Beaufort County's Last Stand | Eastern North Carolina Now

    Barring some last minute miracle by our County Commissioners and/or the Financial Staff at the hospital, we may be faced with having to sign over the facility to UHS. After the short-sighted proponents of UHS drove away the few competitors in the evaluation, the County has been left with little bargaining power during the final stages of the process. With only a handful of chips to play, it is crucial that we invest them wisely, picking the most important places to "dig in our heels".

    The two most important issues facing the Commissioners at this late stage in the negotiations are clearly the price and terms of the buyout option; and the question of Beaufort County's ongoing role in the governance of the hospital.

    The editors and staff at the Beaufort Observer recently completed an excellent future valuation of the hospital, based on current insurance data and a very conservative (3% annual) forward looking increase in its value, arriving at a number in excess of $175,000,000 - a far cry from the almost insulting $10,000,000 included in UHS's last minute proposal. In the absence of negotiating "chips" it is doubtful we can convince them to increase their offer seventeen-fold, however it would not be unrealistic to hold out for a "Fair Market Value" buyout provision at the end of the lease. One other crucial change in this area pertains to which party has the power to exercise the option. UHS is currently proposing that they alone should be allowed to trigger the buyout option, not giving the citizens of Beaufort County any input into the decision at all. If nothing else, this provision should be negotiated to one of MUTUAL AGREEMENT by both parties. Even an unbiased 3rd party arbiter would likely grant these two changes should the final document be submitted to arbitration.

    The second crucial item that needs to be addressed is the one of governance of the hospital, and to some extent the related physician's practices. UHS is made up of a confusing web of an umbrella corporation and dozens of wholly owned subsidiaries, many of whom have some of the same management and overlapping payrolls. The board of directors of the overall UHS organization is made up of 20 individuals, appointed by the UNC Board of Governors and Pitt County Commissioners. According to their website they are responsible for "the articulation of its mission and values, the protection of assets and the quality of services".

    The actual operations of their hospitals (apart from PCMH) are controlled by the seven directors of their top level "East Carolina Health" subsidiary and the same group of individuals sitting as the governing boards of second-level subsidiaries named for the hospitals they manage (e.g., Bertie Hospital falls under "East Carolina Health - Bertie", Heritage Hospital falls under "East Carolina Health - Heritage"", etc.) According to the current UHS proposal, they would create yet another group of subsidiaries, including "East Carolina Health - Beaufort" which would be charged with the governance of what we now call BCMC. This is where it gets interesting. The seven member boards for all these different county hospitals are made up of Dave McRae and six additional members INCLUDING one PITT COUNTY COMMISSIONER (in spite of the fact that PCMH is not included in the ECH subsidiaries. If UHS should take over the operation of the current BCMC, why should a Pitt County Commissioner be a member of the governing body controlling the hospital here in Beaufort County? This is the second area where we need to dig in our heels and insure that we have meaningful input into the future of the facility that most of us look to for our medical care. The Commissioners should insist, as a condition of their approval of the UHS lease that the Board of "East Carolina Health - Beaufort" contains not a Pitt Commissioner but a Beaufort County Commissioner selected by their own members, and NOT subject to approval by Dave McRae or anyone else. This is not an unreasonable request and it would be a safeguard for the people of Beaufort County should "Prince Charming" turn out to be a "Frog" someday in the future. We must not settle for promises of appointments to "Advisory Boards" or other similar powerless groups - we should demand representation on the board actually "calling the shots".