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Partnership Advisory Group Receives Update on County Plan for Partnership Proceeds and Novant Health’s Commitments to Region

The commitments and scope of benefits to the region from a proposed partnership between New Hanover Regional Medical Center, Novant Health, UNC Health and UNC School of Medicine were reviewed during a meeting of the Partnership Advisory Group Wednesday, September 9, 2020.

The citizen-led Partnership Advisory Group was formed in October 2019 to explore and recommend options for the future of New Hanover Regional Medical Center. On July 2, the group unanimously voted to recommend New Hanover Regional Medical Center become part of not-for-profit Novant Health, a partnership that includes an expanded relationship with UNC Health for specialized pediatric care and UNC School of Medicine for significantly more medical training in the region.

The Advisory Group’s recommendation was supported by the NHRMC Board of Trustees and New Hanover County Board of Commissioners. Both boards approved signing a letter of intent outlining terms of the proposal and moving forward with negotiating a final, binding agreement.

At its meeting Wednesday, the Advisory Group reviewed and approved the key terms and conditions for the final agreement.  Those include Novant Health’s commitments to maintain or enhance:

  • Scope, level and areas of service
  • Quality and affordability of care
  • Charity care
  • Health equity
  • Staff protections and opportunities
  • Medical staff governance and agreements
  • Medical education and clinical training
  • Local board governance of NHRMC

“As the agreement and commitments are refined, we can see in greater detail how much will be done to support the advancement and growth of care in the region,” said Barb Biehner, co-chair of the Partnership Advisory Group. “It’s exciting to be getting closer to making it a reality.”

New Hanover County’s Plan for Using Proceeds to Benefit Area Residents 

Although the use of proceeds from the sale of NHRMC is outside the scope of the Partnership Advisory Group and the terms of the agreement with Novant Health, the group had an opportunity Wednesday night to learn more about how the money could be used to benefit area residents.

Novant Health’s proposal includes $1.5 billion to New Hanover County. The County would also receive an estimated $400 million from NHRMC’s reserves at the time of closing.
As the elected representatives of county citizens, New Hanover County Commissioners have the responsibility for determining how the proceeds will be used.

New Hanover County Manager Chris Coudriet reviewed the plan approved by New Hanover County Commissioners at their July 13 meeting, including Commissioner-directed changes since that vote.  The plan includes:

  • $1.25 billion for a community benefit foundation, which would be set up to allow interest from the fund to be allocated each year to programs that address the county’s needs, including education, community safety, health and social equity, and community development. Depending on the investment structure, there could be upwards of $50 million available for area agencies and programs that meet these focus areas each year. The foundation would have an 11-member Board of Directors (5 appointed by County Commissioners and 6 appointed by local Hospital Board, and would not be self-perpetuating), and there would be a 2-year cooling off period for any Board of Trustees member or elected official to be able to serve on the foundation board.
  • $300 million for a county revenue stabilization fund, which would help retire county debt and protect New Hanover County taxpayers from unexpected budget shortfalls resulting from emergencies and economic downturns.
  • $50 million for mental and behavioral health services, which would help tackle some of our area’s greatest challenges with substance treatment programs and expanded access to mental health services.
  • $300 million for NHRMC transition, which includes up to $100 million to cover the business and legal expenses that come with transitioning ownership and $200 million to support NHRMC employees and providers as they make the transition.

“This is a once in a generation opportunity to raise the level of what this community can do for its residents well into the future,” said Spence Broadhurst, co-chair of the Partnership Advisory Group. “Our commissioners should be commended for their thoughtful approach to ensuring the funds are structured to do the most good.”

Next Steps

Before the benefits of the partnership can be realized, the final agreement needs to be completed and approved.

“We are close to finalizing the details of the agreement,” said John Gizdic, NHRMC President and CEO. “Novant Health has been very thorough in how they have approached this process from the beginning and consistent in their commitments. It has been a collaborative effort that reflects well on the culture of the organization and how we can expect to move forward.”

When the agreement is finalized, it will come back to the Partnership Advisory Group for approval and be posted for the public to review on www.nhrmcfuture.org.  A public hearing will be held before it goes to the NHRMC Board of Trustees and New Hanover County Board of Commissioners for discussion and a final vote.

New Hanover County and New Hanover Regional Medical Center will share information on timing as dates are finalized.  Sign up for email updates on https://nhrmcfuture.org/stay-informed/.