2020-06-18 PAG FinalPARTNERSHIP ADVISORY GROUP
JUNE 18, 2020 MEETING PAGE 1
ASSEMBLY
The Partnership Advisory Group met to hold a meeting on Thursday, June 18, 2020, at 5:30 p.m. in the
Burney Center at UNC -Wilmington, 601 South College Road, Wilmington, North Carolina.
Members present via roll call: Co -Chair Barbara Biehner; Co -Chair Spence Broadhurst; Vice Co -Chair Bill
Cameron; Vice Co -Chair Dr. Joseph Pino; Members: Dr. Virginia Adams; Evelyn Bryant; Chris Coudriet; Cedric
Dickerson; Brian Eckel; Jack Fuller; Hannah Gage; John Gizdic; Tony McGhee; Dr. Michael Papagikos; Dr. Mary Rudyk;
Dr. Rob Shakar; Jason Thompson; Meade Van Pelt; and David Williams.
Members participating via teleconference via roll call: Robert Campbell and Dr. Sandra Hall.
Staff present via roll call: County Attorney Wanda Copley; Clerk to the Board Kymberleigh G. Crowell;
Assistant County Manager Tufanna Bradley; Chief Financial Officer Lisa Wurtzbacher; Chief Communications Officer
Jessica Loeper; Budget Officer Sheryl Kelly; Intergovernmental Affairs Coordinator Tim Buckland; New Hanover
Regional Medical Center (NHRMC) Director of Marketing and Public Relations Carolyn Fisher; NHRMC Chief Legal
Officer Lynn Gordon; NHRMC Chief Strategy Officer Kristy Hubard; NHRMC Executive Vice -President and Chief
Financial Officer Ed 011ie; Joseph Kahn, Shareholder with Hall Render and outside counsel for NHRMC; David Burik,
Managing Director with Guidehouse; Greg Van Alstyne, Senior Strategy Consultant with Guidehouse; Eb LeMaster,
Managing Director with Ponder & Company; and Robert Jaeger, Vice President with Ponder & Company.
Co -Chair Broadhurst called the meeting to order and thanked Chancellor Sartarelli, Mark Lanier, and all the
staff at UNCW for providing this outstanding venue. It put the PAG in a position to come back together, face to face,
and it is most appreciated. There will be an open session and when the meeting moves into closed session, the public
in the audience will move to a different place and the virtual access will have a placeholder that just says "Closed
Session Portion" and no audio. The public will be welcomed back both in-person and virtually when the meeting
moves back into open session. The closed session will take approximately 90 minutes. This meeting is being held as
a permissible combination of an in-person and virtual meeting with the public access to open session components
in accordance with state law. As with all other meetings the public can hear the open session portions of the meeting.
It is not participating in the meeting discussion. There will be no questions from the public during this forum. As a
reminder to the public, the public hearing regarding the partnership proposals received by NHRMC and the County,
will be held by the County Commissioners on Monday, June 22"d at the New Hanover County Historic Courthouse,
24 North Third Street, Room 301 starting at 5:00 p.m. All members of the public are welcome to attend the meeting.
CONSIDERATION OF PURSUING A PARTNERSHIP VERSUS STATUS QUO OR RESTRUCTURING
Co -Chair Biehner stated that open session will be spent discussing pursuing a partnership versus status quo
versus restructuring. These have been discussed at different points over the last several months and this is the
opportunity to go through all that has been learned and processed during this time. She then reviewed slide 5 of
who are the PAG members and what was covered during the 14 meetings. She also noted that the members have
had a lot of opportunity to explore on their own, as well as through information provided to them, and then in the
meetings themselves. The five workgroups that the PAG split into assessed the different areas that were the key
areas of interest and concern. There have been public presentations by the respondents to the PAG, 12 site visits
with the respondents to understand fit and conduct due diligence, and a lot of time listening to the community,
NHRMC employees, and providers.
In review of slide 6, Co -Chair Biehner provided an overview of the process that goes back to 2017 with the
development of NHRMC's current strategic plan. It looked at the key things the PAG keeps talking about: access,
value, and health equity. In 2018, the NHRMC Board of Trustees (NHRMC BOT) realized in looking at how to move
the strategic plan forward, it had significant structural and financial barriers and began looking at SystemCo
restructuring in an effort to then meet those concerns. NHRMC has committed itself to the lean process to do its
evaluations and strategic planning and it was even included in this as the facilitators asked the NHRMC BOT what
factors may inhibit the NHRMC's ability to carry out, as well as enhance and sustain its mission. After fully vetting
the option, in 2019 NHRMC BOT determined that SystemCo restructuring had some value but it was limited, and
began the partnership discussions, worked with the County Commissioners, and the PAG was established and started
in October 2019. The work has involved understanding the current state of NHRMC and healthcare industry
transformation, developing comprehensive goals and objectives and issuing the request for proposal (RFP);
evaluating the NHRMC strategic outlook including the impact of SystemCo; looking at the proposals, evaluating the
value to NHRMC and the community, and evaluating staying status quo or going with SystemCo and then looking at
those against a partnership.
In review of slide 7, Co -Chair Broadhurst stated the PAG spent a great deal of time of understanding the
current state of NHRMC and southeastern North Carolina and the areas served. The right hand side of the slide
shows the projected population growth, what's happening in this area, the large percentages in some of the counties
that are served, and that NHRMC's in-patient capacity is less than 10%. He thinks for the PAG, but most certainly for
the community members who have not been as directly involved as the NHRMC BOT and physicians, he found this
section of the PAG's work to be incredibly important and informative. Discussions have been held about industry
trends, what is going on, changes in the landscape of the reimbursements and how that will affect the finances of
NHRMC, the shifts in care delivery, and how the community served can have access to care and what the real
challenges were there. The PAG then heard about challenges specific to this market, the growth of the population,
and how the growth is fueling demand for health services and certainly straining the capacity of the main campus.
The next step as shown on slide 8, was for the PAG to discuss where it wanted to go, what were the goals
and objectives, and how to get there. The PAG stayed with the strategic plan mentioned earlier as its foundation
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JUNE 18, 2020 MEETING PAGE 2
and guide. It was a goal of this process to better position NHRMC to achieve its strategic plan and from there, work
was done towards guiding principles that serve as the framework of desired outcomes and framework to guide its
partnership exploration. From that point, work was done on goals and objectives in terms of what as a medical
center is NHRMC trying to achieve, what is the PAG's responsibility, and what is it trying to achieve in this process.
That work led to creating a framework for the PAG's request for proposal (RFP) and it was very detailed and many
meetings were held to translate the goals and objectives into questions to get to a very granular detailed point for
incorporation into the RFP.
Co -Chair Broadhurst then reviewed slide 9 noting that while the RFP was out, the PAG started looking more
in-depth at the strategic outlook factors, looking at what NHRMC was able to achieve on its own, what barriers are
still there that kept it from being able to improve access to quality and health equity, and in looking at the
organizational structures discussions were held about best practices for governance, and understanding the
challenges with the current governance structure. During this time an independent financial advisor, Ponder and
Company, was hired to help the PAG with evaluate the financial projections. After a very deep analysis, Ponder and
Company advised that NHRMC could not adjust to changes in the market and grow at the pace required for the
community without serious financial risk. The PAG then looked at alternative structures and as a reminder, NHRMC
has not historically relied on any tax funding over the past 53 years from New Hanover County. However, in laying
out the strategic plan next to the financials there is a big gap. Discussions were held about how to internally fill the
gap and it was learned that there are limited options. NHRMC's borrowing capacity would solve a few things, but
not very many and it did not go very far and would only make a small dent in the strategic plan. The financial factors
that could impact NHRMC were also looked at and discussions were held about the revenues of the hospital which
are pretty well dictated by the outside reimbursement agencies Medicare, Medicaid, and the insurance companies
and how there's not much room to move there. One alternative that was looked at was what would it look like to
the taxpayers and it was learned that a couple of the avenues being looked at were pretty dramatic. One would
require an approximately 21% increase, at a minimum, in property taxes. Co -Chair Broadhurst noted that as
someone who has sat in an elected seat before, he is not going to be the one to recommend that. There was a lot of
good discussion during this time working through the structure and talking about alternatives. He then asked Mr.
Kahn to review slide 10 about the next steps that were taken to explore what the options in terms of how standalone,
joint venture, and full integration look.
Mr. Kahn, in review of slide 10, stated that the PAG spent time at prior meetings working through the
spectrum of affiliation from a management services agreement to a joint venture to full integration. That was teased
out further as to what would each one look like perhaps with either status quo or SystemCo or some combination
thereof. Much time was spent discussingjoint ventures, and there was an intentionality to that. One of the concerns
that was expressed was the need to maintain local control in the community. The idea was that a joint venture was
an option that was on the table for consideration that might allow for the achievement of that goal of retaining an
element of local control post transaction. It was included and quite a bit of time was spent on that transaction model
during the PAG meetings. Part of that was a hedge, because it was unknown what kind of proposals would be
received. He thinks it was Pastor Campbell who asked "...are we asking for too much, are we swinging a little too
hard here..." and frankly, while the support team didn't believe that was the case, it was unknown what kind of
proposals would be received. It ended up that what was received were proposals that leaned heavily toward full
integration, but included a number of features that are not typical of full integration models, and the support team
was clearly intentional in terms of responding to some of the priorities that the PAG expressed in earlier meetings.
As one walks through the pros and cons on slide 10, it starts to be teased out that the full integration models received
checked a number of the boxes in the pro column that were thought to be attainable in just a joint venture on its
own. A number of the boxes in the cons column were relatively similar, and there weren't too many distinguishing
features that would otherwise weigh in favor of the joint venture. To explain further, there were three real elements
that played through as a theme in almost all of the proposals received that discuss full integration, and that was
significant capital commitments toward the strategic plan in excess of anything many in the group would have
dreamed of or anticipated being put on the table. What was offered by a number of the respondents were
commitments that would expand existing infrastructure, support existing infrastructure, and expand infrastructure
to allow for the robust achievement and full achievement of the hospital's strategic plan. That was benefit number
one put on the table in the full integration. Proposals were also received that included the retention of a local board
that was delegated real authority. These boards, as they were described in the proposals, were far from the advisory
boards typically seen in a full integration model. These were boards that are made up of local community members
and boards that would be invested with true authority for the governance of the operations of the hospital. And
finally, a number of the proposals included appointments from the local community to the parent system board.
This is even more unusual in a full integration model, but would allow for this community to have a voice and a seat
at the table at the parent system level when some of the larger system wide strategic decisions are being made. You
could call it a trifecta that was put on the table as part of the full integration model. It not only checked all the boxes
that were being hedged against through the joint venture model, but far exceeded that. The capital commitments
that you get in a full integration model are so far beyond what would be available or achievable in a joint venture.
Coupling that with the local control and with the ability to appoint directors at the parent system level really seemed
to tip the scales heavily in favor of the full integration model as compared to the joint venture model, which a lot of
time was spent on early in the PAG process.
Co -Chair Biehner then reviewed slides 11 and 12, explaining that the PAG then developed key proposal
elements (KPEs) based on the NHRMC strategic plan used to evaluate the proposals against each other as well as
against status quo or restructuring. The ten areas include improving access to care and wellness, advancing the value
of the care, achieving health equity, supporting our staff, partnering with providers, driving quality care through the
continuum, growing the level and scope of care, investing to ensure the long-term financial security, strategic
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JUNE 18, 2020 MEETING PAGE 3
positioning, and governance. As will be seen in the next few slides, the PAG is utilizing each of these goals and
objectives and the 18 KPEs to look at the proposals to learn to what extent they address each of the areas.
Co -Chair Biehner then reviewed slide 14 noting that during meeting 10, an overview of the KPEs was done.
The PAG looked at in an aggregate view of all of the partnerships in one and looked at that relative to SystemCo and
status quo. The partnerships were taken as a whole rather than individually and were really looked at in the
assessment of the ability to meet the strategic plan. She reviewed how the Harvey ball system was used and what
each ball meant in regards to the KPEs as shown in detail on slide 15.
Co -Chair Broadhurst reviewed slide 16 noting that the goal of the PAG was to find an objective process to
be able to compare all six proposals, status quo, and restructuring and was applied to all 18 measures. The PAG
members broke up into small groups with the KPEs being divided amongst them to perform the evaluations and
report back to the PAG as a whole on their findings. Slide 16 is a summary comparing the final three proposals which
were given a Harvey ball range of how the PAG rated the three potential partners and how the same measures were
applied to status quo and SystemCo/potential restructuring. He then asked each group to provide a brief overview
of the areas each group evaluated.
Member Williams stated his group covered KPEs 1: Expansion and Reconfiguration of Facilities, 2:
Ambulatory Network Development, 3: Information Technology, and 11: Partnerships for Highly -Specialized Services
and provided a brief overview of the group's findings. All of this information is not really related to just one county,
but the seven county region. He believes four of the counties are in double digit growth with Brunswick County being
over 20% and about 50% of the income that goes through NHRMC is from outside New Hanover County, so this is
truly a regional system.
Member Rudyk stated her group covered KPEs 5: Full -Scale Health Equity Program and 15: Integrated,
Regional Health System and provided a brief overview of the group's findings. She noted that health equity looks at
eliminating disparities in health outcomes across the region. We have a tsunami of gray in our region. 14% to 15%
of the U.S. population is over the age of 65 and it accounts actually for 40% of the people that get admitted to
NHRMC. She then provided an overview of what occurs when this population is admitted to any hospital in the
country and examples of what NHRMC would be able to do to help this population if it had a partner to be able to
provide a full-scale health equity program. As it pertains to KPE #15, she commented that we have got to stop being
hospital centric, we have got to look at different healthcare settings, and we have got to reach out into these
communities and see what does the patient want. Some of the questions that need to be asked are why does the
patient need to come to the hospital; why do we become so set on bringing the patient into the hospital instead of
reaching out and seeing what does that community want; how can we partner with what actually is in the community
as there are loads of services in the community; and why don't we address the variations in care across our
community? Above all, we have to have a trusted hospital affiliate, it's critical. She provided an overview of what
she and her team in her practice did and learned during the pandemic as it relates to long-term care and assisted
living facilities. During this time, she learned what's possible with having an integrated, regional health system in
helping our partners in different areas with what they need at the time. Member Bryant stated that because of the
time we live in, and how our community now is focused on diversity and inclusion, it is important that whomever is
partnered with, in her opinion, it is understood what are the services that they can provide when it comes to the
health equity portion. She lives in the Northside community and was grateful when the hospital partnered with her
community to do what is called the Community Health Care Assessment as it was important in understanding what
the needs of that particular community were and more possibilities are being seen when it comes to servicing our
seniors and taking care of the social determinants. She applauds what the PAG has done and the work the members
have done to understand what health equity really means. She can really see in this community how we can prosper
and have better outcomes when it comes to health equity. Co -Chair Biehner stated she would add that if one looks
at SystemCo and status quo on these particular topics and the ability to take health equity further, NHRMC needs
additional capital and the capital is needed outside of New Hanover County. It is needed in Pender, Brunswick, etc.,
so she feels it is very important to look at that. Status quo and SystemCo provide some options, but not nearly
enough of what is needed. She thinks all of the members have come to realize that health equity is critical.
Member McGhee stated his group covered KPEs 4: ACO and Health Plan Development and 10: Clinical
Transformation, and provided a brief overview of the group's findings. He noted that one of the things he thinks is
very important for the PAG in looking at this and what was discussed is what we could do with status quo, or
restructuring, and even though there were things being done already, it was never going to be able to get NHRMC
to the place that it's actually moving in the direction of value based type of care. In comparing value based care
versus fee for service type of care, it's very difficult with what NHRMC has and what it is doing right now to get to
that place. With a partner that has the clinical background, the technologies that are available, etc., it would help
NHRMC to be able to do that because it is still dealing with economies of scale. He also feels value based care is an
integral part of health equity. He also feels the important thing that his group looked at is if NHRMC is going to move
toward value based care based on what has been discussed and based on the strategic plan, then a partner is needed.
As it relates to clinical transformation, while NHRMC has a lot of bragging rights on the great things it is doing, in
order to get to the next level there is a need to have more financial strength and resources to do it. Member Fuller
stated he would reinforce what Member McGhee stated and while NHRMC is doing a wonderful job in patient care
and being patient and result focused, what attributes respondents brought to the table and shared with them were
well beyond what it was thought NHRMC could implement based on its current resources. It is impressive what a
system can do versus a local entity and he thinks it is a very positive attribute towards partnership. Vice Co -Chair
Pino stated with healthcare quality and clinical transformation, NHRMC depends a lot on data in order to make
changes, and having analytic systems that are fully developed and sophisticated will enable it to jump the curve from
where we are to where we wish to be. The other systems that they have evaluated have sophisticated systems of
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JUNE 18, 2020 MEETING PAGE 4
analytics that will enable NHRMC to move quickly in this direction. Also due to the pandemic, NHRMC had to
transition from in-person visits to virtual visits and had very little experience with. It got there but when it was seen
what other institutions were offering and could leverage over a quick/short time period, it was clear that it would
help NHRMC develop this care model much more rapidly. For these reasons and many more, it became clear that
having a partnership would help NHRMC move in expeditiously in that direction.
Member Shakar stated his group covered KPEs 6: Avoiding Staff Shortages, 7: Developing and Recruiting
Talent and Expertise, 8: Provider Needs (1/2) and (2/2), and 9: Engaging Independent Providers, and provided a brief
overview of the group's findings. It is understood that the staff and providers are the backbone of what makes
NHRMC great, so his group wanted to make sure that any potential partner had more to offer than what we already
do. NHRMC does a lot of great things such as offering competitive salaries and benefits, and it has been voted in the
top 100 places for employees to work in 2018 and 2019, and it has partnerships. However, it looked like the existing
infrastructure was not sufficient enough to continue that in terms of recruiting and avoiding staff shortages. To him
as a provider at NHRMC, it always feels that the hospital is always short. The numbers that it needs, even though it
has relationships with schools of nursing and other national recruiting efforts and when looking at the potential
partners, they really had regional hubs of how to acquire and grow their employment and advancement
opportunities from within. They offered many other ways of keeping the staff here that's current, but also elevating
them to different levels, as well as providing competitive market rates for salaries and benefits. They also had
significant exposure and stress on the ability to have diversity related resources that could be expanded. Also, the
most important thing was that they also offered many nurse recruiting and residencies so that the nurses in a local
facility can expand and do more than what just what they do every day. That was something his group felt was very
important and that all of these offers were really advancing more from what NHRMC had and could do.
In regard to recruiting and developing that talent, all the partners as shown on slide 23 offered much more
than what NHRMC currently offers. NHRMC has a formal leadership development program. Current leadership is
versed in traditional healthcare services, but there is a need of additional expertise that NHRMC cannot currently
offer. In looking at the respondents, they all offer coaching, learning technology, onboarding, and many other
options that NHRMC currently does not have access to. Some also offered to place a corporate department in
Wilmington, so an employee is not actually having to go to a long distance relationship for recruiting and doing those
types of things. That was very interesting to Member Shakar's group in trying to maintain and keep things local, as
well as the local leadership.
In looking at provider needs, this was very important to everyone as status quo and SystemCo really only
provide one quarter Harvey ball each. NHRMC has recently had some success locally with provider recruiting and
has been able to increase the numbers of providers from 30 in 2018 to 42 in 2019. Overall, however, the advanced
practice providers are one third of NHRMC's workforce. It was felt there was a need to focus on improving and
increasing what the recruitment could be and expanding that and those pipelines. Many of the respondents are able
to provide support for the development of advanced practice, provider strategy, and recruitment. Many of them are
keeping things local, local control with decision making, which was really significant for the group. Also important
was that NHRMC maintain its strong physician dyad model for provider engagement between physicians and
administration. When the group looked at the graduate medical education (GME), all of the providers really provided
an increase to what NHRMC currently has as well as offering new residencies, new fellowships, and other clinicians
to advance what NHRMC does as everyone had benefitted from having the local residencies and UNC School of
Medicine students coming here. Other provider needs the group thought were important was that there was some
service line leadership structure that we currently have, but all the respondents could really increase that, as well as
maintaining the current medical staff governance and related policies. All led to leadership roles for providers within
their current organizations which was a model that his physician group thinks would want to implement and continue
here. Independent providers were a significant aspect of what the group wanted to look at and while NHRMC has
great relationships with independent providers currently, it was felt each respondent offered more opportunities
for engaging the independent providers whether it is within the ACO or clinically integrated model. Besides the
benefits of joining a large entity of independent providers, they would be able to be a part of any group purchasing
organization or payer contracting to help support financial operational and clinical performance. It was really a well-
rounded way to include all providers, not just those that may be employed or through the Hospital Management
Group.
Member Gage stated she thinks the bottom line is that when you look at all of this objectively, what the
group saw were opportunities and possibilities in all four categories to go from good to great. It was clear where
NHRMC would be stronger. Member Adams stated she would echo Member Gage's comments and would add that
a part of what continues to be focused on was the mission of leading the community to outstanding health. Of some
of those words that kept coming back, leadership was one. The question became how do we strengthen the
leadership in the organization, it's strong but it could be stronger. The other piece was how do you develop a
comprehensive plan that connects the community and communities, the rural communities, the marginalized
communities, and how does the hospital itself lead that kind of effort. Outstanding health pretty much speaks for
itself and is for one person very different for somebody else. In just looking at the mission and concentrating on that
mission, she thinks the group came up with leaving the situation as it is, status quo, was just not going to work. Could
NHRMC survive in the next few years with that? Yes, it could do that. Would it thrive, would they flourish with this
organization, and the answer is no. Member Eckel stated that the one thing he has been surprised by over this
process is the amount of local control that all three finalists give NHRMC as it relates to local providers and hospitals.
NHRMC has always been concerned about this because local providers have always been the backbone of it and the
respondents have all put their money where their mouth is.
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JUNE 18, 2020 MEETING PAGE 5
Member Thompson stated his group covered KPEs 12: Financial Performance Benefits, 13: Addressing
Financial Gaps and Threats, 14: Total Financial Consideration, 16: Contemporary Governance Model, 17: Control at
The Local Level, and 18: Legal Organizational Model and provided a brief overview of the group's findings. The group
discussed financial security and governance. Slide 33 (KPE 16) shows that all the respondents give us almost
everything we want and this is the only area where status quo and SystemCo win, that is just 100% local control.
That is the only winner of those two. In looking at all the other KPEs, under financial performance, status quo and
SystemCo do not even rate in some and we get 25% of what we want in another. All of the respondents get to the
100% mark through some combination of the things they offer. In looking at governance, all respondents give 75%
of what we want, because obviously they retain some control so NHRMC does not have 100% local autonomy like it
does today. However, all the benefits that the other four groups just reviewed at length justify giving 25% of some
control up to get all of those other things. Co -Chair Broadhurst stated he supports what Member Thompson has said
that the objective measures are clear. He would also echo Member Eckel's earlier comment, as this group worked
through these KPEs and discussed the governance and a contemporary governance model that can transform
NHRMC's opportunities moving forward. Great opportunities were seen with some of the potential partners. This
group was taken aback at the extremely high level of local control, local governance, and local engagement for the
potential board locally as it was absolutely remarkable. His opinion is that is a reflection of what the respondents
felt about the NHRMC executive leadership and the quality of the Board of Trustees. He thinks they felt that was a
plus and a strength for NHRMC.
Member Eckel stated although he was not part of Member Thompson and Co -Chair Broadhurst's group, he
wanted to add that when members did the actual site visits with the recently acquired hospitals, interviews were
able to be done with board members that sat on the hospital boards before they were acquired and were now on
the boards of all three of the respondents. It was very interesting to see where they were sitting in our exact seat
and five years later telling the PAG members how much better, for all three of them, their communities were with
their new partnerships.
Member Dickerson, who was part of the group Member Thompson and Co -Chair Broadhurst were in, stated
he is being completely honest in saying he did not enter into this process with an open mind. He was probably stuck
in the position that everything is going pretty good, but he would listen. Things are going great and NHRMC does an
outstanding job. However, he thinks the work that keeps coming up is opportunity. The one thing that has popped
out to him in this process is health equity. He guesses his catchphrase that he has become famous for is that it's not
a matter of what you get, it's what you got to give up to get it. Early in the process the PAG discussed independence,
and through the process that word was eliminated and it was drilled down to control. The PAG was adamant that
had to be part of the process and the respondents came back with that as a key point in the presentations. He does
not think at this point that status quo is something that can be considered, because there are a lot of people in the
community that status quo does not work for. Ultimately as a community leader or community representative, it is
our job to make sure that the people that are not in this room, rural, inner city, different areas that do not have
access, and/or do not have the preventative primary care, that we make sure that we at least give an opportunity
for them to experience some of the things that we have seen that is performed in many other areas by these
respondents that offered to partner with NHRMC.
Member Thompson stated that Members Rudyk and Dickerson made some points in certain sectors about
health equity and the way things are working. He had the opportunity to go to a meeting today to see how COVID-
19, which is a pandemic, has had some positive results and has changed behavior. By that he will say that the NHRMC
emergency room visits were down, it was 4,500 to 4,800 visits, and doctor visits were up month to month at
approximately 13,480. That is moving people to primary care, getting out in their communities, providing healthcare,
and not choosing the hospital as primary care.
Co -Chair Biehner thanked all the members for the reports from on their respective workgroups. She thinks
what can be seen is where the PAG has been, what it has learned over the last several months, and that it has really
tried to ensure that the members are clear on what the choices are before them and how they compare. The PAG is
now at the next critical deliverable, which is whether to recommend a partnership, status quo, or a restructuring for
NHRMC, and she thinks this has been a great opportunity for the PAG to go through this and compare status quo
and restructuring with just the overall concept.
Co -Chair Broadhurst stated that the PAG's real exercise tonight is to give a deep dive into restructuring and
status quo. He thanked all the participants and everyone for all the work done over the months to really work on
that. Slide 36 is a summary and at the bottom shows that status quo and restructuring certainly retains local
governance, but fall short of providing access to people, processes, technology, to achieve and implement the
strategic plan, and they also fall short in increasing capital capacity to fully fund the strategic plan. In going back to
slide 16, and while having already heard from the teams, he would like to open it one more time to the PAG members
that may not have had the opportunity to speak on the different areas and thanked Member Dickerson and others
for their comments. He would like to hear from them in terms of after looking at the summary of the work the group
has done over the months about the opportunity we are in with restructure or status quo.
Member Papagikos stated much like Member Dickerson, his evolution went from pretty critical of the
process and he was sort of skeptical of the need for it. When he thinks about where he was last summer, he was
trying to understand why are we doing this because he thought the hospital is on good footing and he bragged to
people about how we're this large county -owned hospital, don't take any tax dollars, and do a greatjob. He was sort
of hit like a ton of bricks when this announcement came through. As he got more and more involved in the process,
and then as he got on the PAG he kept that skepticism, not cynicism, and he thinks that everyone here would
appreciate that he has asked difficult questions, asked Mr. Kahn hard questions, and in each step along the way
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JUNE 18, 2020 MEETING PAGE 6
trying to sort of prove the alternative hypothesis. At the end of this process, this quantitative or semi -quantitative
thing matches where he is in the process. He thinks that the right thing to do is to take on a strategic partnership
and he did not come to that conclusion lightly or flippantly. He thinks that what Co -Chairs Biehner and Broadhurst
did earlier of walking through that process of how we got here over these 14 meetings was helpful for him to sort of
understand and internalize how he sort of swung the pendulum from sort of a "hell no there's got to be a different
way that no one's been clever enough to think about", to thinking that there is real possibility and real meaningful,
generational transformation possibilities that are ahead of us if we pick the right strategic partner.
Vice Co -Chair Cameron stated when he first started someone asked why he was on the PAG, he responded
something along the lines of that he had a deep care for the long term health of the community. He will admit he
started like some of the others, he was a skeptic of a sale, especially a sale to a for-profit, that just didn't sound good
to him. He was a little more open minded, but skeptical nonetheless, to a relationship with a not-for-profit. However,
he was committed to listening and learning, and then making a decision later. In the process, he has learned more
about the changing healthcare environment, the move to population health and away from fee for service, the
movement for reduced payments from the government and other insurers, more risk for outcome being placed on
the hospital and on physicians. He was somewhat familiar with these concepts from the eight years he spent on the
UNC Healthcare Board and they were just reinforced by what he learned here. He would also say to people outside
of this room or to non-members of the PAG that if you do not understand the national change of the move to
population health and away from fee for service, or the movement of reduced payments, and the risks that are being
placed on hospitals and healthcare providers, he thinks it is very difficult for you to have an informed opinion on
what should happen with our facility. While he does not mean to lecture, but he thinks you have to understand those
issues. Through the process he became familiar with the strategic plan the NHRMC Board of Trustees put together,
learned a great deal about expanding access to care, and is light years ahead of what he used to understand about
the need for health equity. He has learned more on that subject than anything of any one other thing. He has learned
about the financial limitations of implementing the NHRMC strategic plan, if it stays as it is. He has come to
understand that there are relationships available that will allow NHRMC to implement its strategic plan, expand
services, grant access to care closer to where people live, greatly improve health equity, and to use analytics to
improve the quality of care, and other things will improve quality of care. He believes all of this can be done while
still maintaining local control of the operation of facilities and maintain relationships with health providers and non-
medical staff. He does understand that doing something involves risk and that not doing something also involves
risk. He believes the risk of not doing something far outweighs the risk of partnering with one of the three
respondents. Even more important, he believes the opportunity of partnering with one of the respondents will be
transcendent and will greatly increase the health of our community, far beyond what we can achieve on our own.
Member Gage stated as a community member and a complete layman she had a huge learning curve when
she became part of this process. She was a skeptic and completely focused on what we would lose. It took her a long
time to understand, or to focus on, the possibilities and on what we would gain. Her goal was to learn as much as
she could and just make an informed decision and try to be open minded. She thinks she has done that, she feels
she has developed a much deeper understanding of the challenges of staying independent and of the opportunities
of partnering with the right partner. Then COVID came along and it was about midway through this process, and she
thinks the group would be fooling themselves if they thought the process was not dramatically changed by that,
because the lens through which we looked at healthcare was forever changed. At that point for the first time, even
though she knew how well NHRMC did, it was the first time she realized how vulnerable we were. She remembers
the last in-person meeting she had with her small group with Members Eckel and Gizdic, it was before everybody
was sheltering. She asked Member Gizdic how things were going and he said he felt like he was in a little dinghy, out
in a typhoon and at that time, we didn't really have the systems in place to even get tests done. The wait was days
and days. It shifted for her because she saw what was happening if you had a partner, and in that sense NHRMC was
lucky it had a partner to help with the tests but the staff were driving back and forth to Charlotte. It changed because
NHRMC looked vulnerable for the first time to her, and then she began to look at the possibilities, and the
conversations continued with these groups. You always hear people talk about how they have systems, platforms
and analytics, and it sounds so completely abstract, until you begin to understand. Those are the things that enable
you to provide modern care, patient centered care in their homes, etc. and she began to evolve and look at what
she thought could be an enormous opportunity here, not just in the delivery of care, but if you look at it with all
three of these partners, the expansion of GME, and what those things might become down the road. She surprised
herself after the better part of the year. She thinks that what will be lost by giving up the independence pales in
comparison to what will be gained by finding the right partner with the right terms that gives the kind of local control
that we want. She thinks that will be transformative and so she has changed her mind.
Member Campbell stated he believes Member Dickerson took most of his points, but at the fear of being
redundant, he was also very skeptical of this whole process. He was concerned about the underprivileged, the
economically challenged, the poor guy being used while the hospital walked away with millions of dollars. His
concern was about health equity, and then at times the PAG was talking about costs, reducing costs, but that's a
relative term, if he has got the money the cost doesn't matter. Health equity was his battle cry and he was concerned
that we might step over the underprivileged, that we might serve a few privileged doctors. He says doctors because,
after being a part of this group, he has seen them fight for the equity of everybody. He was very pleased to find that
he was proud to be a part of this group. He felt that if someone had a preset agenda, they hid it very well because
he saw people argue from both sides of the question. He thinks he read somewhere that two are better than one
and we know that the economy of scale is important. When he joined the PAG, he thought NHRMC had $350 million
or so, but he found out that it didn't have the top rating and it was about $125 million short of that. He found out
that the hospital was running over 90% of capacity and people were already waiting in hallways in beds, he couldn't
believe that. Even though it is a well-run institution, as evidenced by the respondents, he found out that it doesn't
take much to change that equation very quickly. Member Gizdic made the group gasp when he talked about the
PARTNERSHIP ADVISORY GROUP
JUNE 18, 2020 MEETING PAGE 7
statistics in the financial and the economic status of NHRMC, which is lauded. He was very pleasantly surprised to
find that two of the respondents are national winners of increasing the health equity. He found that the partnership
far outweighs what we're doing and he thinks that timing is everything. He believes that we're at the right time, the
right place to do the right thing for the future of our community and that means finding a partner, so we can raise
the economy of scale and improve the health equity for everyone. He is glad that he has been a part of this because
he was a naysayer, he was determined to make sure he represented those who couldn't be in the room, but he
found that there were a lot of people that ended up having that same idea.
Member Fuller stated he has had a long experience with NHRMC and quite honestly, he was very biased
going into this. NHRMC did 90% of everything terrific. If you look at the change over the last 10 years at NHRMC,
everything has improved dramatically. However, as part of this process what we have all discovered is people do it
even better than NHRMC does, better from the aspect of the way they approach it, use of technology, additional
funds, and ability to do things that NHRMC just didn't have the capability of doing. He is impressed with what some
of these partners have done with the health equity in their communities. Well beyond our thought process of doing
something, they actually are doing something, and that's something that would probably have taken NHRMC years
to do. One of the things he has experienced in his life is the hardest thing in the world for people to do is accept
change. The hardest thing in the world for somebody to do is to accept that changing and doing something different
will actually improve the outcomes dramatically. He thinks what this group is starting to realize is that by embracing
the possibility of change, embracing the possibility of a partnership, we can dramatically improve the healthcare
environment, the hospital, the resources, the medical attention provided to these seven regional areas, and maybe
even broader in southeastern North Carolina. He is very pleased to have been part of this group, and is wonderfully
pleased and his heart is warm to see how everybody has embraced, listened and participated. But recognize that
there's about 250,000 or 300,000 people in these communities around us that need to understand why this change
is needed, why this change is good, and why this change is going to bring positive influence, positive change going
forward. He thinks that is the challenge now to articulate this message in a way that not only the 21 members of this
group but the 600,000, and growing, people in this community can also embrace it, not just rattle about it, embrace
that it is something that is going to be better for our community.
Member McGhee stated that he wanted to piggyback on what Member Fuller was saying. The word
disruption was the word that kept him engaged and he wanted to be a part of this. Just to use a couple of examples,
just a handful of years ago, there was a Blockbuster on every corner and now they are mattress stores. What
happened was, this may be some kind of urban legend and is not sure it's actually true but he thinks it is, Netflix
came to Blockbuster and said look, we got a deal for you. We'll sell you Netflix for tens of millions of dollars and
Blockbuster said no because people love the experience of going to Blockbuster. We see now that was not true and
it was not that they had bad management. They did not prepare for the potential disruptions because of the
technology. The technological innovations that are available now will, for the foreseeable future, disrupt healthcare
as we've always known it. The other example he wants to use is when he was a kid it was a big thing to go to Sears.
The big Sears Tower was built in Chicago in 1973 and in 1994 the company sold it. He thinks that was the first year
Amazon sold something or shipped a package. Sears sold that which was an iconic image of their power. He would
argue that there was good management, they were making good decisions, but they were not paying attention to
the technological innovation that was coming was going to undo them. The reason he says that is because the
problem with disruption is if we're not thinking outside of the box, by the time we look around, it's upon us and
somebody else has already taken advantage of it. To Member Fuller's point, we have to share these ideas, these
concepts with the community here, so they understand it's not about somebody getting a big payoff or anything like
that. It's to protect the hospital and healthcare in this area from catastrophic disruption. To do that, we basically
have to choose our disruption, not let disruption choose us. He thinks that is what this advisory group is doing. We're
saying we're going to choose the change that we're going to go and take advantage of, and we are not going to let
it choose us and potentially destroy us. Because if we go to these same organizations with our heads in our hands,
it's a completely different conversation. Now we're going from a position of strength.
Member Hall stated everyone has pretty much said everything she thought and she was also very skeptical
about all this. Through all the meetings and the education that the members have had, she thinks it is the obvious
choice to move forward with a partner, to continue and to thrive with the health of our community, and she sees it
as the only way to do that. She'll save the long speech, but she thinks it's all been said and she agrees.
Member Williams stated he thinks the members have unofficially eliminated status quo and SystemCo this
evening as a group and he would be prepared to make a motion that the PAG officially do it. He thinks to continue
exploring these two options is not a good use of anyone's time, expectations, or hopes. Co -Chair Broadhurst stated
he would take it as a motion, but before the PAG accepts that, he asked if there was any objection to it from any
advisory group member. Member Coudriet stated he would object to that just based on the discussion that the
County Commissioners, he thinks shared with by leadership of the PAG that we're still going through an evaluation.
He thinks it was very clear, from some of the County Commissioners, that they believe the PAG needs to continue
this kind of discussion and put on a clear business case analysis of perhaps why status quo or SystemCo do not work.
This is the first public discussion with this depth of exposure that PAG has had and he just thinks it would be
premature to do that, so if there's a motion and a second, he will vote against that. Member Williams stated he does
not want to do something that could cause trouble on the back end, but hearing what he heard tonight, he also does
not want to insult someone and withdrew the motion. Co -Chair Broadhurst responded he was not and accepted the
withdrawal. He further stated that the PAG charter is pretty clear that the final official vote on it should be comparing
it to one potential partner, as opposed to the three. He thinks it would be appropriate and consistent with the
charter if the vote was moved to that portion of the PAG's deliberations. To Member Williams' point however, let's
not insult ourselves or the public about the PAG's direction. It is crystal clear and he thinks they have heard from
just about all of the PAG members how they feel and he feels the ones that spoke did so with a unanimous consent
PARTNERSHIP ADVISORY GROUP
JUNE 18, 2020 MEETING PAGE 8
that any one of the three potential partners are a better option than status quo and SystemCo. He thinks it is fair to
the public to hear that and it is fair for the PAG to communicate that and he thinks that has been done. However,
he thinks from a procedural standpoint, the PAG should stick to its rules and have that vote at another time, but he
agrees with Member Williams and has heard all the comments as well.
Member Gage asked if the Harvey ball analysis shown tonight will be shared, because she thinks that shows
the data. She thinks it would be important before the PAG has a motion for anything to share that with the County
Commissioners and NHRMC BOT so they can look at that analysis. Co -Chair Broadhurst stated that was a good point
and it will be done. Also to Member Coudriet's point, during the presentation to the County Commissioners, a couple
of the Commissioners asked specifically for the analysis that was done tonight. It will be shared immediately after
this meeting so the County Commissioners and NHRMC BOT have the information and at the same time understand
the direction of the PAG at this point. Co -Chair Biehner stated it will be shared on the NHRMCfuture.org by
tomorrow.
Member Van Pelt stated she does want to make it clear to the public while they are listening that one of
the most important things that has been talked about, repeatedly, from the PAG is that the public hears from them
and understands how important it is that they are transparent. With all the information and the facts that have come
out tonight, she highly encourages everyone to go to the website tomorrow to review it. She would never want to
throw all this information at someone tonight that she has absorbed over six to seven months and even pushing a
lot of things to the side just to take it all in. She would highly encourage the whole community, all 600,000 who we're
really trying to serve, not just Wilmington, to take advantage of reviewing the information and if they do not have
access, she thinks the group needs to find ways to get this information to them. Personally, she would encourage
everyone to attend the June 22"d public hearing, if they are able. Also if for some reason a person feels they are not
getting this information, she asked that they reach out to the PAG members so that if the information needs to be
printed, if it needs to be in large print, or if it needs to be recorded it can be. It is the PAG's responsibility to make
sure that this information gets out and give everyone time to absorb it before there's anything pushed forward.
Co -Chair Broadhurst thanked everyone for their comments.
CLOSED SESSION
Co -Chair Broadhurst announced that the meeting would move into closed session for confidential
discussion and review of confidential information, pursuant to North Carolina General Statute (NCGS) 143-
318.11(x)(1), NCGS 143-318.11(a)(3), and NCGS 131E-97.3. These protect competitive healthcare activities and
attorney-client matters. He asked for a motion to move into Closed Session.
Motion: Member Williams MOVED, SECONDED by Member Coudriet to enter into a closed session pursuant to NCGS
143-318.11(a)(1), NCGS 143-318.11(a)(3), and NCGS 131E-97.3. These protect competitive healthcare activities and
attorney-client matters. Upon vote the MOTION CARRIED UNANIMOUSLY.
Co -Chair Broadhurst excused the public participants and convened to Closed Session at 7:10 p.m.
CONVENE TO OPEN SESSION, CLOSING REMARKS, AND ADJOURNMENT
Co -Chair Broadhurst called the meeting back to order at 9:22 p.m. and thanked the members for their
discussion and work during the closed session and expressed appreciation to public who remained on the line during
that time. There being no further business, Co -Chair Broadhurst adjourned the meeting at 9:22 p.m.
Respectfully submitted,
/Kymberleigh G. Crowell/
Kymberleigh G. Crowell
Clerk to the Board
Please note the above minutes are not a verbatim record of the Partnership Advisory Group meeting. Meeting
materials associated with this meeting are included as attachments to these minutes for reference.
G0 X)N�Y
11 O `
N New Hanover S
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\s
\�BLIS771�
121
Section Page Number
1. Welcome
K
2. Consideration of Pursuing a Partnership vs. Status Quo or Restructuring 4
3. Closed Session -
4. Closing Remarks 43
2 N New Hanover �_=I
11 Regional Medical Center
SOME
New Hanover
Regional Medical Center
NNew Hanover
Regional Medical Center
SIDERATION OF PURSUING A
"NERSHIP VS. STATUS QUO OR
FRUCTURING
COMMUNITY MEMBERS, NHRMC TRUSTEES,
WHO WE ARE:::21 PHYSICIANS, COUNTY AND NHRMC LEADERSHIP
WHAT WE DI D • UNDERSTOOD THE CHARGE AS AN ADVISORY GROUP TO THE NHRMC AND COUNTY BOARDS
0 • REVIEWED THE CURRENT HEALTHCARE LANDSCAPE AND NHRMC'S STRATEGIC OUTLOOK
•
W
• • DEVELOPED THE GOALS AND OBJECTIVES FOR THE PARTNERSHIP EXPLORATION PROCESS
'r4
ASSESSED THE FEASIBILITY OF NHRMC REMAINING STATUS QUO OR RESTRUCTURING
• REVIEWED PROPOSALS AND ENGAGED WITH RESPONDENTS TO ASSESS PARTNERSHIP OPTIONS
5 WORK ASSESSING STATUS QUO,
14 PAG Meetings over 9 Months RESTRUCTURING, AND
And counting! GROUPS PARTNERSHIP
2 MEETINGS
TO UNDERSTAND
NHRMC AND THE
INDUSTRY
TRANSITION IN
HEALTHCARE
4 MEETINGS
TO DEFINE
GOALS AND
OBJECTIVES AND
DEVELOP AN RFP
4 MEETINGS
TO UNDERSTAND
RESTRUCTURING
OPTION &
STRATEGIC
OUTLOOK
4 MEETINGS
TO ASSESS THE
PROPOSALS
RECEIVED IN
RESPONSE TO
THE RFP
mAnd Countless Hours Spent on Homework and Reading
Industry Articles and Information Shared by the Public
SUPPORTED BY A MULTIDISCIPLINARY TEAM OF NHRMC
AND COUNTY LEADERSHIP AND OUTSIDE ADVISORS
l
rM PUBLIC PRESENTATIONS
BY EACH RESPONDENT TO
av::] THE PAG
12 SITE WITH THE RESPONDENTS
TO UNDERSTAND FIT AND
VISITS CONDUCT DUE DILIGENCE
TIME LISTENING TO THE
COMMUNITY, NHRMC
EMPLOYEES & PROVIDERS
NNew Hanover
�1 Regional Medical Center V�
P181 rl
NHRMC Board develops
and approves current
strategic plan with
focus on access, value,
and health equity
PTOIL-1
NHRMC Board identifies
structural and financial
barriers and begins
vetting SystemCo
restructuring
Lean facilitators ask NHRMC
BOT: What factors may inhibit
NHRMC's ability to carry out,
enhance and sustain its
mission?
R
2019
■■■■■■■■■■r
■ After fully vetting
■ option, NHRMC
' BOT determines ■
■
■ SystemCo
■ restructuring
' offers limited ■
■
■ value and
■ begins
partnership ■
■ discussion;
■ Works with
' Commissioners ■
■
■ to establish
■ PAG
PAG understands
NHRMC current state
and healthcare industry
transformation
2020
PAG evaluates NHRMC
Strategic Outlook
including impact of
SvstemCo
PAG develops
comprehensive Goals
and Objectives and
issues RFP
Jun
PAG understands
proposals and evaluates
value to NHRMC and
the community
NNew Hanover
11 Regional Medical Center
NHRMC is influenced by national healthcare trends and shifting market dynamics
What challenges are faced by What's happening in
NHRMC in today's healthcare Wilmington and NHRMC's 7 -
landscape? County Service Area?
1. Reduced Reimbursement in an
Aging Population
2. Increasing Regulatory
Scrutiny
3. Payment Model Transition
to Value -Based Care
4. Shift from Inpatient to
Outpatient Care Settings
Projected County Population Growth
(2017-2030)
Bladen
>_6%
Brunswick
+21 %
D
Columbus
+0%
D
Pender < 10 0 Duplin
0
+16% NHRMC Inpatient-
+15% New
9
Hanover
Onslow +10%
VNew Hanover
Regional Medical Center
Strategic Plan Our goal in this process is to better position NHRMC to achieve its strategic
plan
Guiding The Guiding Principles serve as a framework of desired outcomes across key
Principlesdimensions (i.e. operational, clinical, etc.) to guide the partnership exploration
process
The Goals and Objectives are specific actions required for NHRMC to achieve the
desired outcomes as stated through Guiding Principles. They serve as the basis
for the development of RFP questions and the criteria against which each
strateaic oation will be evaluated
A Request for Proposal (RFP) is a document to collect required information
from potential partners to enable evaluation of proposals against defined
partnership goals and objectives
VNew Hanover
Regional Medical Center
Strategic Outlook Factors•
•
The combined implementation complexity and
Determine if NHRMC is positioned to achieve its
financial demand of all strategic needs inhibits
strategic plan
NHRMC's ability to optimally address each of
these demands at the required pace
NHRMC has structural barriers to achieving its
Understand NHRMC's legal organizational
strategic plan, adapting to healthcare industry
structure
transformation, and achieving governance best
practices
Funding the strategic plan would stress NHRMC's
Evaluate NHRMC's long-range financial plan
balance sheet potentially resulting in default on
and ability to fund capital needs
bonds or downgrade in credit rating approaching
`Baa'
Discuss alternative scenarios, such as tax payer
Tax support to fill existing financial gaps would
funding, to fund NHRMC's capital needs while
translate to a 21 % increase in property tax rates,
maintaining current legal organizational structure
up to 68% increase inclusive of potential threats
NNew Hanover ( ;I
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Pros
Cons
Joint Venture
Full Integration
Joint Venture
Full Integration
Receive maximum
Lower amount of
•
Maintain ownership interest
consideration and
consideration paid and
Relinquish ownership
commitments include fully
commitments made by
interest
funding Strategic Plan
partner for partial ownership
Board . Maintain role in governance
Maintain role in governance
Subject to partner "veto
Subject to parent reserved
rights / reserved powers"
powers
= • • • Appointment of directors to
Appointment of directors to
Partner gets appointments to
Partner has more limited role
Appointment governing board
governing board
governing board
in appointments
Capital Potential opportunity for
No further capital
Ongoing commitment to
Few, if any, opportunities to
Commitment distributions
commitments
contribute capital if required,
participate in ongoing
or risk dilution
distributions
Full ROI achieved at closing /
Responsibility for at least a
Return on Potential future returns on
Maintain right of reversion /
part of ongoing debt and
Likely no participation in any
Investment investment
No ongoing debt obligations
downside risk
future returns
or downside risk
Partner has full incentive to
Organizational
invest / Retain ability to
Less incentive for partner to
Reduced ability to control
Direction Ability to influence strategy
influence strategy through
prioritize investments in
strategy
local board and parent board
venture
appointments
Pros and Cons based upon understanding of proposals received
10
NNew Hanover
11 Regional Medical Center
1.
Expansion & Reconfiguration of
Strategic Need(s): Expansion & Reconfiguration of
Facilities
Facilities
Improving Access to Care and Wellness
2.
Ambulatory Network Development
Strategic Need(s): Ambulatory Network Development
3.
Information Technology & Digital
Strategic Need(s): Transparency; Consumer -Friendly
Solutions
Technology; Telemedicine Adoption; Technology Platform
Advancing the Value of the Care
4.
ACO and Health Plan Development
Strategic Need(s): ACO and Health Plan Development
Strategic Need(s): Full -Scale Health Equity Program;
Achieving Health Equity
5.
Full -Scale Health Equity Program
Fulfills commitment to mission and serving all regardless of
abilityto pay
6.
Avoiding Staff Shortages
Strategic Need(s): Avoiding Staff Shortages
Supporting our Staff
7.
Developing and Recruiting Talent and
Strategic Need(s): Developing and Recruiting Talent and
Expertise
Expertise
8.
Provider Needs
Strategic Need(s): Provider Needs
Partnering with Providers
9.
Engaging Independent Providers
Strategic Need(s): Engaging Independent Providers
Driving Quality Care Throughout the
10. Clinical Transformation
Strategic Need(s): Evidenced -Based Protocols; Care
Continuum
Coordination Across the Continuum
11
N New Hanover ( ;I
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Growing the Level and Scope of Care 11. Partnerships for Highly -Specialized Strategic Need(s): Partnerships for Highly -Specialized
Services Services
12. Financial performance benefits
Strategies to identify and capture synergies with potential
partner and preserve key existing financial drivers
Investing to Ensure the Long -Term
13. Addressing financial gaps and threats
Ability to fund strategic plan to address NHRMC's existing
Financial Security
financial gaps and potential threats
14. Total financial consideration
Total financial consideration commensurate to proposed
strategic partnership structure
Strategic Need(s): Integrated, Regional Health System;
Strategic Positioning
15. Integrated, Regional Health System
Broader desire to positively impact region's economic
status
16. Contemporary governance model
Barrier(s) identified by NHRMC BOT: Diplomatic Hurdles
17. Control at the local level
Preservation of majority control of the organization at the
Governance
local level
Barrier(s) identified by NHRMC BOT: Growth Outside the
18. Legal organizational model
County; Branding Inflexibility; Financing Opportunity;
Investment Limitations; Scale Limitations
12
N New Hanover=j
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PROPOSAL ELEMENTS
New Hanover
11 Regional Medical Center
• During PAG Meeting #10, the PAG developed Key Proposal Elements (KPEs) based upon NHRMC's
strategic needs
• The KPEs were designed to facilitate the assessment of each proposal's ability to meet NHRMC's strategic
needs. Additionally, KPE assessments were completed for NHRMC Status Quo and NHRMC SystemCo
• The following slides present an aggregated view of the partnership option relative to NHRMC SystemCo
and NHRMC Status Quo
Please Note: The Partnership description does not represent any one proposal. Rather it represents,
based upon the proposals, site visits, presentations, and follow up inquiries and clarifications, what
the PAG understands to be available to NHRMC and the community by selecting a partner
14 N New Hanover=I
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15 N New Hanover
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Relative to other proposals received, this organization's response addresses RFP questions related to this KPE in a compelling manner,
•
demonstrating (i) clarity of specific plans for NHRMC with qualitative and quantitative detail, (ii) clear qualifications demonstrating the ability
to deliver on those specific plans, and (iii) the willingness to be committed to the community to deliver those specific plans.
Relative to other proposals received, this organization's response addresses RFP questions related to this KPE in a comprehensive manner,
providing a good level of explanation on (i) clarity of specific plans for NHRMC with qualitative and quantitative detail, (ii) clear qualifications
demonstrating the ability to deliver on those specific plans, and (iii) the willingness to be committed to the community to deliver those specific
plans.
Relative to other proposals received, this organization's response addresses RFP questions related to this KPE in an adequate manner,
providing some but not enough explanation on (i) clarity of specific plans for NHRMC with qualitative and quantitative detail, (ii) clear
qualifications demonstrating the ability to deliver on those specific plans, and (iii) the willingness to be committed to the community to deliver
those specific plans.
Relative to other proposals received, this organization's response does not address RFP questions related to this KPE in a clear manner,
O
lacking sufficient explanation on (i) clarity of specific plans for NHRMC with qualitative and quantitative detail, (ii) clear qualifications
demonstrating the ability to deliver on those specific plans, and (iii) the willingness to be committed to the community to deliver those specific
plans.
Relative to other proposals received, this organization's response does not address RFP questions related to this KPE in a adequate
O
manner, lacking sufficient support for achieving the KPE.
N/A No response provided for this KPE.
15 N New Hanover
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Key Proposal Partnership
�V New Hanovet
�t Regional Medical Center
� New Hanover
Regional Medical Center
Status Quo
SystemCo
Improving Access to Care and Wellness
1. Expansion &
—•ansformation
Reconfiguration of
Facilities
11. Partnerships for
2. Ambulatory Network
— •
O
O
Development
Services
3. Information
— •
O
O
Technology
N/A
Performance Benefits
Advancing the Value of the Care
4. ACO and Health Plan
— •
O
O
Development
Gaps and Threats
Achieving Health Equity
5. Full -Scale Health
— •
O
O
Equity Program
Supporting our Staff
6. Avoiding Staff
— •
O
O
Shortages
7. Developing and
16. Contemporary
O — Ql
O
Recruiting Talent and
Governance Model
Expertise
17. Control at the Local
•
Partnering with Providers
8. Provider Needs
Q
Q
9. Engaging
—
O
Independent
Providers
• • • Partnership
'r New Hanover
1,Regiorwl Medical Center
I New Hanover
�1 Regional Medical Cen[er
Status Quo
Systemco
7Driving Quality Care Throughout the Continuum
inical
—•ansformation
Growing the Level and Scope of Care
11. Partnerships for
Highly -Specialized
Q1 —
Q
Q
Services
Investing to Ensure the Long -Term Financial Security
12. Financial
Q1_0
N/A
N/A
Performance Benefits
13. Addressing Financial
— •
O
O
Gaps and Threats
14. Total Financial
—
N/A
N/A
Consideration
Strategic Positioning
15. Integrated, Regional
— •
O
O
Health System
Governance
16. Contemporary
O — Ql
O
O
Governance Model
17. Control at the Local
•
•
Level
18. Legal Organizational
—
O
Model
16 N New Hanover ( II
�1 Regional Medical Center V�
■�� New Hanover 11
�r New Hanover
Partnership �1 Regional Medical Center 11 Regional Medical Center
Status Quo Systemco
4_0
• Significant financial commitments enable
NHRMC to accelerate efforts to:
• Enhance the service lines to broaden
reach and care for additional
communities in southeastern North
Carolina
• NHRMC has implemented numerous
programs to improve care coordination to
better manage increasing volumes, including
use of real-time location tracking systems,
multidisciplinary rounding, & digital
standardization.
• Develop and upgrade the main i• NHRMC has had success in driving down
campus to expand tertiary/quaternary hospital utilization rates among existing
capabilities patients (e.g., 14% reduction in Medicare
• Develop innovative and sustainable admission rate).
health delivery models in rural • Focused efforts on reducing need for
communities I hospital services are not able to keep pace
Partners offer advanced methodology to I with increasing capacity demands
identify where services are most needed and • Long-term regional growth is expected to
the capital, scale and infrastructure to more
rapidly act on that information. I continue to accelerate.
• NHRMC has evaluated existing facilities,
designed future -state recommendations,
developed a 10+ -year implementation plan,
and determined capital requirement to
expand and reconfigure facilities. But capital
is not available to implement at the pace
needed.
17
• Restructuring to a SystemCo model may
ease limitations on investing in facilities and
services outside New Hanover County, but
NHRMC would still be in the same financial
position, and would need access to
additional capital (this could be limited) in
order to pursue investments outside the
County
New Hanover
Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
QI— O
• Significant financial commitments would
enable NHRMC to add outpatient medical
services and practices in extended service
area, giving residents more convenient
access to care that helps them manage their
health.
The growth of NHRMC's ambulatory network • Restructuring to a SystemCo model may
to meet projected growth in outpatient
volumes and provide more convenient,
affordable care options is restrained by
structural and capital limitations inherent in
ease limitations on investing in facilities and
services outside New Hanover County, but
NHRMC would still be in the same financial
position, and would need access to
existing structure. These include the ability to additional capital (this could be limited) in
• Robust ambulatory strategy invest in facilities outside New Hanover
supported/funded by partnership would help County, where more than 50% of NHRMC
decompress main NHRMC campus, allowing patients live.
for more focused use for high-end services.
,.
NHRMC has purchased land for the Scotts
• Partners offer specific market-based plans
using advanced data analytics tools.
• Partners could support expansion of well-
established ambulatory networks that include
innovative approaches to care delivery,
cl
inuding telemedicine and behavioral health.
Hill Campus and the Autumn Hall
expansions, but building these projects will
effectively consume all available capital,
preventing the ability to grow other services
for an extended period of time.
order to pursue investments outside the
County.
NNew Hanover
11 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
(0-0
Partners offer scalable telehealth solutions
to increase access for patients throughout
the region.
Partners provide access to consumer -centric
digital platforms including web scheduling,
online chats, and telephonic support for
patients.
Partners offer real-time sophisticated
analytics capabilities.
• Partners commit to developing a command
center to service NHRMC.
• Site visit presentations highlighted strong IT
capabilities and infrastructure.
• Would need to work toward mature price
transparency tool with potential for
implementation at NHRMC.
19
• NHRMC offers MyChart patient portal and
NHRMC App.
• NHRMC has deployed limited telemedicine
capabilities (telehealth home care, E -visits,
telehealth connectivity at facilities).
Plans to launch customer relationship
management ("CRM") to improve
communications with patients on hold for
limited funding.
• Despite investment of $750 million in capital
investment and operating expenses over the
past 10 years (including Epic EMR
implementation), current technology platform
does not meet today's needs given
increasing role and importance of analytics
and technology in healthcare delivery
• Recent addition of Health Catalyst to
analytics portfolio will support data
integration and robust analytics offerings
(—$1 M/year investment), but more is needed
to fully deploy.
• Restructuring to a SystemCo model will not
directly improve NHRMC's information
technology. Capabilities remain as status
quo.
NNew Hanover
�1 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
Q1_0
Partners would provide access to shared
infrastructure and corporate services
(analytics, clinical solutions and
documentation excellence, safety and
regulatory accreditation) which would lower
cost of growing NHRMC's ACO program to
serve more area residents.
Partners would provide access to multi-
disciplinary, care management teams across
the continuum to offer area patients more
seamless access to care.
Inclusion in larger, more mature Accountable
Care Organizations with additional covered
lives across payers (i.e. commercial,
Medicare) will lower costs reduce risks.
Health plan and value -based contracting
experience can advance NHRMC strategy
Partners offer Medicare Advantage programs
which could help growth of NHRMC's new
Medicare Advantage product for area
retirees.
20
• NHRMC Medicare Shared Savings Program
ACO, Physician Quality Partners, has —19K
covered lives and achieved a 95.12% quality
score and $282 reduction in cost per
beneficiary for the 2018 plan year
• NHRMC offers Medicare Advantage Health
Plan for residents of New Hanover County
• NHRMC processes to manage population
are largely manual and network of
participating providers is limited, creating
inefficiencies and limiting ability to scale up
to help improve quality and lower costs for
more area residents.
• Restructuring to a SystemCo model will not
directly improve NHRMC's ACO and health
plan development capabilities. Capabilities
remain as status quo.
NNew Hanover ( ;I
�1 Regional Medical Center \ i
■�� New Hanover
Partnership 11 Regional Medical Center
Status Quo
4-• 1 O
• All respondents demonstrated success in i• Current NHRMC programs include Mission
addressing social determinants of health and, Corps, Barbershop Initiative, Food
two of three respondents were recently
nationally recognized for their efforts in
Health Equity by receiving the CMS Health
Equity Award within the first three years of its
establishment.
Respondents demonstrated success in
partnering with community organizations to
address social determinants of health and
have committed to continue existing NHRMC
programs.
Respondents offer access to expertise,
frameworks, and data analytics to support
NHRMC health equity program, as well as
access to employee training and other
programs to ensure culturally competent
care.
Respondents have well-established supplier
diversity initiatives
Respondents have committed to continue or
improve NHRMC's charity care program.
21
Pharmacy, Dancin' in the Park programs,
community partnerships geared towards
addressing the opioid crisis and
homelessness as targeted social
determinants of health, and adding
community health workers in Northside
neighborhood.
• "Every Day" Bias training and employee
resource groups available to all employees.
• NHRMC offers Healthcare Explorers
program for youth.
• NHRMC is piloting standardized screenings
for social determinants of health, but there is
minimal use of data to identify opportunities
and measure effectiveness of programs.
• Without sophisticated data systems and
infrastructure, programs will remain limited in
scope and impact.
11
�r New Hanover
�1 Regional Medical Center
Systemco
• Restructuring to a SystemCo model will not
directly impact or expand NHRMC's health
equity program. Capabilities remain as status
quo
NNew Hanover ( ;I
11 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
4_0
• Respondents propose building regional hub
of services, growing employment and
advancement opportunities.
Respondents have indicated that all
employees in good standing will continue to
be employed in their current positions and
are committed to competitive market-based
benefits for NHRMC's employee base to
minimize disruption.
Prior employment and service with NHRMC
will be considered in full and partner will work
11
• NHRMC offers competitive salaries and
comprehensive benefits including generous
health coverage, childcare, wellness
programs and tuition assistance.
• NHRMC Will continue existing staffing and
compensation commitments as long as
economically feasible.
• NHRMC achieved Forbes Top 100 Large
Employers (2018 and 2019); Becker's
Hospital Review 150 Top Places to Work in
Healthcare (2019).
with NHRMC to develop a competitive . Partnership with Schools of Nursing and
retirement savings program. I national recruitment efforts support a growing
• Access to diversity -related resources and
programming will be expanded.
• Support for recruitment and retention
[including specific nurse recruiting resources
could be enhanced through different
programs offered by the potential partners_
22
nurse pipeline.
• Existing NHRMC infrastructure may not be
sufficient to recruit staff to meet growing
demand in region while the industry faces a
shortage in healthcare workers.
31
• Restructuring to a SystemCo model will not
directly improve NHRMC's staff job security,
benefits, or recruitment. Capabilities remain
as status quo.
NNew Hanover ( ;I
�1 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
4_0
• Respondents have system -level leadership
development; orientation & onboarding;
learning technology; more sophisticated
succession planning; onboarding, coaching,
and education;
I• Leadership recruitment support
• Specific programs for developing nurse
leadership
• Location of a new shared -services center
and corporate department in Wilmington.
23
• NHRMC offers a formal leadership
development program developed and run by
current NHRMC employees (should have
nearly all Directors and above completed by
year-end).
• Current leadership is well -versed in
traditional healthcare services and recent
recruitment has included new expertise (i.e.,
clinical transformation and health plan
operations).
• To ensure clinician representation at all
levels and keep pace with new business
models and functions in healthcare,
additional expertise is needed.
• Restructuring to a SystemCo model will not
directly improve NHRMC's ability to develop
and recruit talent and expertise. Capabilities
remain as status quo.
NNew Hanover (=I
�1 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
0
Respondents have strong physician dyad
models and approach to provider
engagement
• Respondents offer more robust provider
resiliency programs which could be
expanded
Local control and decision-making for
provider issues
• Networks in place for physician group
management.
• Status quo will continue existing medical
staff governance policies and procedures
• No disruption to employed physician group
management. The NHRMC /Atrium
Physician Network Management Agreement
would continue
• Recent success in provider recruiting
includes recruiting 42 providers in 2019 (21
MD and 21 APP) and 30 providers in 2018
(16 MD and 14 APP)
• Support for the development of a NHRMC Overall APP's are —1/3 of the NHRMC
Advance Practice Provider strategy I provider workforce with expected expansion
of recruitment
• Support for provider recruitment and
expanded reach into new recruiting pipelines
• Expansion of Graduate Medical Education
programming at NHRMC including
increasing residents in existing programs
and offering new residencies and fellowships
for physicians and other clinicians
24
• NHRMC achieved Joy in Medicine Bronze
Level Designation for NHRMC Physician
Group and developed and administered a
MiniZ provider burnout survey
• Restructuring to a SystemCo model will not
directly improve NHRMC's ability to support
provider needs. Capabilities remain as status
quo
Provider Needs Rating Rationale continued on subsequent page
NNew Hanover
�1 Regional Medical Center
■�� New Hanover ��
�r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
0
Clinician leadership development and
executive leadership development programs
• Support for and access to additional clinical
trials and research funding
• Augmentation of existing staff through virtual
consultation with in system specialists
• Continuation of current Medical Staff
Governance and related policies and
procedures subject to further due diligence
• Leadership roles for providers throughout
Lorganizations
25
• Service line leadership structure supported
by physician dyad leadership program and
provider forums
• Research Finance Coordinator role and two
Cardiology Study Coordinator roles support
research at NHRMC
• Commercial IRB allows studies with IRB
approval at another site to be processed
locally
• See prior page
Provider Needs Rating Rationale continued from prior page
NNew Hanover
�1 Regional Medical Center
■V New Hanover 11 New Hanover
Partnership �1 Regional Medical Center 11 Regional Medical Center
Status Quo Systemco
(0-0
No expected impact on existing and
developing hospital-based provider
contracts, joint ventures and other physician
contracts and agreements
• Status quo would not impact existing and
developing hospital-based provider
contracts, joint ventures and other physician
contracts and agreements
• Expertise and support for various provider • NHRMC offers affiliation for independent
alignment models including ACO / CIN providers through Physician Quality Partners
membership, shared investments and co- ACO
management agreements
• Willingness to extend additional support to
independent providers including: EMR
connectivity, referral management
connectivity, technical consulting, analytics,
and a group purchasing organization
• Inclusion of independent providers in key
leadership roles throughout the organization
Physician council enables communication
with independent providers
26
• Restructuring to a SystemCo model will not
directly improve NHRMC's ability to engage
independent providers. Capabilities remain
as status quo
NNew Hanover
�1 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo Systemco
Q1 — O
• Expressed willingness to share best
practices from each organization and scale
to system
• Partners offer access to standardized quality
improvement approach and resources
including quality analytics and scorecard;
care redesign teams; participation in system-
wide quality and safety team
• Partners provide access to care
management and patient satisfaction
resources
• Inclusion in performance improvement
programs including access to preventive
guidelines, evidence based protocols and
safety initiatives
Implementation of embedded workflow and
analytics and access to system -wide
innovation efforts
Demonstrated success, through provider
testimonials, of arming providers with
actionable data
27
• NHRMC launched clinical transformation
programming with varying degrees of
adoption and designed future -state clinical
transformation initiative. Program build time
expected to be 3+ years
• In implemented programs, NHRMC has seen
success but number and scope of programs
are limited
• Current care coordination system is
fragmented with limited coordination across
the continuum; some programs exist and
there are ongoing efforts to increase
coordination
• Current care coordination initiatives include:
Chronic Case Management, Transitional
Case Management, outreach to high-risk
patients post discharge, Surgical Navigation
Center, and Dosher, Novant, and Columbus
clinical affiliation agreements
• Restructuring to a SystemCo model will not
directly improve NHRMC's ability to achieve
clinical transformation. Capabilities remain
as status quo.
NNew Hanover ( ;I
�1 Regional Medical Center
Partnership
4-•
Respondents have nationally recognized
programs for specialized services, including
pediatrics, oncology, cardiac and vascular
care, which could be linked with NHRMC
programs to further advance care available
locally.
• Integration could facilitate timely and I
coordinated transfers 24/7 via transfer center
connectivity
• 2 -way communication between providers
and linked EMR to ensure the coordination of
care leaving the service area
• Partners offer commitment to grow
specialized services and access to clinical
trials locally by augmenting and supporting
existing capabilities with nationally
recognized clinical programs.
11
■ New Hanover
11 Regional Medical Center
Status Quo
N/A
• NHRMC service area population will not
support certain highly -specialized services
• NHRMC has no current partnership to
ensure patient access and coordination to
those highly -specialized services not
supported by service area population
• Some informal relationships for higher levels
of care exist (i.e., pediatric subspecialists
from UNC -CH to supplement our providers)
11
- New Hanover
11 Regional Medical Center
Systemco
N/A
• Restructuring to a SystemCo model will not
directly impact NHRMC's partnerships for
highly -specialized services. Capabilities
remain as status quo
J
NNew Hanover (=j
11 Regional Medical Center
■�� New Hanover 11 New Hanover
Partnership �1 Regional Medical Center 11 Regional Medical Center
Status Quo Systemco
QI
Respondents offer demonstrated experience
in identifying and achieving synergies
through partnership
Partners provide comprehensive frameworks'
for integration and achieving savings
• NHRMC could benefit from cost savings and
operational efficiencies through economies
of scale.
• Partners offer mature corporate service
offerings to augment existing back office
capabilities.
29
N/A
• Status Quo does not introduce new
operational and financial synergies.
N/A
• Restructuring to a SystemCo model is not
expected to result in financial performance
benefits given (1) there is no new access to
corporate services, scale or other
operational/shared resources and
(2) limitations will remain in term of
NHRMC's investment portfolio. Therefore,
there are no expected operational and
financial synergies resulting from a
restructuring.
NNew Hanover
�1 Regional Medical Center
Partnership
■�� New Hanover
11 Regional Medical Center
Status Quo
�r New Hanover
11 Regional Medical Center
SystemCo
(0-0
N/A
N/A
• All potential partners proposed significant
• NHRMC's capital capacity at its current
• Restructuring to a SystemCo model adds
capital commitments to fund all or some of
rating level is insufficient to fund the
ability to more freely raise capital but does
NHRMC's strategic plan.
community's needs.
not materially change NHRMC's capital
• Demonstrated ability to fund capital
• NHRMC is limited to using debt capacity
capacity or short-term financial positioning at
commitments at a lower cost of capital given
within New Hanover County while the most
its current rating level. SystemCo may be
strong balance sheets and highest credit
urgent need for more services and access to
able to use debt capacity outside the County.
rating category
medical care is outside the County.
• Funding shortfalls could require a tax
• Funding shortfalls could require a tax
increase for New Hanover County citizens.
increase for New Hanover County citizens.
30 !fir New Hanover=1
�1 Regional Medical Center
All potential partners proposed significant
capital commitments to fund all or some of
NHRMC's strategic plan for meeting the
healthcare needs of the region.
• All potential partners proposed significant
financial consideration to New Hanover
County.
• Combined capital commitment and financial
consideration create a transformative
opportunity for our community without
significant loss of local control.
31
Status Quo does not result in additional
financial consideration from outside parties
Restructuring to a SystemCo model does not'
offer financial consideration
NNew Hanover
�1 Regional Medical Center
■�� New Hanover
11 Regional Medical Center
1j
�r New Hanover
11
Partnership
Regional Medical Center
Status Quo
Systemco
-�
N/A
N/A
All potential partners proposed significant
capital commitments to fund all or some of
NHRMC's strategic plan for meeting the
healthcare needs of the region.
• All potential partners proposed significant
financial consideration to New Hanover
County.
• Combined capital commitment and financial
consideration create a transformative
opportunity for our community without
significant loss of local control.
31
Status Quo does not result in additional
financial consideration from outside parties
Restructuring to a SystemCo model does not'
offer financial consideration
NNew Hanover
�1 Regional Medical Center
■�� New Hanover 11 �r New Hanover
Partnership + �1 Regional Medical Center 11 Regional Medical Center
I Status Quo Systemco
QI— O
Partners expressed intent to grow NHRMC
operations into a larger, regional healthcare
system, expanding NHRMC's capabilities to
serve as the main tertiary and quaternary
care center for the larger region
• NHRMC has cultivated strong relationships
and partnerships with other acute care
providers in the region and has several joint
ventures to provide care across the
continuum
NHRMC would be included in an integrated '-Status quo would continue the Management
health system with strong presence in North
Carolina
• Support for maintaining NHRMC's
Management Services Agreement with
Pender and other partners in the service
area
• Flexible approach to unified branding
strategy with the anticipation that partner
brand will increase brand awareness
Partners provide access to clinical,
operational, and financial resources to
manage healthcare on a regional basis
Potential expansion into new geographies to
increase size of NHRMC
32
Services Agreement and Clinical Affiliation
with Pender Memorial Hospital
• NHRMC is constrained in its ability to pursue
partnerships outside of New Hanover County,
• Restructuring to a SystemCo model may
ease limitations on forming partnerships
outside New Hanover County, but NHRMC
would still be in the same financial position,
and would need access to additional capital
in order to pursue investments outside the
County
NNew Hanover ( ;I
�1 Regional Medical Center \ i
Partnership
WWI
Proposals range in governance models.
Board may be subject to governmental
control through County nominations or self-
perpetuating subject to partner approval
depending upon partner chosen
• New board expected to have self governing
or other mechanism to ensure adherence to
governance best practices (e.g., attendance,
education, broad skillsets, diverse
representation, etc.)
Participation in system level governance
through locally held, system level board
seats
33
11
■ New Hanover
11 Regional Medical Center
Status Quo
0
11
- New Hanover
11 Regional Medical Center
Systemco
• Current model does not include a process for,• Depending on the revised agreement with
addressing skill -set needs and voids among
the NHRMC Board
i• Political board member appointment process
• Limited ability to self govern and ensure
adherence to best practices (e.g.,
attendance, education, broad skillsets,
diverse representation, etc.)
the County, restructuring to a SystemCo
model might allow the NHRMC Board to
appoint, or have more of a voice with respect
to the appointments of, at least a few of the
NHRMC Board members in order to help
address skill -set needs and voids on the
NHRMC Board
• Political board member appointment process
• Limited ability to self govern and ensure
adherence to best practices (e.g.,
attendance, education, broad skillsets,
diverse representation, etc.)
NNew Hanover
�1 Regional Medical Center
• Partners offer high level of local control.
I• Majority of NHRMC Board members would
be local residents
• Local NHRMC Board will retain oversight of
and fiduciary responsibility for NHRMC, with
partner maintaining specified reserved
powers
• NHRMC will have representation on the
system board to help shape overall direction
and ensure SENC's needs continue to be
advanced.
• Participation in system level governance
through locally held, system level board
seats.
34
• The current model ensures NHRMC's Board '• Control at the local level would continue
remains tied to local County Commissioners. following a restructuring to a SystemCo
,• Political board member appointment process model
• Political board member appointment process
NNew Hanover
�1 Regional Medical Center
1j
■�� New Hanover
11 Regional Medical Center
�r New Hanover
11
Partnership
Regional Medical Center
Status Quo
Systemco
QI
•
• Partners offer high level of local control.
I• Majority of NHRMC Board members would
be local residents
• Local NHRMC Board will retain oversight of
and fiduciary responsibility for NHRMC, with
partner maintaining specified reserved
powers
• NHRMC will have representation on the
system board to help shape overall direction
and ensure SENC's needs continue to be
advanced.
• Participation in system level governance
through locally held, system level board
seats.
34
• The current model ensures NHRMC's Board '• Control at the local level would continue
remains tied to local County Commissioners. following a restructuring to a SystemCo
,• Political board member appointment process model
• Political board member appointment process
NNew Hanover
�1 Regional Medical Center
■�� New Hanover �r New Hanover
Partnership �1 Regional Medical Center �1 Regional Medical Center
Status Quo SystemCo
UZI
Legal organizational model varies among
proposals but all respondents are North
Carolina based not for profits
35
0
0
The current model limits, among other things,'-
Restructuring to a SystemCo model could
(i) investments outside New Hanover
potentially ease the limitations on investing
County, (ii) borrowing options, (iii) access to
outside New Hanover County and borrowing,
other capital, (iv) the types of investments
and could potentially ease some of the other
NHRMC may make with excess cash, (v)
limitations
ability to scale, and (vi) branding
,• The simple act of restructuring to SystemCo,
opportunities
however, would not — on its own — address
the needs impacted by the current limits, as
NHRMC would still be in the same financial
position, and would need access to
additional capital in order to pursue
investments outside the County and to scale,
for example.
NNew Hanover
�1 Regional Medical Center
Non Partnership Options Status Quo Restructuring
Provides access to people, processes, and technology y x
to achieve implementation of strategic needs x
Increases NHRMC's capital capacity to fully fund the x
strategic plan
Retains local governance of NHRMC V V
36 N New Hanover
�1 Regional Medical Center A�,��
osin . . . . . . . . . .
xy
•i.'_
s .
[ f• i
z
'
lw F
at
11 h
New Hanover -
�1 Regional Medical Center
Hi.�3Yifsihx 1�r!".4 aft -,<
Where we are
New Hanover County and New
Hanover Regional Medical
Center leaders saw a need to
explore options based on an
assessment of N H RMC's current
limitations in meeting the needs
of the rapidly growing region.
This assessment led to the
formation of the Partnership
Advisory Group, which has spent
several months on a thorough
process to explore the needs and
options for the future.
NNew Hanover
�1 Regional Medical Center
W
We have three paths
in front of us:
1 Status Quo
Continue what we're doing — but face
financial pressures down the road, with
fewer options to expand and deliver for
our patients and community.
2 Restructure
Explore new ways of structuring our
operations, but not make a material change
in our ability to expand, raise new funds or
deliver for our patients and community.
3 Find a Partner
Take advantage of an opportunity to bring
transformational change to NHRMC and
the community through a partnership with
a leading health system.
Securing a healthier future for you,
your children, your grandchildren, andJP
the community for years to come
Care that helps ensure everyone has a
chance to be well
Nationally recognized health equity
programs working in our communities to
identify, target and eliminate disparities
39
N New Hanovele
r=j
�1 Regional Medical Center `'�,��
F
AI
I
s
N New Hanovele
r=j
�1 Regional Medical Center `'�,��
More care options, when and where you
need them
The backing to withstand changes and
storms
Local people choosing the care our
neighbors need
Economic investment that helps our
community thrive
A
40 N New Hanover-(,
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