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County Commissioners Next In Line To Consider Novant Negotiation For Hospital

By Cece Nunn, posted Jul 10, 2020

The New Hanover County Board of Commissioners faces another major decision Monday about the future of county-owned New Hanover Regional Medical Center.

Commissioners will consider whether they, too, agree that it makes sense to pursue a deal with Winston-Salem-based Novant Health, which offered $2 billion to New Hanover County to acquire the hospital and make it a Southeastern North Carolina hub for the nonprofit system.

Novant also has offered $3.1 billion to fund NHRMC’s routine and strategic capital needs in the future.

The hospital Board of Trustees voted 16 to 1, with hospital trustee Rod Andrew voting against the measure, on Tuesday to proceed with a letter of intent (LOI) with Novant Health and its partnership with UNC Health and the UNC School of Medicine.

Tuesday’s vote followed the July 2 unanimous decision by the 21-member NHRMC Partnership Advisory Group to recommend a full integration partnership with Novant, one of three finalists along with Atrium Health and Duke Health in the process to pursue a buyer or partner for NHRMC.

The New Hanover County Board of Commissioners is set to consider entering into an LOI with Novant at its meeting at 4 p.m. Monday at the New Hanover County Historic Courthouse, 24 N. Third St., Wilmington. 

According to the Board of Commissioners’ agenda, further recommendations, based on discussions with county commissioners over the past several weeks, include: 

  • Creation of a community foundation estimated at least $1.25 billion in proceeds after the allocations below, to benefit in perpetuity all New Hanover County residents, and –governed by a Board of Directors – provide funding to further the mission and strategic plan of the county, with the initial endowment supporting and promoting initiatives in the following focus areas: health and social equity, primary, secondary and post-secondary public education, community development, and community safety;
  • Creation of a New Hanover County revenue stabilization fund of at least $300 million to help protect local taxpayers from unexpected expenses like emergency response needs from a disaster or pandemic and economic downturns; for the retirement of voter and non-voter approved debt; to
    establish pay-as-you-go financing for certain capital assets and projects; to minimize tax and fee increases in future years;
  • Creation of a New Hanover Regional Medical Center stabilization fund of at least $300 million with $200 million allocated to an Employee Investment and Resilience Fund (to support a beneficial transition from NHRMC’s existing pension plan to Novant Health’s retirement benefits plan and to support staff and provider resiliency and retention); and $100 million in a liability escrow (to finance any non-assumed liabilities, wind-down expenses, or tail coverage premiums); and
  • Creation of a mental health and behavioral health fund of at least $50 million to address the most pressing issues in the community, including substance use disorders.

“The core team that has worked on this process for the better part of a year will present this item in detail to include a thorough review of the proposed LOI between the county, NHRMC, and Novant Health,” according to the agenda documents.

The documents state that New Hanover County Manager Chris Coudriet recommends approving the LOI between the county, NHRMC and Novant Health “to authorize development of a definitive agreement for board consideration in September or October 2020 that is inclusive of all items addressed during the presentation. 

“The definitive agreement would be legally binding to further the goals of the healthcare system and the priorities of the community, and a final version would be shared publicly at least 10 days prior to a public hearing and vote of the Board of Commissioners on whether to execute the agreement.”

Board of Commissioners' meetings are broadcast live on NHCTV (Spectrum channel 13 and Charter channel 5) and streamed live online at NHCTV.com.

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