Health Care

Transcript Of NHRMC, County Briefing

By Staff Reports, posted Jul 24, 2019
The following is a session recorded and transcribed by the Business Journal of the media briefing New Hanover County Manager Chris Coudriet and NHRMC President and CEO John Gizdic held Tuesday discussing the proposal to explore a potential sale of the hospital.
They covered the reasons behind the issue coming up now, the process for approvals and soliciting offers, potential uses of sale proceeds and other areas. Representatives from several media outlets, including the Greater Wilmington Business Journal, asked Coudriet and Gizdic questions, whose answers are outlined below.

(For reaction from other local health care industry officials and elected leaders, click here.)

Chris Coudriet, New Hanover County manager: 
"New Hanover Regional Medical Center is a county-owned health system founded in 1967. The Board of County Commissioners provides ultimate oversight for the hospital by appointing the Board of Trustees to ensure the hospital's mission is effectively carried out.
New Hanover Regional Medical Center is the largest county-owned health system in the state of North Carolina and the third-largest county health system in the United States. As a county-owned health system, we enjoy the benefit that our hospital is entirely self-sustaining and currently receives no county tax dollars for its operations.
This fact is actually unusual for most county and health systems across the country. New Hanover Regional Medical Center is the largest county-owned hospital in the United States that does not receive any county tax dollars to help it operate. County leaders and hospital leaders are united in the belief that every resident of our community deserves the highest quality of care, deserves access to a comprehensive array of services provided with the latest health care technology, and that every person receives the support they need to stay healthy.
If the resolution passes with a majority vote September the 3rd, the county and the hospital will begin the process of developing a request for proposals and then accepting proposals from health systems interested in partnering with New Hanover Regional Medical Center. If the county proceeds, any potential partners will be evaluated at a minimum by their ability to invest in and accelerate the outstanding work  being done by New Hanover Regional Medical Center and its team and the great work being done by our health care providers and community agencies to improve health care and wellness throughout the entire region.
I'd like to ask John [Gizdic] to advance this discussion by giving some specific information about health care priorities in the future and why we're having this discussion now."

John Gizdic, NHRMC president and CEO
"Thank you, Chris. And thank you all for being here today for this exciting announcement.
As Chris mentioned, for 52 years, New Hanover Regional Medical Center has really been the regional referral center for a seven-county region, being the leading provider of health care throughout all of Southeastern North Carolina. We continue to expand our services, our facilities and our technology to meet the growing needs of our community.
In recent years, we have broadened our focus, working towards a mission of leading our community to outstanding health, focusing not just only on sick care, but how we can help fundamentally impact the overall health of our entire community. We envision being part of a thriving community that is a national model for health and wellness. This is truly a goal we all share. It is not exclusive to New Hanover Regional Medical Center. And this is really the better future we all want for our community.
However, those goals are very ambitious. And those goals will require New Hanover Regional Medical Center and the county to do things differently. And It will also require additional resources for all of us. The question is, how do we get there? And so as Chris mentioned, in evaluating any path forward, we will consider the best opportunity and the best way to advance the following priorities: improving access to care through consumer-centric options; advancing value of care really by continuing to improve quality but also reducing the overall cost of care; achieving health equity not only through community partnerships but also by impacting social determinants of health and ultimately eliminating the health disparities that we have in our community; supporting our staff and the culture that is made New Hanover Regional Medical Center one of the best places to work in the country.
Certainly partnering with our providers. We are fortunate to have some of the most talented physicians you can find anywhere right here in Southeastern North Carolina and so ensuring that we continue to make Southeastern North Carolina a great place to practice medicine.
Driving quality across the entire continuum of care, making sure we promote more seamless and coordinated models of care.
Continuing to grow, not only the types of services, but the scope of services that we offer for all regardless of their ability to pay.
And finally, certainly the ability to invest in not only our organization and securing the long-term financial viability of our health system, but also providing resources to the community to invest wisely. "

"The county shares the same vision and priorities that John just talked about. No. 1, improved access. No. 2, advancing the value of health care. And No. 3, achieving health equity all without regard to the ability to pay.
The county is equally committed to supporting the medical center staff and its culture, to growing the scope of care locally and investing for the long-term financial security of our health care system.
The amount of money the county would receive from the sale of the hospital would be secondary to advancing the common vision and priorities for health care in our community. To that end, it's important to note that any money that came from the sale of the medical center would go to the county as the owner of the hospital.
If the county did choose to sell the hospital, those dollars would afford the county the ability to strategically invest a significant amount of money back into the community it serves.
It could include investments in things such as more funding for public schools and our public school teachers to benefit all of our children. More investment in early learning and in continuing education so that we can build our county's workforce and attract new businesses and jobs. We could focus on small business growth and development by supporting entrepreneurship. We could address the affordability of housing by partnering to create available workforce housing so that any resident can live safely and securely where anywhere in the community.
We could focus on programs and policies to create better health equity across our community, which means things like more and better community health programs, resource assistance and meeting people where they are to help improve their health outcomes.
It could mean investing in public safety by putting more resources into our community to combat the opioid epidemic through effective enforcement and expanding treatment options.
We could focus more on infrastructure our community needs to meet a growing population. We all know we're growing fast. We are expecting a nearly 36% increase in the county's population by 2040, and we have to plan for that growth.
I say all of that to note that any revenue from the sale of the hospital would be reinvested into New Hanover County to help all of our residents and our businesses thrive for generations to come.
The first step to consider whether a different ownership structure with a like-minded partner could better serve the community requires direction from the New Hanover County Board of Commissioners. This consideration is being asked only for the purposes of determining No. 1 whether there is a more secure path to ensuring the best future for health care in our region, and No. 2 providing for the overall well-being of our entire community."

"So If you listen to Chris and you hear all of the great things that can be accomplished and you really look at the opportunity to create a better future for our community, now is a good time to have this conversation and really to explore how we can take not only our organization but our community to the next level.
As Chris mentioned, we are a county-owned health system. However, the common misperception in our  community is that we receive local taxpayer support. We are 100% self-sufficient. As Chris mentioned, we're the largest county-owned hospital in North Carolina and the third-largest county-owned hospital in the United States -- yet the largest anywhere that receives no local taxpayer subsidy.
We have defied the odds for many years to remain an independent, stand-alone county-owned hospital as our industry has changed and evolved. A greater depth of resources from a larger health system partner could help us solve some of the challenges we face as an organization and as a community much quicker than we could do alone and certainly without needing a taxpayer subsidy.
To put that in perspective, over the past decade or so New Hanover Regional Medical Center has invested over a billion dollars in facilities and technology alone. Chris mentioned a significant growth in our population over the next several years. To meet those growing needs of a growing population we project that investment will need to be several billion dollars going forward. And while New Hanover Regional Medical Center is clinically financially and operationally strong today we recognize that to prepare for an uncertain future, we need to consider new ways to support investments in the people, the services, the technology and the facilities needed to make a significant difference in the health of our community.
We're fortunate to have this health system in our community. We're nationally recognized for our quality and our people. We've been recognized as a great place to work. And our staff and our providers are committed to improving care and the health of our entire community. As such, we would expect there to be a lot of interest in our organization and furthering the successes that we've had.
Our strength puts us in a great position to go through this evaluative process on our terms and not in a crisis situation. It will also allow us to take our time and make the best decision about the best path forward, whether that continues to be with the county or whether that is with a larger health system that shares our goals. We are open to determining if a partnership can add value not only to our organization but to our community and truly infuse resources to accelerate all of our efforts and make them even more impactful.
With the backing of a strong health system partner I believe New Hanover Regional Medical Center and our county can be even more bold in our pursuit of ensuring the community is able to access the care and support they deserve in ways that are more accessible, affordable and equitable.
New Hanover Regional Medical Center and the New Hanover County commissioners are committed to working together to chart the best path forward. I want to reiterate something Chris said at the beginning. Our county commissioners are committed to the health and wellness of our community and their role in ensuring New Hanover Regional Medical Center is positioned to advance them. Through this process our county commissioners are taking a very prudent and proactive step in evaluating the best way to secure the future of health care for our region.
Now, throughout this process, New Hanover Regional Medical Center's priority will remain patient care, quality and safety. We cannot let this process impact our daily operations and how we serve our community. After all, today, nothing changes for our people, for our providers, for our patients and our community. However, I hope we can all remain open-minded about the amazing possibilities this could present.
At this time, all we are doing is exploring the opportunities out there for New Hanover Regional Medical Center and for our community. As Chris said, we are not making a decision to sell the organization. We're just seeing what the possibilities may be to advancing a brighter future for our organization and for our entire community."

"This process will include opportunities for public input. The county and the hospital will be hosting a series of community meetings where residents can learn more and have the chance to ask questions. The first of these meetings will take place Monday, Aug. 19 at 6 p.m. at the Northeast Library, followed by a meeting Tuesday, Aug. 20 at 8:30 a.m. at the Senior Resource Center.
The county and the hospital want to hear from the community about what's important to the community in the future of health care. These conversations will help shape what county and hospital staff present to the Board of Commissioners September the 3rd and will certainly inform the deliberation and the ultimate decision of the Board of County Commissioners.
This will be an open and very public process. The county and the hospital are both committed to ensuring this process is transparent and that our community remains well informed every step of the way.
I want to reiterate something that I said at the outset. No decisions about the future of New Hanover Regional Medical Center have been made. At the Sept. 3 meeting the Board of County Commissioners will discuss and then decide whether to move forward with exploring potential partners. If the board does choose to go forward, it would approve a resolution of intent to sell.
If the resolution passes, the county, in cooperation with the hospital, would begin developing a request for proposals based on the priorities outlined earlier by John. The RFP would then be distributed to organizations potentially interested in partnering with New Hanover Regional Medical Center. Once proposals are received back from any potential partner, they would be evaluated and ultimately a recommendation would be made, and that recommendation would be to move forward with one or more potential partners or maintain county ownership.
Additional employee, provider and community forums would also be held to share information and gather feedback prior to other votes of the New Hanover County Board of Commissioners.
To support our work in this process, the county and the hospital would partner with a national expert health care adviser that helps hospitals and health systems across the country determine how best to evolve for the future. If the board approves the resolution, the adviser would assist us in developing an RFP and potential partners would have a predetermined time to submit proposals. This process would help us to identify what types of future partnerships could be in the best interest of the community.
We do not know today who will submit. Based on the number and quality of responses, the list would be narrowed to those the county may want to explore more closely. If the process moves forward, it would take many months and perhaps longer. During this time, the county with the input of the New Hanover Regional Medical Center's board and its senior leadership and a team of health care and legal advisers would work diligently to chart the best course forward for our health system.
At the end of these discussions, the Board of Commissioners, again with input from the medical center's Board of Directors and its leadership, would determine what's best for our community and how we should move forward as a health system and If applicable with whom. We know there are many questions to be answered, and there's a lot we do not know today. We are just beginning to explore the idea of a potential partnership. We are committed to transparency throughout this process and keeping you, the community, informed every step of the way.
In collaboration with New Hanover Regional Medical Center, we have launched a website -- -- where anyone can learn more about the process, the criteria the county and the hospital would use to determine the best fit for our community and to get updates as they are available and to view a list of frequently asked questions. There's also the opportunity for people to submit questions directly to and or seek feedback through the website. ..."

Media Question: 
"New Hanover Regional has some subsidiaries -- Lower Cape Fear Hospice, those types of things, would those be part of the partnership deal or how does that work?"
"So, all of the components of our organization that are part of what we call the obligated group would be part of this proposal. So that would not include Lower Cape Fear Hospice. That is a different type of relationship. But it would include New Hanover Regional Medical Center, our physician group and things like that."

Media Question: 
"What about Pender County Memorial [Hospital]?"

"We have a long-standing relationship with Pender hospital, literally 20 years last Sunday, and that is a very important partnership. But that is a lease arrangement where we fully operate Pender hospital. That has two more years left on the lease so that relationship is secure throughout this process. And that partnership remains very important to us, and I would imagine will be a very important consideration In the process of evaluating a potential partner."

Media Question: 
"If you did decide to go ahead with pursuing options and then did decide on selling the hospital would that automatically mean that Pender Memorial would be taken under the wing of the new owner?"

"Well, so the lease would remain in effect, and so I would expect the new owner to certainly honor that lease for the duration of it. Technically, Pender County owns Pender hospital. We do not currently own it, nor would the ownership change because of this potential situation. But I would certainly expect that relationship to continue."

Media Question: 
"And that's something you guys would look for and picking a potential [buyer]?"


Media Question: 
"There's several capital projects currently underway, how would that play into formulating the initial RFP that you would put out to potential partners?"
"So the capital projects that we have underway are already accounted for and funded through either our internal operations or through bonds that we have issued, so I see no impact whatsoever on us continuing with all of those capital projects as planned."

Media Question: 
"So there's a huge amount of infrastructure and real estate that enjoys tax-free status. How does that play into a new management group coming in? Are we talking about someone to just run the day-to-day operations? Are we talking about people taking over real estate property?"

"If the process moves forward, we would certainly see what types of proposals we receive. I would imagine there will be proposals of all different natures. But if we are talking about the potential sale of the organization, it would include all of the assets, all of the property that is currently owned by the county and New Hanover Regional Medical Center."

Media Question: 
"And as a private company, they would then be property tax-paying corporate citizens?"
"Well so it depends on the type of organization that we partner with. So most organizations in health care are just like us, they are not-for-profit organizations, which means they do not pay property tax, sales tax, those types of things. And so that would be the same as it is today. There are for-profit entities in health care that do this as well. They do pay taxes, since they are a for-profit entity."

Media Question: 
"About how much is the hospital worth?"

"So we really don't have an exact price today. I mean, the way I describe it is, you know, we are a very strong organization in a very attractive market and so I would expect we would see that in the financial commitments of any organization that would submit a proposal. But obviously, if you look at the market and what is going on around the country, it is potentially in the hundreds of millions of dollars, potentially up to a billion-dollar range."

Media Question: 
"You had talked a lot about health equity. How would a sale of the hospital affect the treatment of people with no insurance, being that the county is required to treat them"

"So, that's a great question. We are the safety net provider for the seven-county region, and New Hanover Regional Medical Center and the county commissioners are committed to that mission. Continuing our charity care policy and providing services to everyone, regardless of ability to pay is certainly a key criteria and priority in any proposal that we would evaluate."

Media Question: 
"And following up on that, since the county does have this policy ... is there a debt that the hospital has for kind of providing this care? Is there money that you guys do owe for that?
"So we don't owe. We fund that out of our own internal operations. And we, again, are 100% self-sufficient, so the county does not have to pick up any of that tab. This year, it will approach $200 million in uncompensated care that we provide to the community."

Media Question: 
"Chris, can the county mandate, not just that the charity care but also the kind of outreach projects you're talking about, can the county essentially say, 'We're not even going to entertain an RFP unless you're going to be, you know, reaching out into the north, into Murrayville, into Apple Road [Castle Hayne], into Monkey Junction, stuff like that."

"It is absolutely my opinion that the county along with the hospital can craft all of its priorities in the request for proposal. And I believe, if we were to proceed, there would be a very high bar set to continue the outstanding work that New Hanover Regional Medical Center's doing today, but also looking into the future. So the county would very much be in a position to determine what services at a minimum and what the targeted approach to those services would be."

Media Question: 
"How long has this been on your radar?"

"Well, I think the hospital's been in existence for 52 years, so I would say probably 52 years. So I've been here 15 years, I can tell you that our leadership, our board and the county commissioners are always talking about what is going on in health care, the position of our organization, how we're serving the community. So that has been an ongoing conversation for the 15 years that I've been here. You know, more recently, and getting specific about this exact proposal has been over the past several weeks."

Media Question: 
"Where did the idea come from? Who's idea was it to get the ball rolling?"

"I think as John said, there's regular discussion between the Board of Trustees and the county commission and administration about what the future of health care is. So there is not any one triggering event that said, this is the time to go. What I think we all know and recognize is our hospital is financially, operationally, clinically -- by any measure-- the strongest it's ever been. What the future of health care looks like is so uncertain that I don't believe John or I could sit here and say with a high degree of certainty that the future is as bright as the past has been. So if we're at the strongest position and the certainty is not there, at some point, you probably should look at alternatives. And if we're going to look at alternatives, I'm of the opinion, we should do it when we're in a position of strength to the point that we could dictate what terms of engagement in a future partnership might look like. So there is no one triggering event, no one decision to proceed today."

Media Question: 
"I do want to take seriously the idea that you might not do this, right, that you might stay with the county. One, what kind of fiscal concerns do you have if that's the case, and the second part would be, are there specific equity addressing programs that you think the medical center can't do just by staying with the county?"

"So I couldn't speak with great authority to the risks other than to kind of mirror back what John said. If the cost of uncompensated care in the last year was $200 million, when the hospital does not generate enough revenue to cover its expenses -- of which that $200 million is an expense -- because it's a county-owned hospital, it would be the county's responsibility to find the revenue to support that. So taking the long-term view, and I don't think John or I would suggest that result is in the near-term future, but it is reasonable and conceivable to think that in the future, the county will have to subsidize the cost of operating the health care system in our community if we keep the same model ... health care is changing faster every day and every month and every year now, and going forward than it has probably in the last 20 years. ... So the real concern and risk is not knowing at what point the hospital is not in a positive cash position and the county has to explore all of the avenues available to it to underwrite the cost. I don't think we can lose sight of that we're the third-largest county-owned health care system in the country. The two that are larger than us both receive significant county tax subsidies. And that would take on the form of property tax sales, tax revenues and a whole range of other revenue sources."
"I think the flip side to that, I mean Chris is absolutely correct, I think the flip side to that is let's look at the positive aspect as well, which is our community is growing, which means the need for health care is going to continue to grow. And so as we look at the needs for and the expectations of our community, we want to have a great community with great health care, which we have. How do we not only sustain that but ensure it continues to advance? And as I mentioned, we're talking about hundreds of millions, if not billions of dollars worth of investment needed in infrastructure in health care. You can think about a heart vascular center, you can think about a neurosciences center, you can think about a community hospital in the Scotts Hill area, ambulatory facilities around the region -- all things we would want and expect out of great health care for our community and making sure that we evaluate alternatives to how we accomplish that. And so I think, you know, it's not only the change and uncertainty in the health care industry, but also looking at the positive aspects of we're fortunate t o have a growing community and how do we continue to meet those growing needs with outstanding health care like we have been able to for the past many years?"

Media Question: 
"I was told that you guys at New Hanover Regional have not had layoffs for quite a number of years. How could a sale positively or negatively impact staffing?"

"I can tell you that in the 15 years that I've been here, we've had a no-layoff policy. Our commitment is too our employees. The reason we are in the position we are in is because of our employees. And so that is an organizational culture that we have created and a commitment we've made to our employees. And any potential partner that we would ever consider seriously, in my mind, would be based on how they would not only retain all of our employees, but how they would grow and develop such a great workforce."

Media Question: 
"Obviously, in the past year NHRMC has taken steps to raise its minimum wage for employee well above the state and federal minimum. Would maintaining and honoring that increased minimum wage be a requirement of the RFP?"

"... Our healthy community wage, we've been able to increase it now over the years, and that is something that we would want to continue to increase. I think the ability and backing of a strong health system partner could give us the ability to not only maintain that, but hopefully continue to raise that in the future"

Media Question: 
"John, attracting and retaining health care talent, this can be hard. It's a competitive environment out there. So with this possibly injecting some uncertainty into the future of somebody coming to New Hanover Regional, how fast would you like to see this  process decided one way or the other?"

"It's a very interesting balance because this announcement and this process does create anxiety. It does create uncertainty. And you know, that does put questions in people's minds. And so again, making sure we retain the talent we have is my first priority. As we move forward, making sure we can continue to attract talent to our organization, both physician talent as well as as my staff, remains extremely important. So on one hand, you'd want the process to move quickly so that there's more certainty. On the other hand, you know, we're not under a crisis situation, and so we want to make sure. This is an extremely important decision. It would be the largest decision in the history of our organization, and so making sure we take our time and evaluate this process very thoughtfully, very deliberately, to end up with the right answer versus a quick answer, I think is much more important. And that would be the way I would recommend that we proceed."

Media Question: 
"Along those lines with uncertainty, does this, having it out there, have an impact on major decisions you're going to have it whether it's new capital projects or even [whether to] join the State Health Plan Network? Do you have to put things on pause until this is decided?"

"Not really. I mean I think back to the question about our capital projects, we've planned our capital projects or multiyear projects, typically, especially when there's hurricanes involved. But you know, those are multiyear projects that we have planned for, have funded in advance. And so I don't see any of those being impacted. Obviously, depending on how the situation goes and how this process evolves, we'll need to evaluate our organizational capacity for change and how much we can handle at one time. I think the important thing is, the priority now and going forward will remain patient care, quality and safety. And so that is absolutely our focus. And that does not change."

Media Question: 
"Do you have a preference for for-profit or nonprofit partner? How do you think a for-profit would change operations?"

John Gizdic, NHRMC president and CEO 
"I think it is important for us to get an organization and a partner that is a cultural fit for our organization. I truly believe the culture we have at New Hanover Regional Medical Center is very unique and very special. And so as we move forward, and we look at potential partners, if this process gets to that point, we cannot underestimate the importance of having an organization that fits culturally, not only with our organization, but with our community."

Media Question: 
"You keep mentioning finding a partner that fits, having [specifics] in the RFP, how binding is that? ... Even if there's an RFP, is that in perpetuity? What guarantee do people have that if a company comes in and purchases the hospital that 15 years down the road, it's not going to be a completely different place that doesn't fit.?"

"And that's why we would go through an extensive negotiation and reach terms and develop a contract that effectively is binding. And I'll use a John Gizdic analogy, the idea of purchasing your house, there's the purchase price, but there are all of the conditions that you would write into the purchase and ultimately the execution, and those things do become binding. So the county, if we proceed along with the hospital would work very hard to ensure guarantees around the long-term commitments, whether it's around capital, retention of the physician group, what that charity care policy is going to be, what the programs and policies around health equity are going to be now and into the long term. We have the ability through contract negotiations. And I'll say this publicly, I think we've got an outstanding team on both sides, a hospital team, an accounting team that are very talented and capable. If we were to proceed with putting together the very best deal that ensures the best long-term health care for our community."
"And again, Chris is absolutely correct. We're also assuming that the status quo is going to remain forever. And I think we're kidding ourselves if we think that is the case. The fact is, things could change in the future, regardless of ownership status. And so even if we do move forward and decide remaining with the county is the most appropriate approach, we need to change and evolve with the industry and making sure that we're positioned to be here for generations to come. And so, you know, that could be the case, even if we remain independent."

Media Question: 
"Have you guys over the last couple weeks discussed what would happen to the hospital's management structure in terms of the Board of Directors and administrative staff [under a deal]?"

"... If we proceed, determining what a local board of governance ought to look like, what it should look like, needs to be very clearly articulated in a request for proposal. I think our view is, certainly we have tremendous assets, and if we went forward, someone would want a partner to have the assets, but they're really acquiring the talent. And so it would be an expectation that the talent that is in place is the talent that will continue to lead the evolution of health care and the delivery of it going forward. And so that's going to be central, certainly to any request for proposal assuming the board directed us to proceed and absolutely would be written very tightly in an ultimate contract that they convey one way or the other."

Media Question: 
"I'm trying to imagine a scenario where someone comes in from your descriptions, essentially buying the hospital and taking on the financial risk, putting their name on it, but leaving everything else totally in place. That doesn't sound like a business deal."

"I believe that a good business deal would include maintaining the resources and the people that have generated the health care success that we've had. That is how strong and, I think, unique our health care system is being county owned and in the position that it is in, that we have a unique opportunity to negotiate on our terms and do everything possible to guarantee the future. Any organization who would explore partnering with us is doing it largely because of the position and the talent that has put it in this position. I genuinely believe that and believe that the outcome, if we went forward, would be a very strong team made up of the folks that are part of that organization today. There's 7,000 men and women who have made this one of the finest health care systems in the country."

Media Question: 
"You said, obligated unit. So your intent is to keep the ACO in it as well, as part of the RFP? Are there any other things that you already know now that you would like to see in the RFP?"

"Anything that's part of our organization. Yeah. So I mean, this is really an exploration about our entire organization. And I think, you know, we refer to ourselves as the hospital a lot. We really have grown into a comprehensive health system over the past many years. Also part of our strength is having all of those different components to our organization. And again, anybody that would be looking at the opportunity to come to Southeastern North Carolina would see all of those components and the strength they are together. And so making sure we keep those components together and we're able to build on that in the future will be extremely important."
"I'd like to add to that if I may. And I think John spoke very well to what the values and the priorities in the solicitation would have to be and that's going to inform the RFP no question about it. But we have a tremendous asset. And so as people evaluate that, they're going to understand what the long-term value is, and we're going to be able to negotiate through those things. And so the RFP is going to be reflective of our strength. But that's why we're going to have community meetings as well. We need to understand and hear clearly what our residents value, expect and need for health care in the future. So it might be premature to say these are the 35 things that would be in an RFP because there may be 60 others that we hear through these community discussions and what the county commission hears. And so we're just not in a position to speak with authority to what the RFP is going to look like. But the values are consistent where they are going to inform what we do."

Media Question: 
"...If the sale does go through, and the county gets this whole big pot of money, will you recommend that it be laid out specifically how money is spent?"
"Certainly I think it is good administration to recommend what ought to be informed in an investment strategy. But it ultimately would be the decision of the county commission. But whatever the proceeds are, I think, have to align with that overall concept of advancing the overall health and well-being of the community. So that's why we would look at things like public education, more public schools, more public school teachers, what can we do around workforce housing and affordable housing? What are the specific programs to continue to drive health equity in our community, eliminating barriers. So there would be a framework of things to do, but ultimately, the decision on a yearly basis would be that of the county commission. But we would lay out principles of what an investment strategy ought to be and how to protect the asset, the core of what the purchase price is and ultimately grow that in the future."

Media Question: 
"This kind of mergers and acquisitions activity nationally has been on record levels since 2017. So can you  speak real quickly about some of those industry conditions that you guys are also seeing that's driving why we're talking about this now?"

"If you look at what's going on in the health care industry, you know, as we talked about, there's a lot of change and uncertainty occurring. I mean, you watch the news as well as report it. And so every night, we see something about health care at the state or federal level that is changing being reported. And so as organizations look at some of that change, related to changes in reimbursement, the transition from really sick care and fee-for-service to a more value approach, meaning that the health care system is more financially responsible for the entire health of the patient, as well as the capital commitments needed to not only sustain but grow health care organizations, they're finding that need for scale and purchasing power and those types of things as well as the access to capital and the cost of capital can be more attractive as part of a larger health system then you might be able to get on your own. ... You think about it in our everyday lives. It's why things are cheaper on Amazon than they might be somewhere else. ... We all don't pay the same price for a car, so there are a lot of analogies in our everyday life where scale makes sense. And the ability to partner with larger organizations brings value to an organization. And that's what I think you're seeing play out. You know, it probably sounds a little self-serving coming from me, but as Chris mentioned, we are a very unique organization. We're in a position of strength and being very strong currently. Not all health systems around the country are in that position. And so some of the mergers and acquisitions you're seeing are a very different situation where they need somebody to come in and take them over so that they can actually survive. We're very fortunate to not be in that position as an organization and as a community. That's why I do believe this is the best time to ask this question, because we are in that position of strength. That really gives us the ability to do it on our terms. And we're not in a crisis mode so that we can make the right decision and take our time doing it. And if the decision is not to do anything at this time, we have the ability to do that. If we do find a partner that makes sense for our organization in our community, then we can negotiate."

Media Question: 
"Some of those cases though, health care costs have gone up after the deals are finished. ... How do you safeguard against that happening?"

"So value, and I define value as in higher quality and lower cost. Value is a key tenet that we would evaluate any proposal on. We have been working for years on lowering the cost of health care in this community, looking at clinical variation, keeping people out of the hospital. And so making sure we continue to make health care more affordable, even though it remains very expensive all over the country. And so making sure any partner organization would help us drive value and lower the overall cost of health care is a key priority, not only for our organization. But when we look at employers in our community, when we look at the potential for economic development in our community, lower health care costs will be attractive for all of those. And so that is a priority for both New Hanover Regional Medical Center and the county commissioners."
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