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Major changes are coming to North Carolina’s Medicaid program, and the regional organizations that manage those dollars for behavioral health needs are wasting no time in getting prepared to respond. 

After wading through more than 300 legislative goals presented by more than 500 commissioners throughout the state, the North Carolina Association of County Commissioners has agreed on five top priorities to present to legislators during the 2015 General Assembly.

Macon County Commissioner Ronnie Beale, president of the NCACC, gave his fellow commissioners an update on the recent Legislative Goals Conference during the board’s retreat last week. 

Hospitals in North Carolina face a catch-22 of the worst kind: the $600 million kind, the kind they have no control over, the kind that involves politics.

Hospitals in North Carolina are seeing a financial hit they can ill-afford after state lawmakers in the General Assembly turned down the federal government’s offer to expand Medicaid last year. It would have added 500,000 uninsured poor to Medicaid rolls.

Republican lawmakers in North Carolina are standing by their controversial decision last year to deny Medicaid expansion to 500,000 low-income people who otherwise lacked health coverage.

Some Democrats in the General Assembly are pushing to revisit Medicaid expansion, however. The legislative season had barely gotten underway last week when a group of Democratic lawmakers introduced a bill that would reverse course on Medicaid expansion.

An elderly man was swindled out of $5,500 by a Department of Social Services employee in Swain County, according to an investigation by the Bryson City police department.

As nursing home bills for his wife mounted, the man had sought help from DSS worker Nicole Warren in hopes of qualifying for Medicaid.

Warren has been charged with three counts of obtaining property under false pretenses and one count of felony conversion, or theft, by the Bryson City Police

Warren had told the man — who wants to stay anonymous and whom authorities refused to name — that he and his wife had too much money in the bank to qualify.

It isn’t uncommon to ask Medicaid applicants with too much money to “spend down” their assets on valid household expenses before they can qualify. In this case, however, Warren proposed some rather unorthodox solutions.

According to Bryson City Det. Sgt. Diane Wike, Warren first asked the man to give her a $3,000 loan. He felt pressured to relent.

“He felt like if he didn’t give her the loan, he might not get the Medicaid for the wife,” said Wike.

Later, Warren asked him to “spend down” a further $2,500. While he proposed making a donation to St. Jude hospital, Warren suggested an alternative charity: the N.C. Social Services Association. She told him to make out a check and she would make sure the organization got it. Instead, Warren tried unsuccessfully to cash it herself, an attempt that was caught on bank surveillance.

Warren went back to the man, insisting that he make the donation in cash instead, according to police reports. The elderly man eventually conceded but demanded a receipt. Warren wrote a handwritten receipt in which she scribbled her name illegibly.

He then asked for an affirmation on letterhead, which Warren wrote using the official DSS letterhead.

“She didn’t sign her name to that one,” said Wike.

Warren also asked for the man to transfer property deeds to her name, but he refused.

The man reported Warren to DSS in late May, and the attorney for DSS in turn reported it to the Bryson City Police Department in mid-June.

Wike said Warren confessed almost instantly.

“Her explanation was that she got in a bind and needed money,” said Wike. “She had a clean record. She’s never been charged with anything.”“

Tammy Cagle, the Swain County DSS director, did not return calls, and Justin Greene, the attorney for Swain County DSS, said that he could not comment on any “ongoing personnel issues or certain issues involving law enforcement.”

Abuse of the elderly

This particular case undoubtedly qualifies as elder abuse, according to Kim Gardner, elder abuse program coordinator for the 30th Judicial District Domestic Violence-Sexual Assault Alliance.

“It’s financial exploitation,” said Gardner. “She used her power and influence to obtain $5,500 from this man fraudulently.”

Gardner suspected the Bryson City Police did not include specific elder abuse charges in Warren’s indictments because its penalties are less severe. There is no mandatory jail time though probation can be given.

“That’s probably why they went with the stronger charges,” said Gardner, adding that she’d like to see the charges changed. “We need more teeth in the elder abuse laws.”

To qualify as elder abuse, the victim must be over 60. Though Gardner warned the elderly to be cautious with their money, she doesn’t think they should be afraid to ask for assistance at DSS.

“I know a lot of people have negative thoughts about DSS from time to time,” said Gardner. “[But this is] an unusual occurrence. They’re there to help people.”

A pivotal moment arrives every time a pregnancy test turns positive at public health departments across the state.

The new mother could walk out the doors, overwhelmed and underprepared, never to return again. She could receive little or no prenatal care before delivery. She could possibly die.

Or, she could pay absolutely nothing for prenatal care, delivery and 60 days of postpartum care. Not to mention, childbirth and parenting classes, one year of Medicaid for her newborn child, family planning services, and even emotional support and advice throughout the pregnancy.

It’s a moment that nurses at Haywood and Jackson County health departments don’t take lightly.

“That’s where we grab them,” said Vicki James, maternal care coordinator for Haywood for the past 11 years.

“We really have the nurse literally come knock on my door as they get their positive pregnancy test,” said Courtney McLaughlin, Jackson’s maternity care coordinator. “As soon as we get them, we connect them to all these services.”

North Carolina has come a long way in providing support to low-income women, bringing them closer to the reality of an uncomplicated pregnancy and a healthy baby.

Moreover, Medicaid for Pregnant Woman extends generous financial aid to women who don’t usually qualify for regular Medicaid.

Yet a study released this month by Amnesty International, a human rights group, shows a major gap still exists in care given to pregnant women across the state.

The report states 15.7 percent of women in North Carolina still receive delayed or no prenatal care, equivalent to about one in six women. That number jumps to nearly one in four among women of color.

Amnesty International claims that women who do not get prenatal care are three to four times more likely to die than women who do.

With 11.4 mothers dying per 100,000 live births, North Carolina ranks 37th in the nation for maternal mortality. In comparison, Maine, the top-ranked state, has 1.2 mothers dying for every 100,000 live births.

The reasons for the disparity are manifold, but major culprits include lack of health insurance, lack of access, and lack of education and awareness.

Nevertheless, lawmakers in Raleigh have already made significant cuts to the Baby Love program, which provides nursing and social work to low-income women. They are considering doing away with the program altogether — an idea that causes deep worry for health officials across the state.

“We’re not sure where these clients will go if that program ceases to exist,” said Debbie Sprouse, adult health supervisor in Haywood County.


Logical disconnects

Julie Guffey, a 28-year-old Waynesville resident, says she can’t fathom why those who need prenatal care aren’t receiving it. Guffey qualified for Medicaid for Pregnant Women when she gave birth to twin girls almost a decade ago and easily obtained it again after learning she was pregnant late last year.

Medicaid for Pregnant Women covers all pregnancy-related costs, even those that result from complications. It also provides one year of Medicaid coverage for the newborn child automatically.

Guffey says the entire application process is very simple, and the care she’s received has been excellent. Nurses have sent her home with thick educational packets to prepare her again for pregnancy, and she’s taken advantage of free birthing classes at Haywood Regional Medical Center in the past.

“If the services are available, and if you qualify for Medicaid, I don’t see why they don’t use it,” said Guffey. “Anyone who’s not getting prenatal care, it’s their own fault.”

It is relatively easy for low-income women to receive Medicaid for Pregnant Women, commonly called “Pink” Medicaid because its ID card had been pink at one point.

Income requirements are significantly more relaxed than those that exist for regular Medicaid.

For example, a family of four must make no more than $594 each month to qualify for Medicaid for families, while they can qualify for Pink Medicaid if they make up to $3,400 each month. Unborn children are included in the family count.

But even such a generous eligibility requirement can leave those who need financial aid floundering. Pregnancies in Western North Carolina can run up bills from $4,000 to $8,000. Ultrasounds cost $500 and up, and most women need at least two per pregnancy.

Having health insurance doesn’t necessarily shelter expecting mothers from the burden of financial worries. It’s not uncommon for policies to exclude prenatal care and to consider pregnancy a pre-existing condition.

Katie Martin, a 35-year-old Waynesville mother of two, said she paid nearly $2,500 in pregnancy-related costs, despite having state health insurance.

Martin says she’s not sure many of her friends could meet the Medicaid cutoff requirement even though they’d struggle to pay for prenatal care.

Because her own pregnancy was completely normal and she didn’t take any drugs during delivery, Martin was shocked when she set her eyes on such steep bills.

“I can’t even imagine if we had issues, how expensive the delivery would be,” Martin said.

Some of her bills had to be paid upfront, but Martin was able to set up a payment plan for the rest.

“Her birth is paid for now,” said Martin of her 1-year-old daughter, laughing. Of course, countless other expenses have piled up since then.

“From conception on, they cost a whole lot more than you would think,” Martin said.


Countless barriers to care

Charlene Carswell, prenatal clinic coordinator, understands that no matter how much she and her co-workers preach, some women will always insist that they don’t need prenatal care.

They’ll say “My sister didn’t have a low birth weight baby, and she smoked a pack a day,” said Carswell.

Others adamantly argue that no one received prenatal care a hundred years ago, so there’s no need for it now.

But late or no prenatal care can be detrimental to both the mother and the baby. It can lead to preterm births, dangerously low birth weights, gestational diabetes, and babies that haven’t fully developed.

Many of the women who don’t receive prenatal care do not have health insurance. Even those who have Medicaid may have trouble tracking down doctors who accept it.

Women who can’t afford medical care often put off early prenatal care to save up for the costs that’ll greet them in the third trimester. They pick and choose which tests they’ll get done and which they’ll skip. Even though it’s recommended that pregnant women get a check-up at least once a month, they’ll pass on those as well.

“They say ‘If I’m going to have to pay for the delivery, I’ll save for the delivery, not monthly visits to doctors,’” said Tania Connaughton-Espino, Latina program manager for the North Carolina Healthy Start Foundation, a nonprofit devoted to reducing infant death and illness.

Since Pink Medicaid applications can take up to 45 days to be approved, some patients who qualify for the aid skip out on appointments until it is formally approved.

Other barriers include lack of access to treatment, whether it’s not owning a car to drive to the health department or not being able to take off from work to make an appointment. Mothers might also not be able to line up childcare for their other kids while they are visiting the doctor.

And sometimes, it can be hard to even get an appointment with the recession sending waves of newly uninsured people to local health departments.

According to Connaughton-Espino’s experience, some women just might not see why prenatal care is necessary. They wonder why they’ve given up several hours of work time to wait for a 15 minute appointment with a nurse who measures their belly and takes their temperature.

“We just need to makes sure that moms understand that they can make that appointment important for them and ask questions,” said Connaughton-Espino.

According to Connaughton-Espino, the best route to a solution is through education. Some expecting mothers just don’t know when they’re supposed to take a prenatal vitamin or how often they should visit the doctor.

A whole other category of women who are not receiving prenatal care are undocumented workers. Because citizenship is a requirement for Pink Medicaid, illegal immigrants who are expecting often are left behind.

They do have the option of applying for presumptive eligibility Medicaid, which provides care until an application is formally approved or denied. However, this kind of Medicaid promises only a maximum of two months of care. It allows only minimal contact with a doctor and does not cover the cost of delivery.

At most public health departments, undocumented workers pay on a sliding scale based on their income. Even though the cost of care might be within reach, undocumented immigrants are afraid to even show up on the health department’s doorstep.

“They fear that they’re going to be arrested or shipped back to Mexico,” said Adrienne Maurin, a licensed therapist at Jackson County’s health department.

“Some of them come in later for care, some decline testing doctors recommend,” said McLaughlin, who tries to schedule ultrasounds and any other major tests within the few weeks that undocumented workers gets Medicaid coverage.

Children of undocumented workers who are born in the U.S. automatically get American citizenship, but they might still receive inadequate care because of their mother’s illegal status.

Carswell doesn’t think that that’s fair.

“It’s not the baby’s fault, whoever is pregnant,” said Carswell. “You just have to have good prenatal care.”

For many low-income women, pregnancy can lead to more stress than excitement. Most of the expecting mothers who visit local health departments are facing unplanned pregnancies.

Maternal care coordinators across the state have experienced firsthand all possible emotions along with the patients they support.

“I have a box of Kleenex in my office that I just leave here,” said Courtney McLaughlin, maternal care coordinator for Jackson County.

As part of the Baby Love program, maternal care coordinators contact patients once a month to check in throughout the pregnancy and up to two months after the mom delivers.

“Nine times out of 10, you’re their support system,” said Vicki James, maternal care coordinator for Haywood County. “You talk to them just like you do your own kid.”

Often times the father of the baby isn’t involved or the parents have turned their back on their pregnant daughter. So James picks up the slack and provides advice like a mother would.

She advises women on where to buy cribs, tells them how often they should see their doctor, and answers questions about what is or isn’t normal during a pregnancy.

James has made a lot of friends through her work, but the job comes with many ups and downs.

“It’s very rewarding, it’s very frustrating,” said James.

Jackson County, one of the few counties in the area to have a high-risk prenatal clinic, routinely sees extreme social work cases. Some expecting mothers are dealing with weighty issues, like sexual and physical abuse.

“You don’t know until you make a home visit what this pregnant girl is going through,” said Charlene Carswell, prenatal clinic coordinator for Haywood County.

Adrienne Maurin, a licensed therapist at Jackson’s health department, said she’s recently treated a pregnant woman who was just recovering from a substance abuse problem while simultaneously battling a mental illness.

Others have no psychological issues but come to Maurin just to vent their frustrations.

“They say, ‘I’m pregnant, and I don’t have a job, and I can’t get a job because I’m pregnant,’” said Maurin. “That causes a lot of stress for most of the ladies.

Of course, not all women who visit the health department have unhappy endings to their stories.

Carswell recalled a teenager who was petrified about her mother discovering that she was pregnant.

“Several of us cried with her,” said Carswell. “She was in a state.”

But when her mother found out, she was supportive, and to top it off, the baby’s father re-entered the picture.

James remembered one Hispanic woman who prepared a generous meal for her when she paid a visit, even though the woman had little to feed her own family.

“We had already ate, but we ate again,” said James, who was touched by the kind gesture.

James has seen women from all backgrounds, education and income levels and says there’s no stereotype for the kind of woman who takes advantage of the health department’s services, especially since the economic downturn.

Many who come in are finding it difficult to purchase basic baby supplies, like diapers, carseats and cribs — none of which is covered by Medicaid for Pregnant Women. Maternal care coordinators help provide some of those supplies, though their resources are quickly drying up.

“I’ve seen moms who have slept a baby in a laundry basket or a drawer,” said McLaughlin. Others share a bed with their baby, sometimes leading to cases of suffocation.

Maurin said she worries about her patients quite a bit, especially about the risks of post-partem depression.

“They are more prone to it because of the level of poverty,” said Maurin.

The state agency in charge of implementing new mental health rules this year says those changes will save money and improve quality, but some providers see it as a knee-jerk reaction that will limit access to services and put people at risk.

The Department of Health and Human Services has announced an overhaul of its mental and behavioral health model that will consolidate the state’s network of providers in six months.

“The biggest problem is they’re trying to implement sweeping changes across the system and they’re not giving us time to do it,” said Raymond Turpin, CEO of Jackson/Haywood County Psychological Services.

Turpin and other local behavioral health providers are concerned that the new program, dubbed the Critical Access to Behavioral Health Agency or CABHA, will put small providers out of business in the short run and threaten the stability of the provider network long-term.

CABHA is designed to create a new set of standards and requirements for behavioral health providers that use state and federal mental health funding. The range of services from providers include substance abuse counseling, crisis intervention, psychological assessments, and treatment for mental health issues like depression.

Under the new rules, mental health service providers must have a full-time psychiatrist on staff, national accreditation, and take on additional administrative duties in order to bill through Medicaid — which are tall orders for a small office of counselors.

Whether it succeeds in improving the quality and integration of services, CABHA will most certainly instigate a rapid consolidation of the provider network in a short time frame.

“The environment is going to become more and more harsh for smaller providers,” said Brian Ingraham, CEO of Smoky Mountain Center, the local management entity that oversees mental health services in WNC. “The state is clearly going in the direction of larger consolidated providers.”


Streamline or rollback?

When CABHA is introduced in July, many small providers who aren’t able to meet the program requirements will not be able to bill Medicaid-funded services, forcing them to close, contract with other companies, or lay off staff.

Marcia Lewis –– executive director of Mountain Youth Resources a provider of mental health services that contracts with Macon County Schools –– runs one of the small providers that stands to lose as a result of the changes.

Lewis said her agency could potentially join up with one of the new CABHAs, but is in limbo until the state makes key decisions about how providers will be reimbursed, from what type of services are eligible to the hourly billing rate. Until then, there is no way for companies to create a new business model.

“My own personal view is the state is reacting to things without thinking them through and without determining how they’ll operate and in the meantime clients will suffer,” Lewis said.

Lewis said the CABHA program will add another level of bureaucracy to the service delivery system and create a new layer of costs.

“They keep adding levels of cost instead of levels of service,” Lewis said.

Lewis’ complaint gets at the philosophical debate underpinning the current changes. During the state’s 2003 reform effort, the implementation of community support services was a wide-ranging attempt to offer people in need of behavioral health services more contact with their providers.

The community support model failed. But while the providers that billed for community support agree that its cost spiraled out of control, they also maintain that the state’s poor implementation of reform deserves the lion’s share of the blame for its failure.

“North Carolina was moving so fast that we were being pushed to implement services even before the service definitions were set,” Turpin said.

Turpin said his agency spent big money bringing in state-mandated trainers who couldn’t even explain what types of services community support would cover. He fears the newest round of changes will be managed the same way, preferring a political mandate to the reality on the ground.

Either way, with the General Assembly ordering the department to kill community support by July, systematic change is a political reality.

“The time frames are what we have to deal with,” Watson said. “We’re operating with specific direction from the General Assembly to phase out community support by June 30.”

So far the DHHS has gotten letters of interest from 200 providers who want to establish CABHAs and 20 full applications. Ingraham said he thinks the state will end up with around 100 CABHAs, and only three or four in WNC.

Turpin said the rapid consolidation will hit rural areas hardest, because many people who need services won’t know where to go to get them.

Watson acknowledged access could be an issue initially.

“There may be some access issues initially and that’s something we’ll have to monitor closely with the LME’s,” Watson said.

Duncan Sumpter, CEO of Appalachian Community Services, a mid-size provider that serves rural Graham, Cherokee, and Swain counties, sees the consolidation as a step back to a model that prioritizes economics over human needs.

“There’s a difference between covering a community and serving a community,” Sumpter said. “As we move back towards consolidation, we may go back to covering instead of serving.”


Between theory & practice

Turpin believes the requirement that CABHAs maintain a full-time psychiatrist as an administrator is a deliberate attempt to put rural providers under the gun.

“Now they want to go back to a few huge Wal-Mart agencies and they’re using the psychiatrists as the magic bullet to wipe us out and make room for some national provider to come in and take over,” Turpin said.

Brian Ingraham –– CEO of Smoky Mountain Center, a regional entity that manages the network of private providers –– said psychiatrists are already a scarce resource in the state’s rural areas and shouldn’t be used as administrators.

“The psychiatrists we have now in this part of the state need to be working in a clinical and medical capacity, not in an administrative one,” said Ingraham.

Watson explained that the requirement is intended to create built-in medical oversight in a system that supports medical programs.

“These are Medicaid services and they are supposed to be medically necessary,” said Watson. “With community support you had a program where 90 percent of the providers were high school graduates.”

The difference of opinion over the medical director requirement points to a lack of trust between the state and its provider network.

The state feels it has been burned by providers milking the system. Its providers contend the state never defined its programs in a way they could be administered properly.

Ingraham believes the CABHA program is based on good theory, but he wonders whether the short timetable slated for its implementation will create a new kind of problem.

“The good news is it’s an opportunity to integrate services that really should be bundled under one roof because we are dealing with a fragmented system right now,” said Ingraham.

Not every provider sees CABHA as a threat and most providers agree that the system could benefit from a more regional approach in which services are better integrated.

For instance, under the current system a patient could receive counseling from one agency but their prescription from another.

Joe Ferrara, CEO of Meridian Behavioral Health based in Waynesville, said CABHA could improve the quality of behavioral health services. Ferrara agrees with Watson that the reform effort didn’t work.

“There was a belief that there was going to be collaboration from the providers that would create continuity of care, but it never really happened,” said Ferrara. “The reason community support was removed, let’s be frank, was because the costs associated with it went through the roof.”

But Ferrara also fears that the CABHA program will operate in practice as an unfunded mandate.

“Whenever there are unfunded mandates for the provision of services, the state uses the explanation that they will tweak the rates for the services,” Ferrara said.

The state has promised that the added administrative costs CABHA mandates will be offset by an increased billing rate for case management services, the program that will replace community support.

The state’s budget crisis has created the political reality that those changes must be made by the end of July. In the past year, the state has already cut $40 million out of its mental health system and cuts may be even deeper in the next budget cycle.

With providers strained, the task of overhauling their business models in six months in response to CABHA could force some of them out of business. Even the providers who are well positioned to weather the changes question the wisdom of such a narrow time frame.

“Providers are reeling and all of the sudden they’re going to introduce CABHA and they’re saying the costs will be picked up in the billing rates for case management,” said Ingraham. “Well I really hope so because if not we’ve created a big mess. There’s a lot of risk there.”


The road ahead

At the root of the debate over CABHA is a discussion about winners and losers. Some middle-sized behavioral health service providers stand to grow as a result of the consolidation. At the same time, the regional entities like Smoky Mountain Center that oversee the network of private providers will lower overhead costs by dealing with fewer agencies with better built-in oversight capacities.

Meanwhile though, in Western North Carolina’s rural areas, the people who rely on services will almost certainly face a reduction in service hours and some will likely deal with an interruption in services. In addition, some service providers will likely go out of business entirely.

In the seven western counties, three existing service providers have already begun the process of applying for CABHA certification –– Haywood and Jackson County Psychological Services, Meridian Behavioral Health, and Appalachian Community Services.

All three businesses were created by former employees of the Smoky Mountain Center when the provider network was privatized during the 2003 reform effort.

Now those businesses and many others are facing competition with national providers and forced consolidation.

“It’s just one more change in a stream of changes along the timeline,” Ferrara said. “This is an incredibly difficult time to be providing behavioral health services in North Carolina.”

Haywood Regional Medical Center could miss out on as much as $750,000 in revenue over the course of a year after missing a federal billing deadline for its new mental health wing.

The missed deadline, which occurred last fall, was the result of a misunderstanding between the hospital and the federal Medicaid office.

The psychiatric unit is eligible for a higher rate of Medicare and Medicaid reimbursement than other hospital units. To qualify for the higher rate, the new wing had to be visited by state inspectors and get certified.

State surveyors told the hospital to apply for the survey by mid-August of 2008 in order to meet a cut-off date of Oct. 1. If the hospital missed the deadline, it would have to wait a full year for certification that qualifies it for the higher rate.

This is where state surveyors got picky. The surveyors received the hospital’s application for a survey on Aug. 19, “a date which apparently the state does not consider to be mid-August, although two of the four days in question were over a weekend,” explained hospital CFO Gene Winters, who didn’t work at the hospital at the time.

The state told the hospital that its request was four calendar days late — forcing HRMC to wait another year before it can qualify for a bigger return on the psychiatric unit.

The 16-bed unit has been mostly full since it opened in October of last year, thus serving as a steady source of revenue for the hospital, between $250,000 and $300,000 a month if the unit remains near capacity.

The amount of revenue the hospital is missing out on could be as high as $750,000 over a 12-month period until the window rolls around to get the unit certified, Winters said. According to Winters, the true budget impact from the missed deadline will likely be small, around $300,000. The hospital had budgeted for the psychiatric unit conservatively.

“We are in the process of sharing the pain of the reduced revenue with our psychiatric unit management company, so the impact to the hospital will be minimized,” Winters said.

— By Julia Merchant

Today at HRMC, 10 sets of eyes peer over the shoulders of the hospital administration, ready and willing to question every move.

Though the hospital had a board of directors in place when the hospital lost its Medicare and Medicaid certification a year ago, oversight arguably wasn’t the board’s strong suit. But today, the buck stops with the hospital board when it comes to avoiding another crisis.

In the months following the hospital crisis, it was out with the old, in with the new on the hospital board. The original board members either resigned or didn’t reapply for their terms. A host of Haywood residents, appalled by the hospital’s downfall, were more than happy to step up and play watchdog. When two seats became open in April, county commissioners were flooded with a staggering 37 applications (in contrast, many boards are happy when one person applies). Seven out of 10 sitting board members today are new since the crisis.

The clean sweep will continue in April, when long-time board member and chairman Glenn White will step down and the board is expanded by two. When that occurs, only two out of 12 board members will have been in place under Rice.

“It’s good to have those without experience, because they keep it fresh,” said Cliff Stovall, who was appointed to the board in June. “You don’t want to just do it the way that it’s always been done.”

Board members come from a wide range of backgrounds: a banker, a retired Army colonel, a former district attorney, a nursing instructor, to name a few.

“I think it’s important to have people that aren’t entirely immersed in medicine, because it brings a different point of view,” said Pam Kearney, who also came on board in June.


Back to basics

Defining just how the board is supposed to function has been a top priority. Since the crisis, the board has had to do some serious reinforcing of its core mission — overseeing the hospital administration.

“We didn’t have any concept of what the board’s duties were,” said Roy Patton, who became a board member in June. “There had been more or less a structure for the board, but I don’t think that the board had ever learned to use it. The former CEO kept the board pretty much in the dark.”

That’s not the case anymore.

“The board’s role is oversight, and I think we’ve come to realize how much more important that is than we may have realized at one point,” said Patton.


In the drivers seat

The revamped hospital administration has made it much easier for the board to perform its duty as watchdog. Former CEO David Rice held a tight grip on the flow of information, so what the board knew about day-to-day hospital activities was limited.

“We asked questions in the past, too, but it’s the answers and responses that you get that are key,” said Mark Clasby, a board member who had served for a year and a half when the crisis hit.

“I think that the board was just somehow lulled into pretty much an acceptance of what Rice said was going on,” Patton said.

Consequently, HRMC’s loss of Medicare and Medicaid certification caught board members completely off guard.

But as the hospital’s culture began to change in the wake of the crisis, so did the relationship between the board and the administration.

“I think the thing that I see changing is that the board members and the administration are actually having dialogue and discussions,” said Kearney. “It’s not a one way street. The communication lines are now open, and board members are not denied access to information.”

Kearney said the board has demanded the larger role.

“I think the board really is driving it,” Kearney said.

Since the crisis, the board has put measures in place to make sure it’s not kept in the dark.

For example, an immediate notification process requires the hospital administration to notify board members of any incident affecting HRMC.

“It allows the board to be in the loop of information from day one,” said Kearney, “so we don’t read about it in the media or find out about it secondhand.”

In contrast, Rice kept such incidents a secret from the board. Board members were unaware of the brewing crisis a year ago that the hospital’s Medicare status was in jeopardy.

Board members also now attend exit interviews when any hospital inspection is completed, which “enables the board to learn firsthand if there are serious patient concerns,” said Kearney. “This was discouraged in the past.”

At a recent exit interview, surveyors even opened up the floor so board members could ask questions — something Kearney recognized as a real turning point for HRMC.

“There was not one person in the hospital who was going to make or break that survey, as was the case in the past,” she said.

Haywood County Commissioner Kevin Ensley, who along with other commissioners appoint the hospital board members, said the crisis should serve as a wake-up call to anyone serving on a board to be more diligent in their oversight. Too often, those at the helm of an organization can lull their board into complacency or charm them into compliance.

“If you tried to remove David Rice two weeks before that happened there would be a firestorm,” Ensley said. “The one good thing that has come out of this is all the boards in the county see you really have to watch what management is doing. We could all point our fingers at ourselves because people weren’t paying attention.”


Not afraid to ask

The idea of the board taking the wheel marks a sharp change from before the crisis, when decisions were often made in a unilateral manner by the administration.

“I don’t think that we would now be able to have that same reliance (one the administration),” said Patton. “I think we’re always going to be saying, is this right?”

Today, there is no shortage of questions for hospital administrators at board meetings.

“I can assure you that nobody leaves without getting questioned to the hill,” said board member Cliff Stovall, who was appointed in June. “There’s no timidity on the board. There are no wimps in the meetings I’ve been in.”

Board members hope a renewed emphasis on oversight and open communication will ensure they’ll never again be blindsided, as was the case a year ago.



Though the hospital is still on a road to recovery, board members say there have been some key turning points since the crisis.

Patton says positive change began to take hold right away.

“I think that immediately, when things fell apart, some things started turning around,” he said. “All of a sudden, we had training going on, and more attention to the things that we hadn’t been paying attention to earlier.”

Stovall said one of the board’s biggest accomplishments since the crisis has been getting the hospital’s finances back in the black. The hospital’s lack of debt made this easier, he said.

“We did spend a lot of money just to keep going, but our money did not evaporate,” Stovall said.

Clasby said as of December, the hospital was ahead of its budget for the year — a positive but preliminary sign, since the fiscal year only started in October.

Board members also named the hiring of CEO Mike Poore as a key accomplishment.

“It’s just been a breath of fresh air for us,” Patton said.

Board members expressed mixed sentiments on whether the hospital has overcome one of its greatest challenges: regaining the community’s trust.

Stovall said he views the frequently full parking lot at the hospital as a sign that people are coming back.

“I think that’s an indication that people are using it, so it’s restored confidence,” he said.

Patton was a bit more hesitant.

“I would say yes, there has been some trust regained, but I don’t think that we’re to the point where we can say, we’ve done it now and we can relax,” he said.

Kearney also says there’s work to be done.

“The community sentiment is more positive toward the hospital than a year ago, but we haven’t yet seen a sufficient increase in the daily census,” she said. “I think that’s the only tangible way you can measure that. I would say there are people that are going past Haywood and going to Asheville.”


Phoenix rising

The crisis that hit Haywood Regional helped to erase a culture of fear and overhaul the hospital’s administration and practices. So is HRMC better off for it?

“That’s a real difficult question, because you just blew $10 million,” said Kearney. “We spent some of our future, which is unfortunate.”

Clasby says that in the end, HRMC did emerge as a better hospital — though the road to get there was tough.

“It’s a shame and it’s sad that we went through what we did, and it was very painful for the community,” he said. “But we had an opportunity unfortunately to correct the things that were wrong and to rebuild this into an excellent, quality institution. It’s kind of the rising of the phoenix.”

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