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Lawmakers weigh more oversight of UNC Health Care

Posted April 10, 2012 11:54 a.m. EDT
Updated April 10, 2012 7:41 p.m. EDT

— State lawmakers on Tuesday considered a proposal that would give them more control over UNC Health Care and require the hospital system to provide more indigent care.

The Republican-led House Select Committee on State-Owned Assets was supposed to consider the sale of some of the state's more than 11,000 assets. Instead, the panel narrowly approved the nine-page draft bill that would radically alter the operations of the Chapel Hill-based hospital system.

The move allows the General Assembly to consider the move in the legislative session that starts in May, but Senate leaders have already said the bill would be dead on arrival.

Sen. Rules Chairman Tom Apodaca, R-Henderson, said he plans to bury the bill in the his committee if it makes it through the House.

"I just think it’s basically a solution looking for a problem," Apodaca said. "I haven’t seen any real problems in the university hospital system. I think they do an excellent job, I think they save the state a lot of money. I think this bill went way too far."  

The legislation would put the UNC Board of Governors in charge of UNC Health Care; require the hospital system to obtain legislative approval for most business transactions, including any expansion or purchases; require more public disclosure of the system's finances; require UNC hospitals and clinics to provide a proportional amount of care for low-income patients in counties where they're located; and change the system's mission from patient care and medical research to focus on training doctors.

Many members of the House committee said they didn't even know what the bill did before they voted on it. Rep. Julia Howard, R-Davie, said she doubted the committee had the power to rewrite the governance of the UNC system. She said she would prefer to delay the vote.

"I don't want to be (former U.S. House Speaker) Nancy Pelosi (and) vote on something and figure out what's in it after we do it," said Howard, senior chairwoman of the House Finance Committee.

But Rep. Marilyn Avila, R-Wake, said the state shouldn't be in the health care business.

"The state may find itself in a position we really don't want to be in – that's a market that we hold an unfair advantage in against some of the competition," Avila said.

Rep. Tim Moffett, R-Buncombe, handled the bill in committee, but later said he authored only the governance changes. The rest of the proposal, from limiting expansion to requiring more charity care, he said, “was a collection of recommendations that came from different members, and I’m not sure what members made what recommendations.”

UNC Health Care officials said they plan to fight the legislation, saying it would wind up costing taxpayers money.

"When doctors become doctors, they take an oath to first do no harm. This bill does harm," said Kevin FitzGerald, chief of staff for UNC Health Care.

“There’s a belief, I think – and an incorrect belief – that government should not be delivering healthcare," FitzGerald added. "The reality is that healthcare is very much dependent upon public support, taxpayer support."

FitzGerald said university hospitals are the people's hospitals across the state, and the proposed changes would mean less access for patients.

Senator Tom Apodaca conceded some tweaks to the UNC Hospital system might be in order, particularly making the board of governance more transparent. “But making them come to us to purchase another hospital or another practice? It’s just way too much.”

UNC Hospitals signed a management contract with Apodaca’s local hospital, Pardee Hospital in Hendersonville. “Every response I’ve gotten back from my local hospital has been outstanding,” he said. “It’s really helped serve my constituents."

Lawmakers have been examining UNC Health Care since last year, when WakeMed made a $750 million bid for crosstown rival Rex Healthcare, which UNC has operated since 2000.

WakeMed officials have charged that Rex's state ownership provides it with unfair advantages, including taxpayer subsidies and a higher reimbursement for Medicaid care than WakeMed receives. They also say Rex doesn't treat many uninsured patients, shifting most of the county load to WakeMed.

UNC Health Care officials dispute those charges, claiming that Rex has shifted about $2 million a year to the UNC hospital system over the last decade. Also, they said, UNC and Rex together provide $300 million in charity care a year, which is about double WakeMed's level.

A bill forcing UNC to sell Rex to WakeMed was also put before the committee Tuesday by Rep. Bill Brawley, R-Mecklenburg, but lawmakers declined to even discuss it, let alone vote on it.