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HomeMy WebLinkAbout2019-12-05 PAG FinalPARTNERSHIP ADVISORY GROUP DECEMBERS, 2019 MEETING PAGE 1 ASSEMBLY The Partnership Advisory Group met for a meeting on Thursday, December 5, 2019, at 5:33 p.m. in the Andre' Mallette Training Rooms at the New Hanover County Government Center, 230 Government Center Drive, Wilmington, North Carolina. Members present: Co -Chair Barbara Biehner; Co -Chair Spence Broadhurst; Vice Co -Chair Bill Cameron; Vice Co -Chair Dr. Joseph Pino; Members: Evelyn Bryant; Robert Campbell; Chris Coudriet; Cedric Dickerson; Brian Eckel; Jack Fuller; Hannah Gage; John Gizdic; Dr. Sandra Hall; Meade Horton Van Pelt; Dr. Chuck Kays; Tony McGhee; Dr. Michael Papagikos; Dr. Mary Rudyk; and Jason Thompson. Members participating via telephone: David Williams Members absent: Dr. Virginia Adams Staff present: Clerk to the Board Kymberleigh G. Crowell; Assistant County Manager Tufanna Bradley - Thomas; Chief Financial Officer Lisa Wurtzbacher; Chief Communications Officer Jessica Loeper; Budget Officer Sheryl Kelly; New Hanover Regional Medical Center (NHRMC) Chief Communications Officer Carolyn Fisher; NHRMC Chief Legal Officer Lynn Gordon; NHRMC Chief Strategy Officer Kristy Hubard; NHRMC Media Relations Coordinator Julian March; NHRMC Executive Vice -President and Chief Financial Officer Ed 011ie; and David Burik, Navigant Managing Director. Co -Chair Broadhurst called the meeting to order and thanked everyone for being present. Co -Chair Biehner thanked everyone for attending and stated the hope is to cover the three key items on the agenda in the time allotted. Co -Chair Broadhurst announced that Agenda Item #2 Updated on RFP for Financial Advisor would be moved to after Agenda Item 4. APPROVAL OF MINUTES PAG Member Eckel MOVED, SECONDED by PAG Member Gage to approve the November 13 and 20, 2019 minutes as presented. Upon vote, the MOTION CARRIED UNANIMOUSLY. DEVELOPMENT OF GOALS AND OBJECTIVES: DISCUSSION OF GOALS 6 THROUGH 10 (SLIDES 7-13) Co -Chair Broadhurst stated that Goals 1 through 5 were covered at the prior meeting and 6 through 10 would be covered during this meeting. As a reminder, the members were asked during the last meeting to submit any suggestions prior to today's meeting to be incorporated into the review. The process to work though the goals and objectives will be similar to last time. Goal #6: Driving Quality of Care Throughout the Continuum (Slides 7-8) Mr. Gizdic stated as to the comment of an "illustration of what we may want," healthcare continuum means all aspects of the healthcare experience for an individual from primary care doctor, to specialists, to if an individual ends up in the hospital, etc. all the way through to hospice care. All of the aspects do not fall under the same umbrella and there are different companies, providers, and players involved which leads to fragmented care in a lot of cases for the patient. NHRMC has worked on that, has a strategy, and its providers and staff have done a better job of it, but NHRMC needs to make it better. It needs to be a smooth, seamless transition for the patient regardless of the setting or who owns it and the health system in general needs to coordinate that care for the patient and their family across the entire continuum. That is the nexus of this goal. Mr. Gizdic stated as to the comment about the depth and breadth of care management and coordination, the comment can be applied to several goals and it is about Advanced Practice Providers (APPS). Whether it is a Nurse Practitioner (NP), Physician's Assistant (PA), or other types of clinical providers, the need to grow their presence in the NHRMC organization, the community, and in the care team is absolutely correct. It is going to be a critical success factor going forward and with the provider shortage, there are not enough physicians being produced in the country, and even if there are enough being produced there is a mal- distribution of them so having APPS supplement the physicians will be very important in the future. The discussion of a PA program being started at UNC -Wilmington (UNCW) is an example of how it could not only be a potential partner to help NHRMC with APPS, but it can be taken further by doing it right here in this community and can be made into an economic development initiative. As to the comment about the Magnet Recognition Program, Mr. Gizdic stated this is one of many organizations that are similar to the Good Housekeeping Seal of Approval. The suggestion of understanding how other potential partner organizations approach it is really around nursing, self -governance with nursing, and enhancing the practice of nursing. To him it is more about the tactics and outcomes versus whether it is magnet or some other type of program. It is something that can be asked about in the RFP. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 2 As to adding access programs and offerings that further NHRMC's work as a high -reliability organization, Mr. Gizdic stated if one thinks about the airline industry or nuclear industry, a lot is heard about the six -sigma, meaning small errors in a large population of events. It is an initiative that NHRMC has undertaken, partly with the lean principles, but also through an initiative that is called "Just Culture" which is being implemented starting with the medical staff. The physicians are going first which is very admirable, and not seen across the country, to create an environment and a culture where folks are encouraged to speak up, identify potential errors or safety situations ahead of time so they can be avoided, make adjustments, and correct for those is what NHRMC is trying to do to increase reliability and safety. As to the comment on technology and analytics as part of this goal, Mr. Gizdic stated NHRMC has the data for itself but not the data for other organizations such as WellCare, doctors' offices, nursing homes, etc. The question is how does the data sharing get created as well as the analytic systems to be able to go into the data and understand what is being done across all the settings. Those are capabilities NHRMC currently does not have and it is a significant investment of millions of dollars a year. One system being looked at right now is $2 million a year just for the system and possibly another million a year to hire the staff to be able to administer the system to understand what that system is saying. It equates to $2 to $4 million each year for just the one system. In response to questions, Mr. Gizdic stated the system being looked at does not "talk" to other provider systems and/or healthcare systems. The interface systems have to be purchased, which are an additional expense. It absolutely needs to occur and it is not an insignificant initiative and investment to make it happen. As to the comment concerning population health management, Mr. Gizdic stated the only data NHRMC has on a patient is what is provided when the patient is in the hospital. It does not know what happens to the patient once he/she visits a doctor outside hospital, what type of vitamins and/or herbal supplements are being bought at the drug store, etc., which can all interact with a person's care. There is a definite need to create the digital infrastructure to provide the support. In response to questions, Mr. Gizdic stated that the digital infrastructure would be a combination of being handled internally and contracted out as NHRMC is not large enough to handle it internally on its own. The scope and scale is significant. NHRMC also needs the skills, which it may have internally and which a potential partner may be able to bring forward, such as data scientists and actuarialists who can interpret the data, understand it, and make the connections to things that others would not see otherwise. For example, NHRMC recently performed a data analytics pilot on sepsis. The ability to have the data in real-time rather than waiting for a report in the future, allowed for a visibility into the information that was never known before. A brief discussion was held about the best use of APPS being in a team setting. They function very well in a team setting, but there is still a need for a doctor. Several PAG members agreed while APPS are needed, it needs to be clear that doctors are still needed on the team. As to the comment concerning mentioning the collaboration in the region to cover the continuum, Mr. Gizdic stated yes, it will be added and collaboration is still needed. NHRMC does not have to own everything nor is that the goal. The collaboration needs to continue and be enhanced by a potential partner, not inhibited by a potential partner. As to the comment on the benchmark key quality of care metrics, this is absolutely something that in thinking about criteria for a partner there is a need to understand how they perform in quality. No one will be perfect in everything, but there is a need to understand how a potential partner performs in different measures. A brief discussion was held about reviewing the ten goals and objectives in a way for the members to understand them from a NHRMC perspective, what is an inherent strength and where it is not, as all may not be equally important from an RFP perspective. Mr. Gizdic stated that all of the goals and objectives are important because they are tied to the strategic plan and NHRMC has to accomplish each to some degree and level of expertise. Suggestions were made that after working through the items and during the time the RFP is out for bid, the members look to identify where the deficiencies are and what the team can prioritize for when the responses come back to use in the evaluation of the responses. Once all ten are in the same state where they have been well versed, revised, and approved is when the group will need to look at where the deficiencies are and identify the top priorities. A brief discussion was held about the analytics, knowledge sharing, and the importance of it for the hospital and physicians. Members agreed it is something that needs to be looked at and in vetting the responses to the RFP, looking to see who has the ability, is already implementing it, and how it is being effectively used and managed. Goal #7: Improving Level and Scope of Care (Slide 9) Mr. Gizdic stated Goal #7 to him is about not only about maintaining and growing services that are already available and adding additional services in the market to meet community's growing needs, but also being available to everyone regardless of their ability to pay. As to the comment about the terminology "sophisticated," a different word will be figured out to be used. As to the comment about how to strengthen and maintain the hospital's clinical capabilities, Mr. Gizdic stated this is part of the essence of this whole process. When discussing growing and advancing clinical services, you need the service, the facility, the PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 3 technology, the staff, and none of it can be done without a provider. There is a significant investment in any service and all of the components need to be addressed as part of any service offering. As to the comments on novel therapies, Mr. Gizdic stated an area to think of is genomics. For example, it is known there are cancer treatments that are getting specific based on a person's specific DNA. NHRMC is not large enough to do this nor do they have that kind of expertise in-house. However, there are large health systems that have those capabilities and those type of programs that NHRMC might be able to tap into. As to the comments on what is the NHRMC Innovation Center, Mr. Gizdic stated it was launched about a year ago by working with tekMountain and UNCW Center for Innovation and Entrepreneurship (CIE). Innovation has many definitions, but to him and from a NHRMC perspective, it is a mindset. To him it is about creating a culture where we look at the processes, products, and everything differently and asking if it can be done in a different way. There have been some ideas that have come out of it and the question becomes how to scale them and how to take a product to the market to actually make money on a new invention or product. As to partnering with a state of the art care provider innovators, there is great entrepreneurship and innovation in this community and it could be done with others who have potentially larger footprints, other expertise and skills around innovation that could possibly help and be a benefit. It could be something to add and explore. In response to questions when the group will get to the specifics about sophisticated services that are being looked for, Mr. Gizdic stated he thinks those will be partly in the RFP questions when it gets to that point. He is not sure if even in the RFP there will be a list of every single service that is wanted. There will probably be some immediate things that are known that NHRMC is trying to grow and some things, such as geriatrics and women's health, that can be named specifically in the RFP. There may be a section for the responder to explain what they have done and how they have done it. If there is a desire to list something specific, it can be included in the RFP with an ask of the responder to explain how they advanced a certain type of item to get a specific answer back. In response to questions, Mr. Gizdic stated that the responder's philosophy on when to keep a service local or transfer it out can be included in the RFP. He thinks it should be asked directly what the partner does about having services leave the market and what they can do to ensure there is not only a maintaining but a growing of services here. If NHRMC partners with someone, there are going to be quaternary levels of services that NHRMC would not offer here, appropriately. If a partner offers those services, how does NHRMC know its patients are going to get the fast -pass, the preferred treatment, and access to the next level of service as appropriate, if needed. He thinks that is another part that can be included. Goal #8: Investing to Ensure Lona -Term Financial Security (Slide 10): Mr. Gizdic stated that Goal #8 is a bit of a catchall. Part of it is talking about NHRMC's capital plan and future while also being about NHRMC's operational performance. There is a need to make sure the financial headroom is available to be able to make it through the transition of moving from fee-for-service to a value - based system. The transition will occur periodically over time and there is a need to determine how does NHRMC ensure it remains profitable enough throughout the transition to make the investments in the fee-for- service world, but also shift the business model with the new systems, capabilities, and new technologies needed to move to value -based. As to the question about executing the long-range strategic capital plan or finding the way to execute it, he would say it is both in looking at how to ensure access to the funds now and capital over the next decade or next 15 years as well as in the shorter term. As to the comment if maintaining material payer contracts or seeking more sophisticated managed- care contracting strategies are being done, Mr. Gizdic would say both are being done. If you're commercially insured, there is about an 85% market share for Blue Cross/Blue Shield of North Carolina (BCBSNC) who is the dominant monopoly in commercial insurance. The BCBSNC contract is up for renegotiation in 2020 and BCBS is shifting a lot of its business, especially in North Carolina, to value and the question is how to administer that because it has not been administered like that before, but it's the direction the industry is going. Part of the conversation is not wanting the community to be impacted negatively by any potential partnership. Regarding the most appropriate and constructive options of approaching each of these objectives, Mr. Gizdic would anticipate these as being multipart. Questions will need to be asked of how to commit to capital in a partnership, how a potential partner makes capital accessible and markets available to NHRMC going forward, as well as other aspects. He believes they need to get very specific and detailed to understand this as there will be different impacts for each of the objectives. Regarding the collections and how aggressive it should be, a suggestion was made that for the RFP there be a similar philosophical approach to NHRMC. Mr. Gizdic said that is a key point that should be included. It's not just about charity care, which is important and will be part of the RFP. The collection practices are just as important, if not more important, because that is what the community is going to feel. If that changes and someone gets much more aggressive, puts liens on the houses, and sues patients, that is a very different philosophy and approach than NHRMC has ever taken. Not that NHRMC does not try to collect the money owed, it does, but it is not as aggressive as others. This is very important to include in the RFP. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 4 Goal #9: Strategic Positioning (Slide 11): Mr. Gizdic stated Goal #9 is an opportunity to explore how a partner could help position NHRMC strategically in the entire region. This could include partnering with other entities in the region, a regional strategy and collaboration, opportunities for them to relocate a division of their system in this market and grow jobs here, or opportunities for a business unit. This is a way to see what would not be possible otherwise and could never be done on our own if we did not explore a partnership. This speaks to the conversation around partnerships and relationships, and the breadth and scope of services, as well as looking at how to strategically enhance that. Goal #10: Governance (Slide 12): Regarding what is going into the RFP that speaks to the idea of joint ventures, hospital contracts, radiology, etc. and what it means, Mr. Gizdic said this can be included with maintaining local control/decision making on hospital-based provider contracts. This is key to any partnership and the relationship to providers and healthcare is local. It would be asked for and clearly covered in the RFP. It is important that NHRMC maintains those relationships as well as hold them accountable to perform. This can be included in this section or in the provider section. Regarding the non -compete waivers that are currently in existence and if they would continue, Mr. Gizdic said typically it will matter if it is an acquisition, which is the extreme end of the spectrum. Anything else would not impact that. The way it would usually occur is that those contracts would get assumed as part of the relationship. For example, if there is a three-year contract and there are two years left on it, it just rolls into the deal, unless it is negotiated otherwise. It can be addressed in the RFP and in due diligence. Again, it is only an issue if it is at the far end of the spectrum. Regarding where patient costs would be addressed, Mr. Gizdic stated that would be covered under Goal #2 of Value. Mr. Gizdic stated that other parts of Goal #10 include things such as local control. The community has spoken out about wanting to maintain local control. He thinks the comment that was added "develop independent governance and oversight with local control" speaks to this, which is looking at what does local control mean and what type of local control is being talked about. There is a Board of Trustees (BOT), which is local control. Maintaining a majority or more of the board locally appointed would be maintaining local control. Currently the BOT, because the County owns the hospital, is fully appointed by the County Commissioners. The question to be considered is would it be an independently appointed local governance, a politically appointed local governance, or some combination thereof. He thinks several points that need to be vetted throughout the RFP and throughout these discussions, is if there is any kind of governance impact to the relationships that are proposed, is how they address all of these things as part of the PAG's exploration after the RFP goes out and discuss remaining independent and the current situation. In the First Tryon report, the issue around governance and how the appointment process works was part of the study. Regardless of whether a partnership is pursued or not, there will be a need to explore it. A brief discussion was held about a responder wanting to know upfront if the intent of the hospital is to be independent and freestanding, somehow still controlled by the state/county, or has some other restrictions. Mr. Gizdic stated he would agree with the discussion and is not sure the answer will be available upfront. It needs to be understood that through the exploration process there could be proposals that are different than the way governance is done now and that would all be part of the consideration and potentially could be a recommendation from the PAG on governance structures and appointment processes. The "why" will also have to be included in the recommendation. Mr. Burik stated that this RFP is different than an RFP to get a new backhoe or car. In a very real sense, this RFP will ask a lot of specific questions and the responders are going to provide answers that will be largely based on their experience and they will have to project what they are willing to invest in this organization if governance does not change and what they are willing to invest if governance or membership changes. The purpose is not to try to define that, but rather to get the responders to state it. This will allow for the exploration of the opportunities provided to it by the responder rather than the PAG saying it is only this or only that. Further discussion was held about possibly stating and advocating for what is wanted for governance. Mr. Burik stated the strategic plan states what the organization wants and does not have a projection of governance. Mr. Gizdic stated as a point of clarification, ultimately he thinks it should be and will be stated but not before the RFP goes out. He thinks the process is to learn all the ideas and approaches from a responder. While the RFP is out the PAG is going to explore the current situation, the First Tryon report, and pros and cons of the current structure and employment process, etc., which could lead to the PAG saying it thinks that needs to change or not. When the responses come in, there will be different ideas around governance and both the PAG comments and responses can be put together to determine the type of governance model and structure the PAG thinks is the best and makes the most sense. If this process reached the point of a recommendation of moving forward, it would be included. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 5 A brief discussion was held about the makeup of the NHRMC Board of Trustees. Member Eckel stated he thinks the members being appointed by the County Commissioners is a flawed part of the system. It is a highly functioning board and has just come off the best financial year ever, but it is still a flawed system in his personal opinion. In determining what the PAG would want, he would ask Mr. Burik to report back before the RFP goes out on how other boards self -appoint. He thinks there is some sort of hybrid where the County Commissioners remain involved in the appointment process and there be a hospital internal appointment process. There are needs for certain skill sets on the Board of Trustees, which have been voiced to the County Commissioners and the needs do not always get fulfilled. Member Thompson stated the Board of Trustees performs an exhaustive evaluation and interview process of potential members and gives the recommendations to the County Commissioners. The County Commissioners may or may not take the recommendations when appointing members. As to other comments (slide 13) in the development of the goals and objectives in regard to the half million dollars of free care and if there is a plan to reduce it, Mr. Gizdic stated it is a half million dollars of free care each day. It is driven by social determinants such as poverty and free care, i.e. charity care, is predominantly because someone is not able to afford or have access to insurance. The plan is not easy to articulate and is about how do we work to keep people out of the healthcare system, how to keep them healthier, how do we work with them to address the social determinants, and how do we get them to a more appropriate setting of care than the emergency department. The emergency department is the most expensive place to get care. To him the comment raised is part of the health equity discussion and the need to learn what other healthcare systems are doing to address social determinants. The answer is not to address it by eliminating free care. The answer is how to keep people healthier in the community and most likely in the health equity section, understanding what a responder has done, been successful at, what impact it has had in their community, and how they can help NHRMC accelerate all the efforts this community is trying to deploy around social determinants and health equity. In response to questions, Mr. Gizdic stated that free care includes underinsured and no insurance. Approximately ten percent are insured people. A lot of people who signed up for the insurance exchange picked the lowest cost premium and did not realize there would be a $10,000 deductible. The first time someone with this insurance comes to the hospital, they are responsible for the first $10,000. It is also seen in the medical practices. NHRMC does not go after someone's home or car, it is written off as bad debt. Members expressed a desire to not only see a responder's philosophy on collection, but also their philosophy on free care as this will say a lot about how they conduct their business. DEVELOPMENT OF GOALS AND OBJECTIVES: REVIEW OF UPDATES TO GOALS 1 THROUGH 5 (SLIDES 15-19) Mr. Burik stated this portion of the meeting will be working towards the specificity in the RFP of Goals 1 through 5 and rather than go through each objective under the goals, he will provide the design that is at work for each goal. For Goal #1, Improving Access to Care and Wellness Programs, there are several vectors of access that specific questions are being asked. The first of which is an issue of some urgency in that as Wilmington has grown, it has grown in population and physically. At the same time, what was once inpatient is now outpatient. There is a lot of planning being done for how the health system becomes more ambulatory so the first vector of access is ambulatory which includes retail, etc. The other vectors being asked about are primary care, home care, elderly, workplace, digital and telehealth (which are being separated out), and inside the hospital. An example of the inside the hospital vector is how patients are moved more efficiently so they are not in the observation unit in the emergency department waiting for a bed in the ICU to open up. There is a need to get specific questions so these vectors are seen in the form of questions in the draft RFP. The expectation is for the responders to provide their information on how they handle access. Member Hall stated for the objective of "Improve access for service lines in need of further development, including women's services and geriatric services," neonatal and pediatrics are part of the access as they cannot speak for themselves. Mr. Burik stated he will make sure it is included and some special thought will need to be given to pediatrics. Pediatrics, particularly subspecialty pediatrics in the neonatal intensive care units (NICU) around the country, is an issue right now that is challenging, so work will need to be done to figure out how to specifically address it in the RFP. Mr. Burik stated that Goal #2, Advancing the Value of Care, is more difficult but for different reasons. As a preface to reviewing the vectors, he noted that some articles on the PAG website and some of the conversations held have been about the impact of collaboration on the cost of care. The NC State Treasurer recently cast some shade on the potential Wake Forest —Atrium merger. Mr. Burik thinks, as he reads it, it was possibly just because it was a merger and the question being how could two big organizations coming together be good for the cost of care. It is not an unusual perspective in regulatory circles right now. Consolidation of health systems has occurred around the country for a long time, but in North Carolina consolidations have almost always been in-state consolidations and regulators have noticed it. Not every state follows this pattern. As it relates to Goal #2, the vectors of value are quality, cost, Medicare Advantage, and also includes what do you do with health plans, HMO licenses, and care coordination, and as an organization whether you bring more value -based reimbursements into your market. He would expect that every respondent to the RFP will have a storyto tell on this and will have to demonstrate what happens to quality, price, and cost when they collaborate with another institution. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 6 In response to questions about the vectors discussed so far and if they are vectors in the industry in general or if they were drawn out based on the PAG discussion that has occurred, Mr. Burik stated it is based on the PAG discussions. The conversation from the last meeting was put into the RFP his team is working on and is based on NHRMC's strategic plan which contains the organizing principles. He felt it would be important to come to the PAG tonight with these vectors because his team is really trying to drive an RFP based on these vectors. In response to questions about what Mr. Burik has seen over the years, how has an organization done all of these things and not raised costs, Mr. Burik stated in some respects Mr. Gizdic answered the question earlier of why does NHRMC not just start its own system and asked Mr. Gizdic to restate the answer. Mr. Gizdic stated it is because NHRMC is not big enough and cannot afford it. Mr. Burik stated this requirement, the economies of skill necessary to start all of this and make the investments, makes it a lot easier for an organization such as Ascension to deal with organizations such as Google, than it is for Pender. Mr. Gizdic stated there are basically two factors that would drive costs up in this community and one would be increasing utilization. For example, Medicare is not going to pay the hospital any different no matter what it does. Medicaid is also not going to pay any different no matter what the hospital does. NHRMC can increase its own operating costs or it will just lose money because Medicare and Medicaid are 65% of the hospital's business. It doesn't change for them, their beneficiaries, and the hospital does not get reimbursed any differently. The only way to increase costs for Medicare is if the hospital had more Medicare utilization, which is contrary to everything NHRMC is doing and contrary to where the industry is going, so it does not make a lot of sense to try to all of the sudden just start churning a lot of Medicare patients through unnecessary stuff to increase costs. Also, the hospital can increase its prices all it wants but BCBS is not going to pay anymore and is not honoring large system contracts anymore. They are basically putting a stop to it. Plus, as has been discussed, more of their business is being moved to the value contracts, getting away from the fee-for-service so it is negating the cost item. What is interesting to him is it is somewhat documented that the cost of care is lower in southeastern North Carolina than it is in Raleigh or Charlotte. If you were to sign up for the exchange on BCBS and use Wilmington, Raleigh and Charlotte addresses you will find that the premium for Wilmington where the cost of care is lower than those other markets is as high or higher than the premiums available in Raleigh or Charlotte. NHRMC is not controlling it, BCBS is controlling the premiums. He thinks the historical game that has been played around costs, which is well researched and documented of being done, is over. The questions need to be asked and to make sure to get the responses back as to how health systems are going to approach this. Further discussion was held about how there are more ways to increase costs because of adding services and analytics and who pays for it. Mr. Gizdic stated that it is an increase in the operating costs. Mr. Burik stated that is the reason for the fifth vector of the ability of the potential collaborator to actually repurpose value -based reimbursements. If in fact a move is made to Medicaid managed care, there will be dollars available for social services. If the hospital is imposed to do social services without the reimbursement for it, costs go up. If the hospital is reimbursed so that it has clear incentives, new dollars to do social services, and new dollars for avoiding emergency departments (ED) stays/visits, that is where the revenue is repurposed to do these new things. The idea is to look for systems where these new services are not an additional expense but they are able to change their revenue model and be efficient in the adoption of new skills so they can deliver a better product. Mr. Gizdic stated that everyone kind of agrees all of this needs to be done for this community anyways, regardless. Those are additional operating costs to NHRMC to do them. They cannot be passed along because Medicare, Medicaid, and BCBSNC are not going to pay any more and the question becomes how can all of these things be done, add all the things that are agreed that are wanted and needed in this community, and still stay in the black and not lose money. There is a need to find a different model. A brief discussion was held about why is it not an option for the taxpayers to pay for it and why partnerships are having to be utilized. Member Thompson stated it makes sense but never passes at the electorate. Members discussed still bringing it up as one of the options because it is part of the conversation of remaining independent. Mr. Burik stated historically the ability to negotiate rates has been very highly correlated with the success of an institution. Member Thompson stated the hospital had a $19 million delta last time with BCBSNC and through negotiation was able to shrink it to a $9 million delta, but that is still a $9 million delta just for the hospital's plan. Mr. Burik stated for Goal #3, Achieving Health Equity, the vectors are what are a respondent's policies on charity services and financial collection practices and procedures, community investment, and employee training. A brief discussion was held about community investment. As it relates to the opioid crisis being partnered with behavioral health, Member Gage thinks behavioral health and mental health should be separated. The opioid crisis will end at some point, but with the decentralization of mental health care in this country, there is an enormous need. Mr. Burik stated that both will be broken out separately under community investment. Mr. Burik stated for Goal #4, Engaging Staff, the vectors are recruitment, retention, and enhancement, which are all under the mission, vision, values, and culture of NHRMC. In response to questions as it relates to developing careers and if it would be of value to ask in the RFP what methodology is used for the engagement PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 7 of local educational resources, Mr. Burik stated the question would be framed as to how deep is a responder's supply line in the communities it serves to recruit and retain employees. It will be included in the RFP. Mr. Burik stated for Goal #5, Partnering with Providers, the vectors are recruiting and advancement for physicians, medical and health education, and approach to working with all physicians in the community regardless of type. Responders will be informed that Atrium Health manages the employed physician group and that there is a need to specifically know how they would step into that, if the discussion is not with Atrium. Mr. Burik concluded the overview stating that generally speaking, his team knows NHRMC's strategic plan, has heard the dialogue held in these meetings and tried turn it into an RFP, which is how the development of these objectives and vectors were done. Members agreed that this process feels relatively complete. Co -Chair Broadhurst stated the same process will be used for Goals 6 through 10 during the next meeting to keep moving towards the deliverable of getting the specific RFP questions prepared for final consideration. RFP DRAFT QUESTIONS FOR GOALS 1 THROUGH 5 (SLIDES 21-27) Mr. Burik reminded members that the draft RFP document covering Goals 1 through 5 was included in the handouts for this meeting. He asked that the members review the document and provide comments and/or materials so his team can continue vetting the RFP. Co -Chair Broadhurst stated that the homework for the next two weeks would be to take the information from today's meeting and provide comments back for Mr. Burik and his team on what needs to be further addressed, added, etc. Co -Chair Biehner stated she thinks six members commented on Goals 6 through 10, so there is a need to have as many of the members as possible participating in this process to comment on these questions. It is very important to do so to ensure the information is reflecting everyone's concerns in this RFP. In response to questions, Mr. Coudriet stated that everything is being placed on the website. Discussion was held about how sometimes respondents to an RFP do not follow it and how that will be handled in the case of this RFP. A municipal RFP is different than a private RFP and there is a need to understand the process. Mr. Burik was asked to explain his experience with this type of issue when it does arise. Mr. Burik asked Mr. Burgett to respond. Bryan Burgett, Director with Navigant, stated he has been working on this project and has been helping to generate the materials. As to how to keep the discipline in the responses to the RFP to avoid the stream of conscious responses, Mr. Burgett stated the group as a whole will have to work through it and it will be a challenge. The directions given in the RFP is that responders have to follow the regime of the RFP. In going through the RFP, he thinks it is more important to be thorough and cover all of these topics even if some questions have some potential overlap. Respondents will be allowed to cross-reference to another question to say something along the lines of "Response was provided in question #3, see question #3." Mr. Burik stated that typically his team is able to coach respondents in the submission, but the way to accommodate that is where there are seven questions, there might be two really big answers and the others get referenced into those two. While still a little clumsy, it is the compromise that seems to work. Mr. Burgett stated in writing the RFP questions, what is being looked for is meaningful responses. He does not think the PAG wants marketing materials or canned responses because it is not going to be productive. Asking the hard questions is really what this is all about and he thinks the main thing is to ask questions that help the PAG distinguish whether a strategic partnership with another organization would be a good thing to do and if so, and if the PAG wanted to do it, which organization is actually going to be the best partner. In his experience, there will probably be a number of proposals that are not very effective and will miss the mark for various reasons. For the proposals that are considered the finalists, there will be the opportunity to ask further clarifying questions. In response to questions about how a proposal may not meet the needs but has an item the PAG likes, Mr. Burgett stated in that case the PAG could take that item, bring it to one of the finalists, and ask what they think about it. Mr. Burik stated what also is different about this RFP process is that it allows the PAG to be educated by all the organizations as it asks questions. In response to questions, Mr. Burgett stated that there are a number of other aspects of the RFP and what is being looked at today are the excerpts of the first five questions. As to quantifying and qualifying the answers received, Mr. Burgett stated the idea of ranking goals and objectives in his experience has been that oftentimes it is hard to get on the same page because everyone has some sort of their own relative point of view of what is and is not important. The things that are usually more quantifiable and provable tend to rise to the top as far as just making decisions. Working through the process is very much like a discovery process in a way and he thinks it could be figured out at a high level what is important. What will be interesting is that there might be things suggested from the responders that the PAG has not even thought of and in his experience, he would say to expect the unexpected. As to whether or not 60 days is logical to allow for a response, Mr. Burik stated he would imagine that almost every organization that responds to the RFP has a group of people dedicated to responding to RFPs. Mr. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 8 Burgett added that it will be seen which responders truly rise to the occasion so there is some merit in having a 60 -day response period. Discussion was held about the Navigant team now having the information based on today's meeting to develop the questions for six through ten and being able to provide a complete a RFP sooner than later to the PAG. Mr. Burgett stated there is a draft of the complete RFP. Mr. Burik stated that based on the conversation held during this meeting on Goals 6 through 10, his team will put the two pieces together and bring it back to the PAG at the next meeting. In response to questions about who will filterthe RFP responses to bring to the PAG, Mr. Burgett stated that the Navigant team serves the PAG and the PAG will have determine how it wants to handle processing the responses. There are various ways to do it, but one thing the team will try to do for the PAG is to summarize the answers. For example, a summary can be done of the answers to the questions from each respondent and do it in a way to allow an apple to apple comparison of the responses. Again, the team serves at the pleasure of the PAG and it will need to be directed on how the PAG wants to process the proposals. A brief discussion was held about the homework in preparation for the next meeting. Member Papagikos commented that as far as specificity and asking the hard questions to get good answers, one of the items added during a previous meeting was about clinical research. The question in the draft RFP of "If applicable, discuss how an affiliation with the Respondent would support the growth of medical research at NHRMC" seems vague and open ended. For him the specific rephrasing of it would be "If applicable, discuss the number of patients enrolled on clinical trials over last three years." He asked if that was too specific of a question to ask. Mr. Burgett stated that what is going to be seen in the document is there are not a lot of questions about the respondent themselves. What has actually been done is an outline has been given to the respondent to allow them to give a profile of their health system, so questions could be added that way. What was trying to be avoided was getting a response from the annual report language. What is desired are responses as to what a respondent has done in the past in similar situations where they have affiliated with a health system, what do they want to do here, what do they want to do with this community, and what they want to do with NHRMC for the organization. What the members have to think about is that if they were a respondent, it is easy to pull out data and the responses becoming a data dump. He does not know if that will be as useful but that said, if he were to answer that question he would probably cite the success in his organization of what has been done with others and woven it into the answer as part of the proof that the same could be done here. In response to questions, Member Eckel confirmed that he would like to see what has been crafted as the basic RFP questions for Goals 6 through 10 in conjunction with what has already been done. Co -Chair Broadhurst asked Mr. Burgett how quickly his team could get Goals 6 through 10, based on the feedback from tonight's meeting, put into the same question format as Goals 1 through 5. Mr. Burgett responded that the team has a draft of it already and only needs to consider the feedback from tonight and incorporate those into the document, which will take a couple of business days. In response to questions, Ms. Kelly stated it will be sent to the PAG before the next meeting so members can do edits on both parts at the same time. UPDATE ON RFP FOR FINANCIAL ADVISOR Ms. Wurtzbacher stated that three responses have been received to the RFP for Financial Advisor. Hammond, Hanlon, Camp LLC, Cain Brothers, and Ponder & Company responded. Mr. 011ie and she are in the process of reviewing the responses, asking follow-up questions, and performing reference checks. Her goal is to have the proposals to the PAG by December 13, 2019 to allow time for review. If it was felt it would be helpful, during the December 19th meeting, the finalists could provide a brief presentation in person or by phone, but more importantly be available to answer any questions before the final decision is made on who will be the financial advisor. In response to questions, Ms. Wurtzbacher stated the respondents are all niche companies that work on joint ventures, mergers and acquisitions, strategic partnerships, and provide the financial analysis in an advisory capacity. She confirmed that two of the specific parameters were an expertise in healthcare and expertise in healthcare in North Carolina. Discussion was held about the finalists making presentations to the PAG during the December 19th meeting. In response to questions, Ms. Wurtzbacher stated neither she nor Mr. 011ie have worked with the finalists before and they are all qualified. The general consensus of the members was for Ms. Wurtzbacher and Mr. 011ie to provide their recommendation including information about why and why not to recommend a finalist, rather than have the finalists make the PowerPoint presentations, and the response information be provided to the PAG and posted on the website. In regard to the discussion on transparency if the finalists do not present, Mr. Gizdic confirmed that all of the information will be made available to the public on the website. Ms. Kelly will send the information to the PAG prior to the next meeting so that questions or concerns can be sent back to Ms. Wurtzbacher and Mr. 011ie to be addressed prior to the next meeting. PARTNERSHIP ADVISORY GROUP DECEMBER 5, 2019 MEETING PAGE 9 OPEN DISCUSSION In response to questions about how to handle emails from the public, Co -Chair Broadhurst stated all members have access to the emails and therefore, they are the conduit from the community through the process. He thinks if members think there is information in the emails that is pertinent to the deliverable at hand, which right now is the RFP, it should be brought forward for discussion and consideration. Member Thompson stated that one of the most important items discussed tonight was the process of governance and what is going to drive the RFP and type of responses received. He thinks if the process of governance is not understood by all the members then there needs to be a quick briefing on how and why it works. The consensus nationally is that the way it is done here is the most outdated and worst process used. It is Goal #10, but it is the core of the other nine goals and if the members do not understand, then how will it be focused into the strategic plan, the core values, and all the things of the RFP. After a brief discussion, the general consensus of the members was for information to be sent ahead of time providing an overview of the current governance structure and then have a brief presentation on it at the next meeting. CLOSING REMARKS Co -Chair Biehner made closing comments and reviewed what will be covered at the December 19th meeting. ADJOURNMENT There being no further business, Co -Chair Broadhurst adjourned the meeting at 7:28 p.m. Respectfully submitted, /final -approved/ Kymberleigh G. Crowell Clerk to the Board Please note that the above minutes are not a verbatim record of the Partnership Advisory Group meeting. The handouts and PowerPoint materials associated with the December 5th meeting are included as attachments to these minutes for reference. 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Y V N a.a d vZ 4 y�j r d c � o - P d E 3 c V .0 O C 3 a 02 C =o Zcc LO M r r y �af N Y d9 y C 4 M ~ O > u a x fill 1, IL (j� 161 O Boa �°0 3 a u I co M DRAFT REQUEST FOR PROPOSAL (RFP) QUESTIONS DERIVED FROM GOALS AND OBJECTIVES 1-5 FOR CONSIDERATION BY THE PARTNERSHIP ADVISORY GROUP (PAG) PAG MEETING #4 DECEMBER 5, 2019 PLEASE NOTE: The Partnership Advisory Group Support Team leveraged the revised goals and objectives 1-5 to draft the following RFP questions for the PAG's consideration. The following draft questions are representative of questions pertaining to goals and objectives 1-5 only and are not intended to represent a complete RFP. These questions, along with questions derived from goals and objectives 6-10, questions on the Proposed Strategic Partnership Structure, and questions on the Deal Process and Transaction Timeline (as applicable to the Respondent) will comprise the Proposal Request section of the RFP. The entire Proposal Request section along with the additional RFP ections (e.g. submittal deadline and instructions) are not included in the following pages. 1. Improving Access to Care and W 1.1. Describe what, if any, impact have on NHRMC's ability to c in the communities it serves. 1.1.1. If appli expand iosed Strategic Partnership would and other outpatient access points 's position on NHRMC's current plans to atient access points in the Service Area. 1.1.2. If ap es the scope and timing of Respondent's commitment to ad ' ambula ther outpatient access points in the Service Area. 1.1.3. If appl%ible, Ocribe how Respondent and/or Respondent's strategic partnersProposed Strategic Partnership to improve ambulatory and other access oints in the communities served by Respondent and its affiliate or partner hospitals. 1.2. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on improving access to primary care services in NHRMC's Service Area. 1.2.1. If applicable, discuss your organization's approach to staffing primary care clinics, including leveraging providers with team -based care. 1.2.2. If applicable, describe how Respondent would identify and resolve any gaps in primary care coverage in the Service Area. 1.2.3. If applicable, provide examples of how Respondent improved both primary care access and operational efficacy (improved quality, improved patient satisfaction, lower cost) in communities served by Respondent and its affiliate or partner hospitals. REQUEST FOR PROPOSAL Page 2 of 8 1.3. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to further develop and enhance NHRMC's home care services within the Service Area. 1.4. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC providing care for the elderly in the Service Area. Describe any programs that could be introduced at NHRMC (e.g., PACE programs, adult day care, geriatric urgent care services). 1.5. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC aligning with employers in the Service Area to provide wellness and healthcare services to local employees (e.g., occupational health programs; walk- in occ-health services at urgent care center; health clinics located on-site at employers). 1.5.1. If applicable, discuss Respondent's position on continuing NHRMC's existing programs to align with local emplo sAtif 1.5.2. If applicable, describe the scope anespondent's commitment to expanding and improving upon NHams with local employers. 1.5.3. If applicable, provide exa of a succMful implementation of occupational health or other ased programs with employers in communities served by onden its affiliate or partner hospitals. 1.6. Describe what, if any, impact R on posed Strategic Partnership would have on NHRMC's abi ' add nt-fi7 ndly, consumer -facing programs that provide added conv nce g., 11 centers; online scheduling, other digital offerings) and that cipa ti d transition to value -based care along with increased patien a t in u standing the financial costs of healthcare (e.g., pricing trans 1.6.1. If ap able, dis ss how Respondent supports and engages patients to make inform ealt a decisions (e.g. using cost transparency tools, providing patient e , etc.). 1.6.2. If applicable, describe the scope and timing of implementing any of Respondent's initiatives at NHRMC and/or within the Service Area. 1.6.3. If applicable, provide examples of the successful implementation of such initiatives in communities served by Respondent. 1.7. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to further and enhance telehealth programs (e -visits and consults; remote specialty monitoring such as eICU) and similar digital health platforms and capabilities. 1.7.1. If applicable, discuss Respondent's strategy to receive a reasonable reimbursement for these services in order to recover the cost of investment. 1.7.2. If applicable, describe the scope and timing of implementing any of Respondent's initiatives at NHRMC and/or within the Service Area. REQUEST FOR PROPOSAL Page 3 of 8 1.8. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to establish command centers and manage inpatient referrals for advanced care. 1.8.1. If applicable, briefly discuss Respondent's experience fostering collaborative relationship that enable the establishment of regional and national systems. 1.8.2. If applicable, describe the scope and timing of implementing a command center at NHRMC. Note for Internal Review Purposes: A Command Center is a centralized repository of real-time data that allows an organization to continuously monitor the operations of the hospital or health system to improve efficiency and deliver optimal patient care. 2. Advancing the Value of Care DRAFT 2.1. Describe what, if any, impact Respondent's have on NHRMC's ability to maintain and controlling the cost of healthcare delivery. 2.1.1. 2.1.2. If applicable, describe Resf of -pocket costs for patients pay patients. If applicable, describe an Discuss the rationale for and objectives oJ116pr 2.1.2.1 2.1 Strategic Partnership would on high-quality care while ies to help control out- copays as well as self - or joint ventured by Respondent. �gy and how it furthers the goals on Respondent's position on continuing establish, own, and operate a Medicare Vble, describe how any health plan affiliated or partnered ondent could enhance NHRMC's efforts to lower cost and access in the Service Area. 2.1.3. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to establish and further participation in value -based provider networks (e.g., ACO and CIN) and/or value -based care initiatives. 2.1.3.1. If applicable, discuss Respondent's approach to NHRMC's existing value -based networks, including any opportunities to expand or improve upon these networks. 2.1.3.2. If applicable, describe any operational or strategic synergies that may be captured by combining Respondent's value -based networks with NHRMC affiliated or partnered networks. 2.1.4. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's capabilities in value -based care contracting models REQUEST FOR PROPOSAL Page 4 of 8 (e.g., bundles, shared savings, capitation, etc.) with commercial insurers, employers, and governmental health programs. 2.1.4.1. If applicable, discuss Respondent's outlook on the timing and materiality of future value -based arrangements. 2.1.4.2. If applicable, how could Respondent enhance NHRMC's value - based care contracting efforts? 2.1.5. If applicable, provide detail on how cost and quality were impacted at hospitals and health systems that recently affiliated or partnered with the Respondent. 2.2. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have in developing and/or enhancing NHRMC's patient satisfaction programs, including monitoring and the approach to using feedback to make improvements in the patient experience. 2.2.1. If applicable, discuss how Respondent satisfaction. Describe specific progr9 implement at NHRMC. i 2.2.2. If applicable, provide detail o systems that recently affiliated record of patient satisfac ' n s and the record of pa Respondent. ielp NHRMC enhance patient plans that Respondent would ,itisfactid)♦for hospitals and health ;d with the Respondent. Include the to any affiliation with Respondent, 1 following the affiliation with 2.3. Describe what, if an pa espTudent's Proposed Strategic Partnership would have in developing or ing w NHRMC coordinates patients within the continuum of care bo in tem (e.g., using patient care coordinators) and outside the s specialty providers, post -acute care providers). 2.3.1. If a able, de*be any planned initiatives or plans by the Respondent that W( wuld rove lent coordination in the communities it serves. 2.3.2. If applicabW,, describe any enhancements to patient coordination that Respondent can introduce to NHRMC. 3. Achieving Health Equity DRAFT 3.1. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to maintain and enhance charity care and financial assistance policies in the communities it serves. 3.1.1. If applicable, is the Respondent committed to maintaining NHRMC's charity care and financial assistance policies? 3.1.2. If applicable, explain the process of how Respondent would modify NHRMC's charity care and financial assistance policies. 3.1.3. If applicable, provide detail on how charity care and financial assistance was impacted at hospitals and health systems that recently affiliated or partnered REQUEST FOR PROPOSAL Page 5 of 8 with the Respondent. Describe any changes to policies as well as any changes to the dollar amounts of care/assistance provided. 3.2. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's ability to maintain and enhance community outreach programs, including health education, free health screenings, wellness programs, and other community health programs, as well as general engagement in a community as a contributing "corporate citizen" in the Service Area. 3.2.1. If applicable, specifically, also discuss how Respondent works with local departments of health in addressing the health needs of communities. Detail any current or future population health initiatives done in conjunction with municipalities aimed at addressing health issues (e.g., social determinates of health; opioid epidemic; access to behavioral health services). 3.2.2. If applicable, is the Respondent committed to expanding NHRMC's programs and financial outlays for community outreacj&and engagement? 3.2.3. If applicable, discuss any enhanceme HRMC's levels of community outreach and engagement in the Se Area , new programs; leveraging programs proven successful in r markets t the Respondent could introduce. 3.2.4. If applicable, discuss t roces how the Respondent would make changes to NHRMC coV%&-OuALh and engagement programs. How would such decisions be e? 3.2.5. If applicable vide etail the Respondent's approach to and previous success withIbmactijdUacial Verminants of health. 3.3. Describe wha i t Respondent's Proposed Strategic Partnership would have on N C's ab* to .p employees with the knowledge and training needed to supporthe equity . unconscious bias training). 4. Engaging Staff DRA 4.1. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's capabilities in building and maintaining a high -performing employee team, specifically those programs related to (i) employee recruitment (including addressing critical shortage areas such as nursing), (ii) retention (e.g., engagement programs; structuring incentive compensation and employee benefits), and (iii) career development (management and clinician training; health education programs). 4.1.1. If applicable, discuss how Respondent would enhance NHRMC's efforts relative to employee recruitment, retention, and career development. 4.1.2. If applicable, how would Respondent plan to minimize the potential for employee disruption and turnover in any transition of NHRMC into Respondent's organization? REQUEST FOR PROPOSAL Page 6 of 8 4.1.3. If applicable, provide detail on how employee recruitment, retention, and career development was impacted at hospitals and health systems that recently affiliated or partnered with the Respondent. 4.2. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on the retention of existing NHRMC employees. 4.2.1. If applicable, will the Respondent make a commitment not to make any material changes to NHRMC's employee base without the approval of the NHRMC Board? 4.2.2. If applicable, please describe the Respondent's plans related to maintaining salaries, accrued benefits for length of service, and for the employees of NHRMC. 4.2.3. If applicable, provide a comparison of the employee benefit programs offered by Respondent's organization and those of I�RMC. 4.3. Describe what, if any, impact Respondent's have on enhanced employment in the commy 4.3.1. If applicable, would the Res] certain corporate services for 4.3.2. If applicable, provide hospitals and health sy Strategic Partnership would iich NHRMC operates. a com!Wtment to explore basing m in the Service Area? al employment was impacted at or partnered with the Respondent. 4.4. Describe what, if anyFresperliELthe a espl ent's Proposed Strategic Partnership would have on furthering iWsion, vision, values and culture of NHRMC. 4.4.1. If app„j0Nsimilarities that the Respondent sees between the Re dent's tion and NHRMC's mission, vision, values and 4.4.2. If applic3ftsFide detail on how organizational mission, vision, values and culture wer eserved at hospitals and health systems that recently affiliated or partnered with the Respondent. 4.5. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's commitment to being an inclusive organization, supporting anti- discrimination efforts, and building and maintaining a diverse workforce. 4.5.1. If applicable, is the Respondent committed to continuing NHRMC's inclusion, anti -discrimination, and diversity programs? 4.5.2. If applicable, describe any enhancements to NHRMC's inclusion, anti- discrimination, and diversity programs that could be introduced by the Respondent based on its experience in running similar programs for its affiliated or partnered hospitals and health systems. 5. Partnering with Providers DRAFT REQUEST FOR PROPOSAL Page 7 of 8 5.1. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's capabilities in recruiting physicians into the Service Area. 5.1.1. If applicable, specifically, discuss how the Respondent would work with NHRMC's existing physician recruitment staff. 5.1.2. If applicable, what enhancements and improvements to physician recruiting would Respondent commit to making for NHRMC? 5.1.3. If applicable, provide detail on how physician recruitment was improved at hospitals and health systems that affiliated or partnered with the Respondent. 5.1.4. If applicable, discuss how an affiliation with the Respondent would enhance recruitment and retention of or access to specialists and sub -specialists not currently available in the region. 5.2. Describe what, if any, impact Respondent's Propo d Strategic Partnership would have on maintaining and enhancing NHRMC's ical education, residency, and fellowship programs. 5.2.1. If applicable, discuss how an aff ' on with espondent would impact existing medical education pr s a NHRM ncluding the affiliation with UNC. Does the Responden to maintaining all of these programs unless otherwise decidedkv the N C Board? 5.2.2. If applicable, will the residency progr and Obstetrics 5.2.3. If applicable, 5.2.4. pro i to continuing NHRMC's existing General Surgery, Family Medicine [ie'-11amrondent offer additional medical education be implemented at NHRMC? If so, what are those Wd Respondent evaluate their feasibility? how an affiliation with the Respondent would support shim and medical education at NHRMC. 5.2.5. If applicable, discuss how an affiliation with the Respondent would support the growth of medical research at NHRMC. 5.3. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's approach to working with community physicians. 5.3.1. If applicable, describe any programs offered by the Respondent that could be rolled -out at NHRMC in order to more closely align with and support independent physicians and medical groups. 5.3.2. If applicable, what is the Respondent's approach to partnering with independent physicians and medical groups in joint ventures and clinically - integrated programs? REQUEST FOR PROPOSAL Page 8 of 8 5.4. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on NHRMC's approach towards medical group practice operations for its employed physician base. 5.4.1. If applicable, what does the Respondent suggest relative to NHRMC's medical group relationship with Atrium Health? 5.4.2. If applicable, what enhancements to medical group operations could Respondent offer to NHRMC? 5.5. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on local medical staff governance at NHRMC. 5.6. Describe what, if any, impact Respondent's Proposed Strategic Partnership would have on physician retention at NHRMC by discussing: 5.6.1. If applicable, medical education and by the Respondent's system. 5.6.2. If applicable, programs to physician burnout. 5.6.3. If applicable, programs to trai leadership. 5.6.4. If applicable, ret Re finally, for physicians offered satisfaction and to prevent executives and further physician Vent's experience with physician that affiliated or partnered with the NEW HANOVER COUNTY AND NEW HANOVER REGIONAL MEDICAL CENTER REQUEST FOR PROPOSAL FOR FINANCIAL ADVISOR BCISHEO� New Hanover Regional Medical Center REQUEST FOR PROPOSAL FOR A FINANCIAL ADVISOR FOR NEW HANOVER COUNTY AND NEW HANOVER REGIONAL MEDICAL CENTER INTRODUCTION New Hanover Regional Medical Center ("NHRMC") is a public nonprofit corporation providing healthcare services to residents of southeastern North Carolina and a component unit of New Hanover County, North Carolina ("County") for financial reporting purposes. The New Hanover County Board of Commissioners appoint the trustees of NHRMC and lease facilities to NHRMC to operate the health system. NHRMC is comprised of a network of hospitals, outpatient centers, emergency services, physicians and other providers in southeastern North Carolina and is the nation's third largest county - owned system. BACKGROUND It is important that the community have long-term access to high-quality and affordable healthcare services. With a rapidly changing and challenging healthcare environment, the County Board of Commissioners believes it is essential to look at the current NHRMC organization model and other models to determine what model will best serve the needs of the community well into the future—to evaluate if it should remain a stand-alone health system or change moving forward. As such, the County Board of Commissioners approved a resolution of intent to sell on September 16, 2019 so that it can issue a Request for Proposals ("RFP") to solicit responses from third parties and consider various options of partnerships and/or restructuring, including and up to a potential sale of NHRMC. Please see the attached Charter of the Partnership Advisory Group ("PAG"), a joint subcommittee of the NHRMC and County Boards, for further background in this matter. As a part of its work in this matter, the County and NHRMC are seeking proposals from healthcare financial advisors—with established expertise in healthcare partnership options, including but not limited to management relationships, strategic partnerships, corporate restructuring, sales, mergers or acquisitions—to provide financial analyses and advice on select responses to the RFP, and related follow up work (the "Financial Advisor"). The County and NHRMC seek a Financial Advisor with extensive and relevant experience in line with the current and evolving state of the healthcare industry. SCOPE OF SERVICES The services provided to the County and NHRMC by the Financial Advisor may include a combination of the following: 1. Development of the Request for Proposals – During the development of the request for proposal, the Financial Advisor may be asked to review specific finance -related RFP questions and provide input on requested data elements and structure to ensure adequate information is included in the response to the RFP to allow for a comprehensive financial review. 2. Review of Current State/Status Quo/Internal Restructuring Impact –The Financial Advisor may be requested to provide an analysis and projections of the current state. This could include 2 consideration of an internal corporate restructuring, such as adding a parent company over NHRMC.. The Financial Advisor also may be asked to identify any funding gap and related financing strategy with respect to NHRMC's strategic planning in connection with NHRMC continuing as a stand-alone health system (with and without internal corporate restructuring). Review of Respondents — Whether respondent(s) are proposing a management relationship, merger, consolidation, sale or other form of affiliation, the Financial Advisor may be asked for a comparative analysis of re -financing options or other synergies that may be realized for one or more RFP responses. The Financial Advisor may also be requested to provide a review of the financial health of one or more of the respondents to ensure they have the financial capacity to support their proposal and the potential long-term sustainability of providing quality and cost- efficient healthcare services, and related population health management services, to the community. 4. Fairness Opinion Market Value Evaluation — For any proposals that include a sale or other distribution of all or part of NHRMC and/or County assets, the Financial Advisor will be asked to complete an evaluation of the associated fair market and to deliver a Fairness Opinion as may be required by the State Attorney General's Office. 5. Comparative Analysis — Responses to the RFP may reflect different value propositions. We may require a Financial Advisor to evaluate and advise on the differences between or among two or more proposals selected for comparison and further due diligence. 6. Assistance with Due Diligence — In the event the parties ultimately decide to proceed with one or a combination of proposals, we may require the Financial Advisor to assist in certain due diligence and deliver a report that will assist the County and NHRMC in their negotiations. The general role of the Financial Advisor will be to: Serve as the Financial Advisor, specializing in healthcare strategy and consulting services, in connection with the RFP process and any resulting internal restructuring and/or transaction(s). 2. Provide independent financial healthcare consulting advice and serve the interests of NHRMC and the County and not the interests of any responding party to the RFP. 3. Together with the Chief Financial Officer of each of NHRMC and the County, manage any financing components of any internal restructuring and/or resulting transaction, and provide guidance in negotiating key business/financial terms and conditions as requested. 4. Make presentations to the PAG, as requested, regarding the various scope of services delivered by the Financial Advisor. 5. Be a part of the PAG Support Team (as defined in Article IX of the PAG Charter), delivering information and reports to the PAG as requested, and also report to the CFOs of each of the County and NHRMC. PROPOSAL REQUIREMENTS In order to simplify the evaluation process and obtain the maximum degree of comparison, the County and NHRMC are requiring all proposals to be submitted in the format and manner prescribed in this section. The proposal should provide a straightforward, concise description of the proposed delivery of services and your ability to achieve the same. Emphasis should be on completeness and clarity. Please avoid the use of unnecessarily elaborate brochures, artwork or other presentations beyond that sufficient to present a complete and effective proposal. A. Title Page The proposal should identify the subject, the name of the respondent, address, telephone number, fax number, e-mail address, name and title of the contact person, and date of submission. The response should confirm that the proposal is effective for ninety (90) days from the date submitted. B. Table of Contents Include a clear identification of the material by section and page number. C. Letter of Transmittal The letter of transmittal should summarize the following information: 1. A brief understanding of the services to be performed. 2. A positive commitment to perform the services as specified. 3. The name(s) of the person(s) authorized to represent the proposer, their title, address, telephone number and e-mail address if different from the individual who signs the transmittal letter. 4. Specific assurance that (i) the organization and each individual staff member assigned to the engagement are free from personal or professional conflicts of interest in this matter, that each will update the County and NHRMC regarding conflicts of interest as third -parties respond to the RFP, and (ii) the firm is organizationally independent from the County, NHRMC and shall maintain an independent attitude and appearance from all third parties responding to the RFP. Failure to include such assurance will result in the response being rejected. D. Evidence of Insurance Include either a description of proposer's insurance or a certificate of insurance outlining proposer's insurance policies which evidence compliance with the requirements contained herein. 4 E. Approach to Providing Financial Advisory Services Outline the steps in advising in each of the core scope of services that may be needed, indicating the technical support services you have available and how would you utilize them in the evaluations and other services described above. Describe in detail your firm's experience in healthcare affiliations (the spectrum), focusing in particular on value -based care delivery, population health management systems, innovative access -to -care programs and other more timely and current -state healthcare industry considerations. F. Qualifications 1. Provide a general profile of your firm. Describe your firm's organization and how its resources will be put to work for the County and NHRMC. Demonstrate your experience working with hospitals, healthcare systems and municipal governments, particularly in North Carolina or the southeastern United States. 2. Identify the financing team and any other key personnel who would be involved in this project. The people identified as this team will be the ones allowed to participate in the event the team is invited to an interview. 3. Include an affirmative statement that your firm and all assigned key staff is properly licensed to practice in the State of North Carolina, as applicable. 4. Provide a brief resume for each person listing education, training, and specific qualifications applicable to experience in similar financial advisor relationships. 5. Identify the one firm member with whom the County and NHRMC would have the most contact on a day-to-day basis, as well as a backup firm member who would maintain familiarity with the RFP process and will fill in when the primary contact is unavailable. G. References Provide the name, address and telephone number of three to five healthcare system clients for whom services similar to those described in this Request for Proposal have been performed (public hospital experience preferred). H. Disclosure The Financial Advisor will disclose any professional or personal financial interest, which could be a possible conflict of interest in representing NHRMC and the County. The Financial Advisor shall further disclose arrangements to derive additional compensation from various investment and reinvestment products, including financial contracts. I. Fees Given that NHRMC and the County do not have a set or definitive proposal to assess or work through, we are unable to request pricing out this engagement as a flat fee on the front end. For that reason, we are asking Financial Advisors to propose an hourly rate for their services, broken down by consultant and reflective of a material discount recognizing the potentially larger scope of this engagement, that NHRMC is a public hospital, and that the rest of the PAG Support Team is providing discounted hourly rates. As the County and NHRMC are better able to define the scope of specific projects and deliverables related to this matter, they will then ask that the Financial Advisor work collaboratively to establish individual project budgets with a not -to -exceed number, and proactively communicate regarding corresponding monthly budget estimates. PROPOSAL SUBMISSION Three (3) copies of the completed proposal must be submitted in writing to: New Hanover County, with a copy to NHRMC, as follows: New Hanover County Attn: Lena Butler 230 Government Center Drive Suite 165 Wilmington, NC 28403 All proposals must be received by 5:00 p.m., December 2, 2019. Proposals received after that date and time will be rejected. Proposals may be requested and posted as part of the public record, but we are able to redact any information deemed confidential. SELECTION PROCESS Proposals will be evaluated based upon, but not limited to, related experience of the respondents, knowledge of the healthcare industry, professional qualifications of individuals to be assigned to the project, fees, and overall proposal content. The financing teams for the County and NHRMC will review all proposals, conduct interviews as necessary, and make final recommendations to the PAG. Such group will then select the Financial Advisor. It may require further interviewing as part of that selection. G This request for proposals does not commit the County or NHRMC to award a contract, to pay any costs incurred in the preparation of a response to this request or to procure or contract for services or supplies. The County and NHRMC reserve the right to accept or reject any or all proposals received as a result of this request, to waive minor informalities and irregularities in any proposal reviewed, to negotiate with any qualified source, or to cancel in part or in its entirety, this request for proposals, if it is in the best interest of County and NHRMC to do so. No official or employee of the County or NHRMC, and no member of the PAG, shall have any financial interest, either direct or indirect, in the contract. No such official, employee or member shall exercise any undue influence in the awarding of any contract resulting from this request for proposals. QUESTIONS Should you have any questions, please contact Lisa Wurtzbacher at 910-798-7187 or email at lwurtzbacher@nhcgov.com. 7