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WakeMed’s proposed merger with Charlotte-based Atrium Health will come to a head Monday, as Wake County commissioners are set to vote on a vastly altered deal from the version they saw in May.
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The new deal would nearly double WakeMed’s indigent care commitment for people who have trouble paying, guarantee that Atrium will invest $2 billion, grant more local control over WakeMed’s board of directors, and restrict certain tactics in medical debt collection.
But the timing of the announced changes — which were negotiated between county attorneys and WakeMed and Atrium’s attorneys in meetings closed to the public — mirrors how the deal was first announced, one opponent of the deal said.
The county announced the new terms of the deal late Thursday evening and commissioners will vote on the agreement during their 2 p.m. session Monday.
“It’s outrageous that the Wake County Board of Commissioners is once again planning a WakeMed vote without giving the public any time to review the substance and get answers to their questions,” said Rob Stephens, organizing director of the Patients Union, in a statement provided to The N&O. “This is exactly what they did in May when they put the transfer agreement on the agenda on a Friday for a Monday vote. Commissioners have told us the process would be more transparent than this.”
Stephens said the county should hold a new public hearing on the significant changes and answer community questions first.
“This process sets a shameful precedent that this community will not quickly forget,” he said.
WakeMed spokesperson Kristin Kelly issued a statement saying: “Following months of discussions with county leaders, community members, community organizations, faith leaders, employees and care providers, we heard many questions about how this combination would benefit Wake County.”
She said the latest commitments as part of the deal “strongly demonstrate the spirit of this proposed combination: to bring together two mission-driven organizations with a shared dedication to clinical excellence, innovation and improving health for all.”
The public will be able to weigh in during a regular public comment session at the Wake County Board of Commissioners meeting at 2 p.m. Monday.
When the merger was initially announced, WakeMed said it included a $2 billion investment from Atrium over 10 years.
Later, WakeMed CEO Donald Gintzig, responding to a letter from the office of Gov. Josh Stein, said not all the money would necessarily come from Atrium. WakeMed could pay some or all of it.
The new updated agreement closes that loophole, and guarantees that Atrium will make the full $2 billion investment, but over 15 years instead of 10.
Kelly characterized it as a clarification.
“We are also adjusting the definitive agreement to clarify that Atrium Health’s $2 billion capital commitment to WakeMed will come from Atrium Health’s own sources of capital over a 15-year period following closing [of the merger],” she wrote.
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As part of the new agreement, the county will get $150 million over 10 years to fund the “Wake County Whole Health Program.”
The agreement says that money will be spent “to improve access to and affordability of care, expand mental health care and address social drivers of health through affordable housing, homelessness solutions and food security.”
Kelly said that Atrium’s money brings “transformative investments in community well-being and is a long-term investment in improving and supporting the health and vitality of Wake County — helping address identified needs that extend beyond the walls of our hospitals and clinics.”
Currently, WakeMed is required by an agreement with Wake County to spend 4.5% of its revenue on indigent care, or care for people who would have trouble paying.
The agreement would bring that requirement to 8%.
But WakeMed actually spends around 12% of its revenue on indigent care currently, more than it is required to.
Gintzig told Stein’s office that number would be hard to maintain.
The agreement also maintains WakeMed’s current commitment to maintain the minimum spending on indigent care or risk its main hospital property reverting back to county ownership.
The new agreement adds a number of provisions on how WakeMed can collect debt. It restricts WakeMed from:
Opponents of the deal have cited Atrium’s past propensity for aggressively pursuing medical debt as a reason not to agree to the deal.
Currently, Wake County appoints eight of WakeMed’s 14 governing board members.
While that has never been a point of contention in the negotiations, what has shifted is how those appointments are made and how board members can be removed.
When the deal was initially announced, the agreement said Atrium could remove WakeMed board members at any time with “cause,” and gave a broad series of reasons that constitute cause.
People also took issue with the fact that Wake County’s appointments would be chosen from a slate of pre-approved candidates chosen by vote of two-thirds of the board.
It’s unclear if the slate of nominees mechanism is changing, but Wake County’s appointments will still require the approval of two-thirds of the board.
But removal of the Wake County-appointed board members rests entirely in the hands of the board. The board must vote by two-thirds to remove such a board member. Previously Atrium could remove a board member without a vote in certain conditions.
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