A controversial proposal for a second Greensboro hospital has received conditional state approval after health regulators determined Atrium Health Wake Forest Baptist has proven the overall need for the $246 million facility.
The conditional approval of the certificate-of-need decision was disclosed Wednesday by the N.C. Division of Health Service Regulation. The proposed 36-bed hospital at 2909 Horse Pen Creek Road would have at least 152 full-time-equivalent employees at full capacity.
Following an April 19 public hearing on the application, the division indicated a decision likely would be made between July 31 and Sept. 1.
Cone Health, which operates the only Greensboro hospital, vigorously opposed the Baptist application. Cone submitted an immediate appeal rather than wait up to 30 days.
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“This is a poor decision for everyone needing health care in this area,” Cone chief executive Mary Jo Cagle said in a statement.
Baptist spokesman Joe McCloskey said the system “is pleased with the state’s decision and we are eager to move forward.”
“But, out of respect for the process, we are reserving additional comment at this time.”
Baptist has projected construction commencing by December 2024 with a goal of opening by July 2026.
However, the appeal puts on hold the issuing of the certificate of need.
The purpose of the state’s CON laws is to limit or prevent duplication of medical services within a community. The laws also serve as a disincentive to for-profit health-care providers to open facilities.
The 36 beds would be transferred from Baptist-operated High Point Medical Center, rather than be newly created in the county.
The proposed facility also would feature no more than 12 observation beds, two procedure rooms, 20 emergency department bays, two fixed CT scanners, one general radiology X-ray unit, one fluoroscopy X-ray unit, two ultrasound units, one SPECT scanner, one mammography unit and one fixed MRI unit.
State regulators typically do not provide specific comment on CON decisions.
In their 49-page analysis of the Baptist application, regulators indicated they did not view the proposed hospital as providing duplicative services, and that those services are needed in the community.
“People in our community already have options when it comes to health care,” Cagle said. “This decision runs counter to how CON is supposed to work.”
Regulators’ determinations
The proposed Baptist hospital is 2.1 miles from a Cone Health facility that opened in May 2022 — a 160,000-square-foot MedCenter Greensboro facility at 3518 Drawbridge Parkway.
The $97 million Cone facility includes an emergency department, ambulatory care center, imaging, physical therapy, cardiology, wellness programs and 13 overall services. It houses a Sagewell Fitness center, swimming pool and teaching kitchen.
Regulators said Baptist provided “reasonable and adequately supported” information and “adequately determined the need to redistribute acute care, inpatient and surgical services, and imaging and ancillary services in the Guilford County service area.”
Regulators also determined Baptist “provides evidence of physician and community support for the project as proposed.”
An April 19 hearing at the Benjamin Parkway library lasted two hours and drew more than 70 attendees, nearly double the 40-seat capacity of the meeting room.
The divisiveness of the issue was demonstrated in part that of the 19 public speakers, 11 were in opposition — including Greensboro mayor Nancy Vaughan — and eight supportive.
“One of my concerns, and a concern that is shared by the city council, is simple,” Vaughan said at the public hearing in recommending Baptist build its hospital in east Greensboro where she said there is less health-care access and higher need.
“We believe in equitable access to quality care,” and northwest Greensboro residents already “have many options and are more likely to be privately insured.”
Public speakers supporting the proposal said it would provide Greensboro residents with an additional health-care option and a feeder program into specialty care in Atrium facilities in Charlotte and Winston-Salem.
Some public speakers shared Vaughan’s concerns that Atrium was not addressing need, but rather profits, with the proposed hospital, and that those profits would be sent back to Charlotte rather than reinvested in the local community.
Regulators said Baptist proved the proposed Greensboro hospital would serve to increase overall health care access for medically underserved groups while serving an area of Greensboro experiencing significant population growth.
On Wednesday, Vaughan said that “while I think competition is a good thing, I question that location.”
Vaughan said she believes the location was “cherry-picked,” noting the overall higher income of residents in that area, and the probability that they carry health insurance.
“I would support a hospital if it is located in an area currently underserved or is filling a void. Greensboro has some areas that are virtually health-care deserts,” Vaughan said.
Another key determinant by regulators is that High Point Medical Center would not be hampered by the bed transfer.
Part of the Cone opposition stated concerns that the money spent on the Baptist hospital is money that won’t be invested in expanding care to those High Point communities.
Cone responses
Cone has stated boldly its opposition to Atrium’s plans, citing concerns about duplicative services and claims of more expensive health-care services. That includes full-page ads in the Winston-Salem Journal and News & Record.
They expressed skepticism that Atrium would provide lower cost care at the proposed hospital.
They cited concern that Atrium would either staff with non-local providers offering services on a limited local basis, or would try to raid Cone staff, particularly emergency personnel, to meet workforce needs and further strain Cone’s staffing needs.
As a result, they said Cone could be forced to respond to the proposed hospital by increasing its charges.
“This community doesn’t need a very expensive facility duplicating most of the same services offered by a Cone Health facility just two miles away,” Cagle said. “Cone Health is already the lower-cost provider. Our quality is already top tier.”
Cone also maintains the proposed hospital will be a way station to Winston-Salem for anyone needing more than routine hospital care.
People being transferred to Baptist would face higher academic medical center costs, Cone claimed.
Atrium proposal
Atrium said in its application that opening Greensboro Medical Center would be complementary and supplementary to Cone’s health care.
“Approval of Greensboro Medical Center will enable Greensboro to match the other top five North Carolina cities in hosting multiple hospital systems and having local hospital competition, which will be a benefit to local residents,” according to the Atrium application.
Baptist officials noted the High Point facility has improved with the opening of a high-risk obstetrics clinics, enhanced intensive care units and advanced technologies, including robotic surgical techniques.
Kevin High, Baptist’s president, was the presenter for the proposal. He touted that an Atrium- and Baptist-affiliated Greensboro hospital would provide a high quality of care, safety and services, particularly to lower-income patients.
“This project is about how to most effectively improve access to acute care services in Guilford County,” High said.
“This project is perfectly aligned with the basic principles of the state Medical Facilities Plan” that serves to determine health care needs in regions across the state.
High said that relocating the acute beds and operating rooms represents an efficient means of adding services in Greensboro without hampering care in High Point.
“All residents in Guilford County would have access to our quality of care, regardless of ability to pay,” High said.
Replanting flag
Atrium would be able to replant a strategic flag as it grows comfortable in its affiliation with Advocate Health, the nation’s fifth-largest health-care system.
This time, the Atrium brand would be front and center in Greensboro.
In June 2012, Atrium (then branded as Carolinas HealthCare System) entered into a 10-year management contract with Cone in which it gleaned valuable operational insight into the Greensboro and Guilford County marketplaces.
That contract ended in February 2020 by mutual consent as Atrium was negotiating with Wake Forest Baptist to expand its collaboration beyond a November 2019 agreement.
That agreement proved to be the catalyst that led to Atrium acquiring all of Baptist in October 2020.
Keith Debbage, a joint professor of Geography & Sustainable Tourism and Hospitality at UNC Greensboro, said that “a health-care market that offers choice may well translate to health-care services that offer more competitive, affordable prices.”
Debbage cautioned that Cone “is never going to take any incursion into their home base lightly.”
“The hope is better choice and more affordable prices but not before, potentially, a protracted regulatory and legal battle, which may delay the provision of improved health services.”