Update: Senate defeats effort to restore Vidant funding in its budget
By Ginger Livingston
The Daily Reflector
Thursday, May 30, 2019
An amendment to remove a portion of the Senate budget that cuts Medicaid funding to Vidant Medical Center failed because of political maneuvering on the Senate floor.
Sen. Ralph Hise, a Republican representative of six western North Carolina counties, introduce a substitute amendment to give an additional $1 million to the North Carolina Eastern Area Health Education Center. He did not state what the money would fund.
He introduced it as a substitute to an amendment Pitt County Sen. Don Davis sought seeking to remove language that would no longer give Vidant Medical Center a higher Medicaid reimbursement rate because it serves as the teaching hospital for East Carolina University’s Brody School of Medicine. The change would cut somewhere between $35 million or $38 million from Vidant’s operating budget.
Republican Sen. Rick Horner urged the chamber to vote against Hise’s amendment, saying Davis had gone against his party’s leadership to vote with Republicans
Instead, the Senate voted 27-21 in favor of Hise’s amendment, defeating Davis’s amendment.
This story will be updated.
Officials are urging eastern North Carolinians to lobby against a Senate budget plan that reduces Medicaid funding to Vidant Medical Center because of a dispute with the UNC System over appointments to the hospital’s board of trustees.
Vidant Health CEO Michael Waldrum was joined by the leadership of the Vidant Health Board of Directors and a member of the the medical center Board of Trustees on Wednesday to discuss the provision. It says the Greenville hospital may no longer receive a higher rate of reimbursement it was entitled to as the teaching hospital affiliated with the Brody School of Medicine.
Instead, Vidant will receive the same reimbursement as private hospitals, a change that will cut $35 million from the hospital’s operating budget.
The cut will affect the hospital’s care of patients and investment in community health, said Shirley Carraway, vice chairwoman of Vidant Health Board of Directors and past chairwoman of Vidant Medical Center’s Board of Trustees. Vidant Health is the organization that overseas the medical center, seven other hospitals, Vidant Medical Group and home health, hospice and wellness centers.
“It will affect our mutually beneficial and longstanding relationship with the Brody School of Medicine and East Carolina University,” Carraway said. However, she said, Vidant “will continue our commitment as the partner of the Brody School of Medicine and we will continue to support an education environment for medical student residents and fellows to include our great Pirate nurses.
“This is our home and we are committed to always standing up for what is right and necessary to improve the health and well-being of the people in eastern North Carolina,” she said.
The Senate is scheduled to take the first of several votes needed to pass its budget beginning today. A final budget must be negotiated with leadership of the state House, which approved a different budget plan earlier.
“We are calling on our friends, neighbors, community leaders and elected officials to help in the fight for eastern North Carolina,” Carraway said.
The proposed Medicaid cut is the latest salvo is a battle over the appointment of nine members to the hospital’s Board of Trustees.
Since the mid 1970s, when Vidant — then Pitt County Memorial Hospital — became the teaching hospital for the Brody School of Medicine, the UNC Board of Governors has nominated nine people to serve on the trustees board. The Pitt County Board of Commissioners nominates 11 members to the board because the hospital was once owned by the county.
Last month, following unanimous votes by the county commissioners and the boards of Vidant Health and the medical center, the hospital’s articles of incorporation were amended to strip the Board of Governors of its appointment ability. The new rules give the hospital trustees the power to appoint nine members from a slate of candidates recommended by the Vidant Health Board of Directors.
A self-perpetuating membership process will ensure the trustees board is made up of members who understand the hospital and eastern North Carolina, Waldrum said.
Two members of the current Board of Trustees, Carlester T. Crumpler and Robert J. Greczyn Jr., live in Atlanta and Raleigh, respectively, but have close ties to eastern North Carolina and ECU, said J. Bryant Kittrell, chairman of Vidant Health Board of Directors. He worries future appointees of the UNC Board of Governors will not have those eastern North Carolina ties because of changes among the governors.
On May 20, UNC, along with ECU, filed a lawsuit against Vidant and Pitt County seeking to reverse the change. A temporary restraining order preventing the hospital from appointing new members was issued May 24.
The proposed Senate budget was unveiled Tuesday, the same day Vidant, the county, UNC and ECU agreed to enter mediation to resolve the dispute.
“We think they have some valid concerns but we want to make sure our concerns are heard and we are committed to working with them through the process,” Waldrum said. “That’s why the thing we don’t understand is these cuts were put in the budget at the same time the two legal teams were working to resolve the issues.”
Waldrum said he and the hospital’s leadership were surprised by the budget cuts. When asked what response they anticipated, he said, “As I mentioned, our board thought it was the right thing to do and we worked collaboratively with the Pitt County commissioners. Importantly, both of those groups unanimously approved these changes including 100 percent of the UNC Board of Governor appointees.
“We had hoped that we made appropriate and best-governance changes (and) they would work with us,” Waldrum said. “We did not anticipate people would take actions that would damage eastern North Carolina. We were surprised by that.”
The proposed $35 million cut would come on top of an anticipated $38 million loss of revenue connected to changes in the State Health Plan which will take effect on Jan. 1. When combined, Vidant is facing a $73 million loss, which equates to about 3 percent of the hospital’s annual operating budget.
“It will have a significant effect and we will have to accommodate by assessing the services we provide and changing significantly what we do to accommodate a total of over ($73) million dollars in cuts,” Waldrum said.
The significant changes include providing services to people in eastern North Carolina, offering high quality, accessible care, recruiting and retaining talent and training and supporting medical students, residents and fellows.
“I think it’s important to understand that in this coming year North Carolina is going through some of the most significant changes it’s ever had in health care,” Waldrum said. “The management team will come together to look at how we can do the best we can for our communities despite these realities.”
Contact Ginger Livingston at firstname.lastname@example.org or 252-329-9570.