated with Vidant by UNC President Margaret Spellings, ECU Chancellor Cecil Staton and University of North Carolina Board of Governors Budget and Finance Committee Chairman Scott Lampe, meet the parameters set forth by the Board of Governors, Waldrum and Staton told The Daily Reflector.
“This is an agreement forged from one idea, that together we can create a better way to deliver health care to even the most rural areas of eastern North Carolina,” said Staton, who became chancellor 13 months ago and was immediately enveloped into the ongoing effort to reform a business model that officials said was struggling to face the modern challenges of health care management.
“The combination of skills from both organizations into one new entity flows naturally from a longstanding partnership. It also mirrors similar developments at other health care institutions across the country in response to significant changes in the health care landscape,” Staton said.
The VECU board, chaired by the dean of the medical school, includes six members appointed by Vidant and five by ECU. Staton, who also will sit on the Vidant Health board, will be the 12th sitting VECU board member, but in an ex-officio capacity. While financial risk and responsibility for the new entity will rest with Vidant, it is legally structured to operate in support of the mission of Brody School of Medicine. The medical school’s relationship with the UNC System and the state of North Carolina remains unchanged, the two institutions’ leaders said.
As part of the agreement, Vidant will make an initial $35 million payment to ECU and an annual $14.25 million mission support payment to Brody School of Medicine for the next 30 years, according to a published announcement. The new organization is expected to begin operations in 2018.
About 400 doctors currently employed by ECU Physicians and 400 who work for Vidant will work for the new entity. The ones who worked for ECU Physicians will continue to be employed by the Brody School of Medicine as well.
The agreement does not yet address the status of about 800 ECU support staff who currently are state employees, Waldrum and Staton said. Those negotiations and plans could not be undertaken while the two entities were separate businesses, which would have violated anti-trust laws, they said.
“Because of legal constraints, we haven’t been able to sit at the table and share key employee information during the long time it took to work out a plan for governance,” Waldrum said. “With this agreement signed, we can start sharing employee data, fill the company and begin the work.”
Company operations and policies for the support structure will be part of the next integration phase, expected to be enacted by committees in steps over the next 18 months, the Vidant CEO said.
“We still don’t have specificity on human resources matters,” Waldrum said. “We know how many employees and doctors each has, but we don’t know how much each other pays and other similar information. We will do that with the intent of being a successful company, and we need those providers, nurses, techs and staff to be successful in taking care of people. We don’t need them leaving.”
People rightly concerned about their future employment status need only consider the insatiable need for health care in the region, Waldrum and Staton said.
“The fact is that we need those people to serve that need,” Waldrum said.
“And the needs will continue to grow,” Staton added.
Both ECU and Vidant believe the new clinically-integrated entity will be better able through its combined expertise to respond to the changing health care environment currently being addressed in Congress and in Raleigh.
“You can’t predict or become paralyzed by fear. I believe to my core that by concentrating on what you do the value of (health care delivery) services will be rewarded,” Waldrum said. “That’s the path through those (uncertainties). Even in the catastrophic scenario of our legislators allowing the national health care system to collapse, we’re better prepared to deal with that locked arm in arm than separately.”
The patients served by Vidant and ECU will remain in need of health care tomorrow regardless of the outcome in Washington today, Staton said.
“The good news is that for every program we have related to health care workforce needs, they are oversubscribed,” Staton said. “We have no vacancies. We have no trouble finding North Carolinian students to train who earnestly want to do this; at the Brody School, in our nursing program and all the colleges and health sciences programs. That’s a good thing, a hopeful thing.”
Contact Michael Abramowitz at firstname.lastname@example.org or 252-329-9507.