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Heath plan opposition enlists grass-roots allies

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Dr. Michael Waldrum, CEO of Vidant Health speaks about the changes in the North Carolina State Health Plan, during a meeting at Cornerstone Baptist Church, Thursday morning. Vidant is working to build public support against proposed changes to the State Health Plan that will Vidant said will reduce revenues by $40 million annually. (Juliette Cooke/The Daily Reflector)


By Bobby Burns
The Daily Reflector

Sunday, December 16, 2018

Vidant Health is working to build grass-roots opposition to a proposal it says will cut revenues by $40 million and force it to significantly curtail services, while supporters of the proposal are standing firm.

Health system officials on Thursday met with a group of ministers from Pitt, Bertie, Edgecombe, Beaufort and other counties where Vidant operates hospitals and provides services. They asked the ministers to help them lobby state officials to negotiate a deal with administrators of the State Health Plan for Teachers and State Employees.

Proposed changes to the health plan would reduce reimbursement rates to care providers by 14 percent on average, according to State Treasurer Dale Folwell, saving $300 million for taxpayers and $65 million for plan members annually. Providers say the cuts would impede services across the state and disproportionately affect institutions like Vidant that care for large indigent populations. They say there are less disruptive ways to achieve savings.

“We think there is a better solution,” Vidant CEO Michael Waldrum told the group at Cornerstone Missionary Baptist Church as part of its #StandUpForENC effort. “We think there needs to be better oversight of this process. And we are asking our legislators to stop the train from rolling over us ... because it plays out in our community more significantly.”

Under the proposal crafted by Folwell, the state health plan starting in 2020 would pay providers a rate based on what Medicare pays. Folwell said the plan reimburses providers on average 77 percent more than Medicare and in some cases will pay providers more than they receive under the current state plan.

The restructuring is necessary because taxpayers currently must pay $3.4 billion annually to keep premiums and other costs manageable for the 727,000 people carried by the plan. Even then, Folwell’s office estimates the plan has $30 billion in unfunded liabilities.

Folwell’s proposal pays providers the same regardless of their location and the people they serve, Waldrum said. The cuts hit Vidant harder because it must charge paying customers more than other systems to make up for the greater proportion of patients it serves who have no health insurance, plus larger per capita numbers who are on Medicaid and Medicare, which have the lowest reimbursement rates.

Vidant officials estimate Folwell’s cuts will average closer to 30 percent here. They said that obstetrics and maternal services will be among the hardest hit because so many patients utilizing those services receive free or low-cost care. Expectant parents may have to drive farther to receive care if cuts force Vidant to curtail rural services, Waldrum said. 

The prospect concerned ministers gathered for Thursday’s meeting like the Rev. Richard Joyner of Conetoe, who said people in his community have come to rely on care provided through Vidant Edgecombe Hospital and other Vidant services in Tarboro.

Joyner worried that the cuts would impact grant and outreach programs like the Edgecombe County Barbershop Partnership, a collaborative effort among Vidant Edgecombe, Vidant Multispecialty Clinic and local barbers to increase prostate cancer awareness among African-American men.

He said ministers like him who work with Vidant are thankful the health system practices sustainable health care through a community based network that considers the impact of health issues in areas such as public housing and the educational system. “That’s critical to us that Vidant has taken that road to practice health care not just from an institutional level but from a community level,” he said.

“We want a plan that we’re involved in creating, not a plan that is imposed upon us that we have to respond to,” Joyner said. “We want a collaborative resolution that supports our communities in a sustainable way.”

Supporters of the health plan reforms are sympathetic to the needs of the uninsured and underinsured, said Robert Broome, executive director of the State Employees Association of North Carolina, which is working to rally state employees and others to support the changes. However, those needs should be addressed separately, he said.

“They’re fighting the right fight in the wrong place,” Broome said of Vidant. “This state needs to have a serious discussion and a debate about how we pay for uninsured care, and the State Employees Association recognizes that is a conversation worth having and we want to be there for that. But this does not need to be balanced on the backs of taxpayers and balanced on the backs of state employees, teachers and retirees.”

The state could provide insurance to more than 500,000 people by using available funds to expand Medicaid, the federal insurance program for poor people. “I think that is definitely something that merits a closer look,” Broome said Friday. “There is money that is being left on the table that could be used for proving care to the uninsured without having to overcharge everyone else that has self-funded plans.”

Political leaders in North Carolina have resisted Medicaid expansion since the passage of the Affordable Care Act made funds available in 2010, and they have showed few signs they would consider it now. Adding to uncertainty about expansion, a federal judge in Texas on Friday ruled in favor of new arguments to strike down the act as unconstitutional. The ruling is expected to makes its way to the Supreme Court.

Waldrum told the ministers on Thursday that Vidant and other providers can work with the state plan to create significant savings sooner than later. The system would like to establish a population-based approach like it does now with Medicare through Vidant’s accountable care organization — a group of providers that coordinates treatment and preventative care across populations that share common illnesses.

State lawmakers and experts concerned about the impact Folwell’s proposal will have on rural health and the the economy in communities like the ones Vidant serves have made efforts to convince Folwell to consider that approach, State Rep. Greg Murphy, R-Pitt, said on Friday. So far the attempts have been fruitless.

Murphy, a surgeon and former chief of staff at Vidant who runs a private urology practice, chairs committees in the state House that develop legislation on health issues. He said he absolutely agrees with Folwell that state health plan must be reformed but vehemently disagrees on the approach.

He is hopeful that discussions can take place during the 2019 legislative session to resolve concerns, and he said he is confident leaders can develop an approach to save the plan $300 million or more. He also said there is an appetite to block Folwell’s reforms if the treasurer won’t consider alternatives. “I hope it does not come to that,” Murphy said.

More health systems are raising concerns about the plan since Waldrum began Vidant’s campaign earlier this month. Gene Woods, chief executive of the state’s largest provider, Atrium Health, said at the system’s quarterly board meeting Dec. 11 that he is “most concerned” about the plan’s impact, according to a report by Business NC magazine.

The move could cause significant harm to North Carolina’s rural hospitals, Woods said. Charlotte-based Atrium officials are talking to state lawmakers and Gov. Roy Cooper about seeking “a much more measured approach,” the magazine reported.

Waldrum asked the ministers on Thursday to go back to their communities and enlist their congregations and neighbors in the campaign. He provided sample letters for them to help them write to their legislators and discussed more meetings like Thursday’s.

“I think this is more of a marathon than a sprint ... so starting to have a dialogue and starting to have people talk about, understand it ... and as they come into the long session then they need to hear that the people who voted them into office don’t think that this is the right thing to do.”

Contact Bobby Burns at baburns@reflector.com and 329-9572.