Attorney general places stipulations on major NC hospital deal

January 17, 2019

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HCA’s acquisition of Asheville-based Mission Health’s assets received approval from state Attorney General Josh Stein on Wednesday, paving the way for the largest health care provider in Western North Carolina to move from nonprofit to for-profit ownership while setting up a massive nonprofit foundation with the sale’s proceeds.

However, Stein listed a series of stipulations to which the parties have consented in his letter approving the transaction. Some of these address concerns that residents of Western North Carolina have voiced since negotiations between HCA and Mission Health became public knowledge.

These included:

  • HCA extends its promise to acquire and maintain several smaller Mission Health properties in Franklin, Spruce Pine, Highlands, Marion and Brevard from five years to 10 years, with greater specificity for continued services at these hospitals.
  • An independent monitor will review compliance and, along with an advisory board, must sign off on any exceptions to these continued services at the local hospitals.
  • HCA will be limited in its ability to cite economic conditions as a pretext for seeking exceptions to compliance.
  • Both the new Dogwood Health Trust and the Regional Foundation will have the right to bid on the assets of any local hospitals that are sold or closed.
  • HCA will build a new facility in Franklin to replace the existing Angel Hospital. Mission Health has already received a certificate of need for this project.
  • HCA will build a new 120-bed behavioral health hospital in Asheville.
  • HCA will continue most of Mission Health’s community service programs, with at least a $14.28 million expenditure.
  • HCA will continue Mission Health’s financial support of emergency medical services in Madison, Mitchell and Yancey counties.

Stein’s letter also made specific provisions for the Dogwood Health Trust’s board, limiting terms of representatives from Buncombe County and ensuring that by 2021 the number of members from any one county will be no more than four.

The letter additionally required efforts to have a level of diversity on the board reflecting the diversity of Western North Carolina’s population. Stein’s letter observed that the initial board had no persons of color but has now been changed to have 27 percent membership by persons of color.

Dogwood Trust board membership map

Attorney General Josh Stein released this map Wednesday to describe the requirements for the eventual makeup of the Dogwood Health Trust board. Courtesy of the state Department of Justice.

The attorney general also called for Dogwood’s meetings to be public.

In addition, the letter provided for a number of means of enforcement of its requirements and for fairness in concluding the transaction.

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