Meeting #15 - nhrmcfuture.org · 18-06-2020 · traditional healthcare services and recent recruitment has included new expertise (i.e., clinical transformation and health plan operations)

New Hanover County Partnership Advisory Group

Meeting #15

June 18, 2020

22

Section Page Number

1. Welcome 3

2. Consideration of Pursuing a Partnership vs. Status Quo or Restructuring 4

3. Closed Session -

4. Closing Remarks 43

TABLE OF CONTENTS

3

WELCOME

4

CONSIDERATION OF PURSUING A

PARTNERSHIP VS. STATUS QUO OR

RESTRUCTURING

55

THE PARTNERSHIP ADVISORY GROUP HAS ENGAGED IN

SIGNIFICANT WORK OVER THE PAST 9 MONTHS

SUPPORTED BY A MULTIDISCIPLINARY TEAM OF NHRMC

AND COUNTY LEADERSHIP AND OUTSIDE ADVISORS

WHAT WE DID • UNDERSTOOD THE CHARGE AS AN ADVISORY GROUP TO THE NHRMC AND COUNTY BOARDS

• REVIEWED THE CURRENT HEALTHCARE LANDSCAPE AND NHRMC’S STRATEGIC OUTLOOK

• DEVELOPED THE GOALS AND OBJECTIVES FOR THE PARTNERSHIP EXPLORATION PROCESS

• ASSESSED THE FEASIBILITY OF NHRMC REMAINING STATUS QUO OR RESTRUCTURING

• REVIEWED PROPOSALS AND ENGAGED WITH RESPONDENTS TO ASSESS PARTNERSHIP OPTIONS

2 MEETINGS

21 COMMUNITY MEMBERS, NHRMC TRUSTEES,

PHYSICIANS, COUNTY AND NHRMC LEADERSHIPWHO WE ARE:

TO UNDERSTAND

NHRMC AND THE

INDUSTRY

TRANSITION IN

HEALTHCARE

TO DEFINE

GOALS AND

OBJECTIVES AND

DEVELOP AN RFP

TO UNDERSTAND

RESTRUCTURING

OPTION &

STRATEGIC

OUTLOOK

TO ASSESS THE

PROPOSALS

RECEIVED IN

RESPONSE TO

THE RFP

5 WORK

GROUPS

ASSESSING STATUS QUO,

RESTRUCTURING, AND

PARTNERSHIP

WITH THE RESPONDENTS

TO UNDERSTAND FIT AND

CONDUCT DUE DILIGENCE

12 SITE

VISITS

PUBLIC PRESENTATIONS

BY EACH RESPONDENT TO

THE PAG

TIME LISTENING TO THE

COMMUNITY, NHRMC

EMPLOYEES & PROVIDERS

4 MEETINGS 4 MEETINGS 4 MEETINGS

14 PAG Meetings over 9 MonthsAnd counting!

And Countless Hours Spent on Homework and Reading

Industry Articles and Information Shared by the Public

66

THIS PROCESS DATES BACK TO 2017 WITH THE

DEVELOPMENT OF NHRMC’S CURRENT STRATEGIC PLAN

Oct Nov Dec Jan Feb Mar Apr May JunNHRMC Board develops

and approves current

strategic plan with

focus on access, value,

and health equity

After fully vetting

option, NHRMC

BOT determines

SystemCo

restructuring

offers limited

value and

begins

partnership

discussion;

Works with

Commissioners

to establish

PAG

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?

2017 2018 2019 2020

PAG understands

NHRMC current state

and healthcare industry

transformation

PAG understands

proposals and evaluates

value to NHRMC and

the community

PAG evaluates NHRMC

Strategic Outlook

including impact of

SystemCo

PAG develops

comprehensive Goals

and Objectives and

issues RFP

77

STEP 1: UNDERSTAND CURRENT STATE

What’s happening in

Wilmington and NHRMC’s 7-

County Service Area?

What challenges are faced by

NHRMC in today’s healthcare

landscape?

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)

Columbus

+0%

Duplin

-2%

Onslow +10%

Brunswick

+21%

Bladen

-6%

Pender

+16%

New

Hanover+15%

<10%NHRMC Inpatient

Capacity

NHRMC is influenced by national healthcare trends and shifting market dynamics

88

STEP 2: DEFINE OUR GOALS AND OBJECTIVES

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

strategic option 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

The Guiding Principles serve as a framework of desired outcomes across key

dimensions (i.e. operational, clinical, etc.) to guide the partnership exploration

process

Our goal in this process is to better position NHRMC to achieve its strategic

plan

Strategic Plan

Goals and

Objectives

Request for

Proposal

Guiding

Principles

99

STEP 3: ASSESS THE STRATEGIC OUTLOOK

Strategic Outlook Factors Conclusion

Determine if NHRMC is positioned to achieve its

strategic plan

The combined implementation complexity and

financial demand of all strategic needs inhibits

NHRMC’s ability to optimally address each of

these demands at the required pace

Understand NHRMC’s legal organizational

structure

NHRMC has structural barriers to achieving its

strategic plan, adapting to healthcare industry

transformation, and achieving governance best

practices

Evaluate NHRMC’s long-range financial plan

and ability to fund capital needs

Funding the strategic plan would stress NHRMC’s

balance sheet potentially resulting in default on

bonds or downgrade in credit rating approaching

‘Baa’

Discuss alternative scenarios, such as tax payer

funding, to fund NHRMC’s capital needs while

maintaining current legal organizational structure

Tax support to fill existing financial gaps would

translate to a 21% increase in property tax rates;

up to 68% increase inclusive of potential threats

1010

STEP 4: UNDERSTAND PROS AND CONS OF PROPOSED

PARTNERSHIP MODELS

Pros and Cons based upon understanding of proposals received

Pros Cons

Joint Venture Full Integration Joint Venture Full Integration

Ownership

InterestMaintain ownership interest

Receive maximum

consideration and

commitments include fully

funding Strategic Plan

Lower amount of

consideration paid and

commitments made by

partner for partial ownership

Relinquish ownership

interest

Board Powers Maintain role in governance Maintain role in governanceSubject to partner “veto

rights / reserved powers”

Subject to parent reserved

powers

Board

AppointmentAppointment of directors to

governing board

Appointment of directors to

governing board

Partner gets appointments to

governing board

Partner has more limited role

in appointments

Capital

CommitmentPotential opportunity for

distributions

No further capital

commitments

Ongoing commitment to

contribute capital if required,

or risk dilution

Few, if any, opportunities to

participate in ongoing

distributions

Return on

InvestmentPotential future returns on

investment

Full ROI achieved at closing /

Maintain right of reversion /

No ongoing debt obligations

or downside risk

Responsibility for at least a

part of ongoing debt and

downside risk

Likely no participation in any

future returns

Organizational

DirectionAbility to influence strategy

Partner has full incentive to

invest / Retain ability to

influence strategy through

local board and parent board

appointments

Less incentive for partner to

prioritize investments in

venture

Reduced ability to control

strategy

1111

STEP 5: DEVELOP KEY PROPOSAL ELEMENTS (KPE) TO

EVALUATE OUR OPTIONS (1/2)

Goal & Objective Key Proposal ElementSummary Approach: Extent to which the

proposal addresses…

Improving Access to Care and Wellness

1. Expansion & Reconfiguration of

Facilities

Strategic Need(s): Expansion & Reconfiguration of

Facilities

2. Ambulatory Network Development Strategic Need(s): Ambulatory Network Development

3. Information Technology & Digital

Solutions

Strategic Need(s): Transparency; Consumer-Friendly

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

Achieving Health Equity 5. Full-Scale Health Equity ProgramStrategic Need(s): Full-Scale Health Equity Program;

Fulfills commitment to mission and serving all regardless of

ability to pay

Supporting our Staff

6. Avoiding Staff Shortages Strategic Need(s): Avoiding Staff Shortages

7. Developing and Recruiting Talent and

Expertise

Strategic Need(s): Developing and Recruiting Talent and

Expertise

Partnering with Providers

8. Provider Needs Strategic Need(s): Provider Needs

9. Engaging Independent Providers Strategic Need(s): Engaging Independent Providers

Driving Quality Care Throughout the

Continuum10. Clinical Transformation

Strategic Need(s): Evidenced-Based Protocols; Care

Coordination Across the Continuum

1212

STEP 5: DEVELOP KEY PROPOSAL ELEMENTS (KPE) TO

EVALUATE OUR OPTIONS (2/2)

Goal & Objective Key Proposal ElementSummary Approach: Extent to which the

proposal addresses…

Growing the Level and Scope of Care11. Partnerships for Highly-Specialized

Services

Strategic Need(s): Partnerships for Highly-Specialized

Services

Investing to Ensure the Long-Term

Financial Security

12. Financial performance benefitsStrategies to identify and capture synergies with potential

partner and preserve key existing financial drivers

13. Addressing financial gaps and threatsAbility to fund strategic plan to address NHRMC’s existing

financial gaps and potential threats

14. Total financial considerationTotal financial consideration commensurate to proposed

strategic partnership structure

Strategic Positioning 15. Integrated, Regional Health SystemStrategic Need(s): Integrated, Regional Health System;

Broader desire to positively impact region’s economic

status

Governance

16. Contemporary governance model Barrier(s) identified by NHRMC BOT: Diplomatic Hurdles

17. Control at the local levelPreservation of majority control of the organization at the

local level

18. Legal organizational modelBarrier(s) identified by NHRMC BOT: Growth Outside the

County; Branding Inflexibility; Financing Opportunity;

Investment Limitations; Scale Limitations

13

KEY PROPOSAL ELEMENTS

1414

KEY PROPOSAL ELEMENT OVERVIEW

• 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

1515

●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,

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

manner, lacking sufficient support for achieving the KPE.

N/A No response provided for this KPE.

KPE SUMMARY PROVIDES HARVEY BALL RATINGS BASED ON

THE FOLLOWING CRITERIA

1616

Key Proposal Elements Partnership

Driving Quality Care Throughout the Continuum

10. Clinical

Transformation ◕-● ◔ ◔Growing the Level and Scope of Care

11. Partnerships for

Highly-Specialized

Services◕-● ○ ○

Investing to Ensure the Long-Term Financial Security

12. Financial

Performance Benefits ◕-● N/A N/A

13. Addressing Financial

Gaps and Threats ◕-● ○ ◔14. Total Financial

Consideration ◑-● N/A N/A

Strategic Positioning

15. Integrated, Regional

Health System ◕-● ◔ ◔Governance

16. Contemporary

Governance Model ◔-◕ ○ ◔17. Control at the Local

Level ◕ ● ●18. Legal Organizational

Model ◑-◕ ○ ◑

Key Proposal Elements Partnership

Improving Access to Care and Wellness

1. Expansion &

Reconfiguration of

Facilities◕-● ◔ ◔

2. Ambulatory Network

Development ◕-● ◔ ◔3. Information

Technology ◑-● ◔ ◔Advancing the Value of the Care

4. ACO and Health Plan

Development ◕-● ◔ ◔Achieving Health Equity

5. Full-Scale Health

Equity Program ◕-● ◔ ◔Supporting our Staff

6. Avoiding Staff

Shortages ◕-● ◑ ◑7. Developing and

Recruiting Talent and

Expertise◕-● ◔ ◔

Partnering with Providers

8. Provider Needs ● ◔ ◔9. Engaging

Independent

Providers◑-● ◔ ◔

PARTNERSHIP VS. STATUS QUO OR RESTRUCTURINGKEY PROPOSAL ELEMENT SUMMARY & COMPARISON

1717

KPE SUPPORTING RATIONALE1. EXPANSION AND RECONFIGURATION OF FACILITIES

1. Expansion and Reconfiguration of Facilities

Partnership

◕-● ◔ ◔• 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

• Develop and upgrade the main

campus to expand tertiary/quaternary

capabilities

• Develop innovative and sustainable

health delivery models in rural

communities

• Partners offer advanced methodology to

identify where services are most needed and

the capital, scale and infrastructure to more

rapidly act on that information.

• 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.

• NHRMC has had success in driving down

hospital utilization rates among existing

patients (e.g., 14% reduction in Medicare

admission rate).

• Focused efforts on reducing need for

hospital services are not able to keep pace

with increasing capacity demands.

• Long-term regional growth is expected to

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.

• 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

1818

KPE SUPPORTING RATIONALE2. AMBULATORY NETWORK DEVELOPMENT

2. Ambulatory Network Development

Partnership

◕-● ◔ ◔• 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.

• Robust ambulatory strategy

supported/funded by partnership would help

decompress main NHRMC campus, allowing

for more focused use for high-end services.

• 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,

including telemedicine and behavioral health.

• The growth of NHRMC’s ambulatory network

to meet projected growth in outpatient

volumes and provide more convenient,

affordable care options is restrained by

structural and capital limitations inherent in

existing structure. These include the ability to

invest in facilities outside New Hanover

County, where more than 50% of NHRMC

patients live.

• NHRMC has purchased land for the Scotts

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.


ease limitations on investing in facilities and

services outside New Hanover County, but



additional capital (this could be limited) in

order to pursue investments outside the

County.

1919

KPE SUPPORTING RATIONALE3. INFORMATION TECHNOLOGY

3. Information Technology

Partnership

◑-● ◔ ◔• 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.

• 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

(~$1M/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.

2020

KPE SUPPORTING RATIONALE4. ACO AND HEALTH PLAN DEVELOPMENT

4. ACO and Health Plan Development

Partnership

◕-● ◔ ◔• 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.

• 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.


directly improve NHRMC’s ACO and health

plan development capabilities. Capabilities

remain as status quo.

2121

KPE SUPPORTING RATIONALE5. FULL-SCALE HEALTH EQUITY PROGRAM

5. Full-Scale Health Equity Program

Partnership

◕-● ◔ ◔• All respondents demonstrated success in

addressing social determinants of health and

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.

• Current NHRMC programs include Mission

Corps, Barbershop Initiative, Food

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.


directly impact or expand NHRMC’s health

equity program. Capabilities remain as status

quo

2222

KPE SUPPORTING RATIONALE6. AVOIDING STAFF SHORTAGES

6. Avoiding Staff Shortages

Partnership

◕-● ◑ ◑• 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

with NHRMC to develop a competitive

retirement savings program.

• 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.

• 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).

• Partnership with Schools of Nursing and

national recruitment efforts support a growing

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.


directly improve NHRMC’s staff job security,

benefits, or recruitment. Capabilities remain

as status quo.

2323

KPE SUPPORTING RATIONALE7. DEVELOPING AND RECRUITING TALENT AND EXPERTISE

7. Developing and Recruiting Talent and Expertise

Partnership

◕-● ◔ ◔• Respondents have system-level leadership

development; orientation & onboarding;

learning technology; more sophisticated

succession planning; onboarding, coaching,

and education;

• Leadership recruitment support

• Specific programs for developing nurse

leadership

• Location of a new shared-services center

and corporate department in Wilmington.

• 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.


directly improve NHRMC’s ability to develop

and recruit talent and expertise. Capabilities

remain as status quo.

2424

KPE SUPPORTING RATIONALE8. PROVIDER NEEDS (1/2)

8. Provider Needs

Partnership

● ◔ ◔• 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.

• Support for the development of a NHRMC

Advance Practice Provider strategy

• 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

• 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)

• Overall APP’s are ~1/3 of the NHRMC

provider workforce with expected expansion

of recruitment

• NHRMC achieved Joy in Medicine Bronze

Level Designation for NHRMC Physician

Group and developed and administered a

MiniZ provider burnout survey


directly improve NHRMC’s ability to support

provider needs. Capabilities remain as status

quo

Provider Needs Rating Rationale continued on subsequent page

2525

KPE SUPPORTING RATIONALE8. PROVIDER NEEDS (2/2)

8. Provider Needs

Partnership

● ◔ ◔• 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

organizations

• 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

2626

KPE SUPPORTING RATIONALE9. ENGAGING INDEPENDENT PROVIDERS

9. Engaging Independent Providers

Partnership

◑-● ◔ ◔• No expected impact on existing and

developing hospital-based provider

contracts, joint ventures and other physician

contracts and agreements

• Expertise and support for various provider

alignment models including ACO / CIN

membership, shared investments and co-

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

• Status quo would not impact existing and

developing hospital-based provider

contracts, joint ventures and other physician

contracts and agreements

• NHRMC offers affiliation for independent

providers through Physician Quality Partners

ACO


directly improve NHRMC’s ability to engage

independent providers. Capabilities remain

as status quo

2727

KPE SUPPORTING RATIONALE10. CLINICAL TRANSFORMATION

10. Clinical Transformation

Partnership

◕-● ◔ ◔• 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

• 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


directly improve NHRMC’s ability to achieve

clinical transformation. Capabilities remain

as status quo.

2828

KPE SUPPORTING RATIONALE11. PARTNERSHIPS FOR HIGHLY-SPECIALIZED SERVICES

11. Partnerships for Highly-Specialized Services

Partnership

◕-● N/A N/A

• 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

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.

• 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)


directly impact NHRMC’s partnerships for

highly-specialized services. Capabilities

remain as status quo

2929

KPE SUPPORTING RATIONALE12. FINANCIAL PERFORMANCE BENEFITS

12. Financial Performance Benefits

Partnership

◕ N/A N/A

• 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.

• Status Quo does not introduce new

operational and financial synergies.

• 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.

3030

KPE SUPPORTING RATIONALE13. ADDRESSING FINANCIAL GAPS AND THREATS

13. Addressing Financial Gaps and Threats

Partnership

◑-● N/A N/A

• All potential partners proposed significant

capital commitments to fund all or some of

NHRMC’s strategic plan.

• Demonstrated ability to fund capital

commitments at a lower cost of capital given

strong balance sheets and highest credit

rating category

• NHRMC’s capital capacity at its current

rating level is insufficient to fund the

community’s needs.

• NHRMC is limited to using debt capacity

within New Hanover County while the most

urgent need for more services and access to

medical care is outside the County.

• Funding shortfalls could require a tax

increase for New Hanover County citizens.

• Restructuring to a SystemCo model adds

ability to more freely raise capital but does

not materially change NHRMC’s capital

capacity or short-term financial positioning at

its current rating level. SystemCo may be

able to use debt capacity outside the County.

• Funding shortfalls could require a tax

increase for New Hanover County citizens.

3131

KPE SUPPORTING RATIONALE14. TOTAL FINANCIAL CONSIDERATION

14. Total Financial Consideration

Partnership

◑-● N/A N/A


capital commitments to fund all or some of

NHRMC’s strategic plan for meeting the

healthcare needs of the region.


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.

• Status Quo does not result in additional

financial consideration from outside parties.

• Restructuring to a SystemCo model does not

offer financial consideration

3232

KPE SUPPORTING RATIONALE15. INTEGRATED, REGIONAL HEALTH SYSTEM

15. Integrated, Regional Health System

Partnership

◕-● ◔ ◔• 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 would be included in an integrated

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

• 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

• Status quo would continue the Management

Services Agreement and Clinical Affiliation

with Pender Memorial Hospital

• NHRMC is constrained in its ability to pursue

partnerships outside of New Hanover County


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

3333

KPE SUPPORTING RATIONALE16. CONTEMPORARY GOVERNANCE MODEL

16. Contemporary Governance Model

Partnership

◔-◕ ○ ◔• 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

• Current model does not include a process for

addressing skill-set needs and voids among

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.)

• Depending on the revised agreement with

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


• Limited ability to self govern and ensure

adherence to best practices (e.g.,

attendance, education, broad skillsets,

diverse representation, etc.)

3434

KPE SUPPORTING RATIONALE17. CONTROL AT THE LOCAL LEVEL

17. Control at the Local Level

Partnership

◕ ● ●• Partners offer high level of local control.

• 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.

• The current model ensures NHRMC’s Board

remains tied to local County Commissioners.


• Control at the local level would continue

following a restructuring to a SystemCo

model


3535

KPE SUPPORTING RATIONALE18. LEGAL ORGANIZATIONAL MODEL

18. Legal organizational model

Partnership

◑-◕ ○ ◑• Legal organizational model varies among

proposals but all respondents are North

Carolina based not for profits

• The current model limits, among other things,

(i) investments outside New Hanover

County, (ii) borrowing options, (iii) access to

other capital, (iv) the types of investments

NHRMC may make with excess cash, (v)

ability to scale, and (vi) branding

opportunities

• Restructuring to a SystemCo model could

potentially ease the limitations on investing

outside New Hanover County and borrowing,

and could potentially ease some of the other

limitations

• The simple act of restructuring to SystemCo,

however, would not – on its own – address

the needs impacted by the current limits, as



additional capital in order to pursue

investments outside the County and to scale,

for example.

3636

CONCLUSION: RESTRUCTURING RETAINS LOCAL CONTROL

BUT DOES NOT SUPPORT ACHIEVING THE REGION’S NEEDS

Non Partnership Options Status Quo Restructuring

Provides access to people, processes, and technology

to achieve implementation of strategic needs X X

Increases NHRMC’s capital capacity to fully fund the

strategic plan X X

Retains local governance of NHRMC

3737

3838

WHERE WE ARE:

Where we are

New Hanover County and New

Hanover Regional Medical

Center leaders saw a need to

explore options based on an

assessment of NHRMC’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.

We have three paths

in front of us:

1Continue what we’re doing –– but face

financial pressures down the road, with

fewer options to expand and deliver for

our patients and community.

Status Quo

2Explore 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.

Restructure

3Take advantage of an opportunity to bring

transformational change to NHRMC and

the community through a partnership with

a leading health system.

Find a Partner

3939

Securing a healthier future for you,

your children, your grandchildren, and

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

4040

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

4141

Our Vision

NHRMC is an industry leader in a new

era of healthcare delivery. Our thriving

community serves as a national model

of achieving excellence for all.

Our Mission

Leading our community to

outstanding health

4242

Exceptional quality and personal service

Health and vitality for all

A diverse and extraordinary workforce

Transformation through empowerment,

innovation and inclusivity.

Our Commitments

43

CLOSING REMARKS

4444

CLOSING REMARKS

Thank You

Documents

Meeting #15 - nhrmcfuture.org · 18-06-2020 · traditional healthcare services and recent recruitment has included new expertise (i.e., clinical transformation and health plan operations)