In a 5-2 vote Monday evening, the Wake County Board of Commissioners gave its blessing for a $2 billion merger between WakeMed and the state’s largest hospital system, Atrium Health.
The vote allows the systems to amend WakeMed’s articles of incorporation and governing documents to transfer control away from the county commissioners to a 14-member board that both Atrium and county leaders would select. Board of Commissioners Chair Don Mial asked sheriffs’ deputies to clear the chamber before the vote after spectators, some of whom had been watching for more than five hours, became disruptive.
“I believe my vote protects WakeMed’s legacy,” said Commissioner Safiyah Jackson before giving an affirmative vote to the merger. “It protects our most vulnerable neighbors, and it guarantees great care for our children and grandchildren.”
WakeMed announced late last week that it had secured a revised agreement with Atrium that brings an additional $150 million to the county over the next decade. The agreement increases WakeMed’s requirement for providing indigent care to a minimum of 8% of its annual adjusted revenue, gives commissioners more control over board appointees, and gives Atrium less power to change WakeMed’s governing documents.
The revised agreement also firms up the language around the $2 billion in capital expenditures that Atrium intends to make in Wake County over the next 10 years, which includes half a billion dollars to WakeMed’s flagship campus in Southeast Raleigh and funding for a new Whole Health Campus that includes a 150-bed mental health hospital in Garner.
Before the vote, Commissioner Cheryl Stallings praised the changes in the deal.
“We have worked diligently over the past couple of weeks to secure a stronger agreement,” Stallings said. “The $2 billion in capital investments will be coming from Atrium, and not WakeMed. There are sound financial assistance policies in place that have already been presented.”
After the proposed deal was quietly placed on the county commissioners’ consent agenda in May and removed following public outcry, WakeMed leaders launched a public information campaign designed to raise confidence in the merger. This summer, patients, residents, and local leaders aired their concerns about the potential increase in health care costs, as well as concerns about the secrecy surrounding the deal and the lack of a competitive bidding process from WakeMed.
North Carolina Gov. Josh Stein was initially critical of the deal, raising concerns about county oversight of the board of directors in a July letter to WakeMed leaders.
But in a press release on Sunday, Stein stated that he no longer opposes the merger following the updates to the terms of the agreement and the addition of a promise from Atrium to cap price increases to no more than 1.5 times the annual increase in Medicare costs for the next five years.
“The proposed transaction between Atrium and WakeMed has improved substantially in recent days,” the statement said. “We need broader health care reform to address rising costs, and I am committed to partnering with the General Assembly to make health care cost less for North Carolinians.”
Other Democratic leaders continue to oppose the merger. In a statement Sunday, the Wake County Democratic Party’s executive council said it opposes the deal. “The Democratic Party is fighting to lower costs for all,” the statement read. “Based on the limited information available to the public, we do not have confidence this proposal accomplishes these goals.”
Before the vote, staff from the county attorney’s office walked the commissioners through changes to WakeMed’s articles of incorporation that make Atrium the sole controlling member of the nonprofit hospital system and provided a summary of the transfer agreement.
The $150 million to the Wake County Whole Health Program will fund public health priorities, including support for placement of foster youth in crisis, homelessness, supportive housing, food security, and senior citizens. The county retains control and flexibility over the funding decisions of that program, the county attorney explained.
Commissioner Vickie Adamson asked the county attorney whether the county is relinquishing control over WakeMed.
“It does mean a significant shift in control, and the board of directors would not be in control like it is now,” the county attorney acknowledged.
Adamson said the board’s consideration over the past four months was not “the usual process of how we do work.” She noted that the price cap Stein announced with Atrium over the weekend was not included in the documents the board was set to vote on today; the county would still have to finalize that agreement, the county attorney confirmed.
Adamson and Commissioner Tara Waters, whose district is home to WakeMed’s flagship campus on New Bern Avenue in Southeast Raleigh, were the two dissenting votes. Waters cited concerns with limited public engagement, the process, Atrium’s aggressive debt-collection track record, and the deal itself as her reasons for voting against the agreement.
“Quite frankly, the plot twists have been nonstop,” she said. “For residents the questions are real: What will this mean for the cost of health care? What will it mean for access to care? What will it mean for the quality of care? Why give up so much local control to a sole member?”
Adamson was more blunt. She said while the deal is much better than it was when it first came to county leaders, the board should reject the agreement and “send it back to WakeMed and get a new board that’s willing to do the hard work, the due diligence, to look at hospitals, do a public process, because we’re in no hurry.”
Before the staff presentation, around 50 people spoke during a public comment period.
Inside the packed chamber, residents wore white T-shirts bearing the words “Save WakeMed,” and holding signs that read “We Will Remember Every November” and “Patients are Watching.” The majority of speakers were against the agreement, calling it a “corporate takeover” of WakeMed and expressing fear over rising health care costs, loss of local accountability, and transparency. Many spoke passionately about the lifesaving care and treatment at WakeMed. Health care workers testified to the decline in quality of care that often comes with such mergers, including higher patient-nurse ratios.
“Patient care suffers, and the already difficult work of nurses and doctors and staff becomes close to impossible,” said Karen Ziegler, a retired nurse. “I have already witnessed how much people struggle, not only to afford their health care but also simply to afford food and rent. Then when the bill collectors come trying to collect … for health care … people are stretched to their limit and beyond.”
Around a dozen commenters, including Atrium employees or WakeMed board members, spoke in favor of the deal.
Satish Garimella, a member of the Morrisville Town Council and WakeMed’s board of directors, talked about being treated at WakeMed for an infection of flesheating bacteria. He praised the county commissioners and staff for their work on the agreement.
“I understand how consequential this decision is for every person, and for thousands upon thousands of families which have their own histories of care that’s tied to WakeMed,” Garimella said. “[Your] work has made the agreement better for the people of the county for whom we are responsible.”
Comment on this story at [email protected].
