2008-09-25 Special Meeting
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 31
JOINT MEETING WITH NEW HANOVER REGIONAL MEDICAL CENTER PAGE 468
BOARD OF TRUSTEES, SEPTEMBER 25, 2008
ASSEMBLY
The New Hanover County Board of Commissioners held a joint meeting with the New Hanover Regional
Medical Center Board of Trustees on Thursday, September 25, 2008, at 3:00 p.m. at Cape Fear Hospital, Cape Fear
Building C Conference Room, Wilmington, North Carolina.
Members present were: Chairman Robert G. Greer; Commissioner William A. Kopp; Commissioner Nancy H.
Pritchett; County Attorney Wanda Copley; Clerk to the Board Sheila L. Schult; County Manager Bruce Shell; and
Finance Director Avril Pinder.
Vice-Chairman William A. Caster and Commissioner Ted Davis, Jr. were absent.
Board of Trustee members present were: Chairman Ronald J. Isyk; Carl D. Brown; Patricia L. Leonard; Helyn
R. Lofton; Nancy S. Marks; Dr. Joseph A. Pino; David B. Sims; and James E. Vann.
Call to Order
Chairman Greer and New Hanover Regional Medical Center Chairman Ronald J. Isyk called their respective
Boards to order.
State of the Medical Center
New Hanover Regional Medical Center President and CEO Jack Barto presented the following information:
Who We Are:
?
New Hanover Regional Medical Center (NHRMC) is the only place in the region for specialized
services in cardiac, orthopedic, oncology, vascular, trauma and neonatal care.
?
Nursing program is recognized as ?Magnet? by the American Nursing Credential Committee.
Currently up for re-designation.
?
Orthopedic program recognized as ranking among nation?s top 10% fourth year in a row.
?
Physician staff of 520 offers specialties comparable to larger metro areas.
Fiscal Year 2008:
?
Length of stay average 4.79 days
?
Inpatient surgery average 10,821
?
Outpatient surgery average 19,499
?
Emergency Room visits average 112,587
?
Clinic visits (exclude oncology) average 50,795
?
Operating gain in the amount of $21.7 million
?
Operating margin ? 3.41%
Fiscal Year 2009 Budget:
?
Operating expense in the amount of $655.8 million; increase 7.1%
?
Personnel expense in the amount of $221.5 million; increase 4.3%
?
Supplies expense in the amount of $134.8 million; increase 5.2%
?
Bad debt in the amount of $81.3 million; increase 11.6%
?
Operating gain in the amount of $23.8 million; increase 1.0%
?
Operating margin in the amount of 3.5% million; increase 3.0%
?
Full time employees ? 3,919; increase (0.5%)
Regional Impact:
?
Impact of more than $1.2 billion annually on New Hanover County?s economy.
?
More than 8,300 jobs depend, directly or indirectly, on our viability.
?
Largest employer in Southeastern NC.
?
Industry cannot recruit key personnel without presence of strong medical center.
Mr. Barto continued reporting that their organization is moving from using New Hanover Health Network as the
master brand of the organization to using New Hanover Regional Medical Center as the primary identity.
Project Update:
?
Betty H. Cameron Women?s and Children?s Hospital ? opened September 14, 2008
?
Surgical Services ? opened June 30, 2008
?
Renovating the patient tower is proceeding
?
Creation of an exterior identity and dedicated entrance for Heart and Vascular Center is planned
?
Expansion plans for moving imaging services to the ground floor
Strategic Response:
?
Focus on service line growth:
Cardiology ? RACE; STEMI; CCH joint venture
o
Women?s & Children?s ? new hospital; increase pediatric specialties; PICU
o
Oncology ? SARO joint venture; Radio-surgery; enhanced capabilities
o
Surgery ? Orthopedics; Robotics; ASC joint venture; new pavilion
o
Others ? Neurosciences; Imaging
o
?
Determine an ambulatory strategy:
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 31
JOINT MEETING WITH NEW HANOVER REGIONAL MEDICAL CENTER PAGE 469
BOARD OF TRUSTEES, SEPTEMBER 25, 2008
Beyond increasing capacity and efficiency at the main campuses, ambulatory planning is the
o
next logical phase of strategic development
Ambulatory services represent high margin business
o
Introduction of more competitors who are capturing profitable business
o
With entry of regional systems, ambulatory becomes feeder for inpatient business
o
If NHRMC does not act to take advantage of opportunities, competitors will
o
First entry into new growth markets will generate brand equity for future development and
o
all sites represent additional access points in the region
Developers are eager and ready to partner with NHRMC, as are a growing number of
o
physicians
?
Develop a collaborative physician strategy:
For Physicians:
o
?Enables physicians to focus on practicing medicine without the hassle of running a
business
?Provides a direct financial improvement through better managed care rates and lower
expenses
For Carolina Healthcare Associates:
o
?Provides management and infrastructure to improve overall financial performance of CHA
toward benchmark levels
?Positions CHA with a competitive alternative in the market for physician employment
?Creates vehicle to support ambulatory strategy and secure referral network
?
Continue operational and financial improvements:
Revenue improvement from managed care contracts of $9M+
o
Denial write-offs improved by $1.4M
o
Revenue improvement from compliant documentation/coding of $3M
o
ED case management has increased admissions through ED by 2%+
o
Revenue improvement from inpatient PTCA conversion of $625K
o
Pharmaceutical expenses reduced by $500K+
o
Supply chain savings of $2.3M+ from GPO optimization, CRM devices and hip/knee
o
implants
Service contract savings of $300K+
o
Labor expense reduction of $800K+ from reduced sitter use, overtime and bonus shifts
o
?
NHRMC proposes to expand services for those in mental health crisis. Key components of proposal
include:
Creating physical space near the Emergency Department to serve as entry point for patients
o
in mental health crisis
Adjusting staffing for emergency and outpatient services to allow treatment of these patients
o
in a clinically appropriate manner
Alternate methods of transporting patients to state hospitals or other levels of care that are
o
more humane for patients and less costly to the county and state.
Working with state delegation and county staff to secure funding appropriate for this level of
o
clinical service
Cannot provide this service without appropriate capital and recurring operational funding
o
Summary:
?
NHRMC is the leading provider of health care in the region, a vital economic engine and provides
millions in charitable services and community benefit.
?
NHRMC is expanding to meet the community?s demand for services.
?
NHRMC faces unprecedented challenges from new competitors, as well as changes in the industry
and demographics.
?
NHRMC has developed strategies to meet those challenges and move health care in this region
forward.
Adjournment
After a brief question and answer period, Chairman Greer thanked Mr. Barto for the update and requested a
motion to adjourn the meeting.
Motion:
Commissioner Kopp MOVED, SECONDED by Commissioner Pritchett, to adjourn the meeting. Upon vote,
the MOTION CARRIED 3 TO 0.
Chairman Greer and Board of Trustee Chairman Isyk adjourned the meeting at 4:20 p.m.
Respectfully submitted,
Sheila L. Schult
Clerk to the Board