Dogwood Health Trust notified the N.C. Attorney General’s office Tuesday morning that it plans to warn HCA about potential violations of the terms of HCA’s 2019 purchase agreement for the Asheville-based Mission Health hospital system, based on HCA’s annual report and the findings of an independent monitor.
Dogwood is notifying HCA of three instances of potential noncompliance, concerning:
- Provision of emergency and trauma services and oncology services at Mission Health
- Failure to remain “enrolled and in good standing” in Medicare and Medicaid
- Issues with uninsured and charity care policies
HCA, the Tennessee-based for-profit hospital chain, acquired the Western North Carolina nonprofit Mission Health system in 2019 for $1.5 billion. This purchase resulted in the creation of the Dogwood Health Trust, a foundation which holds the money HCA paid to the nonprofit.
In allowing the acquisition, the Attorney General’s Office placed key stipulations on the agreement to which HCA agreed.
Dogwood has been entrusted with ensuring that HCA remains in compliance with those stipulations. The trust is tasked with hiring an independent monitoring company to help make this judgment.
“It’s a little unusual,” Affiliated Monitors’ project manager Gerald Coyne said at a virtual media event Tuesday afternoon hosted by Dogwood.
“In a lot of states, when you have a proposed hospital merger that’s approved with conditions, those conditions are directly enforced either by the State Department of Health or by the attorney general or by both. Under this agreement, the decision was made at the time that the monitoring would … not (be done) by the state directly.”
The first monitoring company, Gibbins Advisers, deemed HCA compliant each year, though two issues of potential noncompliance were resolved in 2020.
Meanwhile, tensions between HCA and its employees, as well as the communities which it serves, have risen to a boiling point. This year, Dogwood replaced Gibbins Advisers with Affiliated Monitors.
“When we hired the new independent monitor, we did expand the scope of their work to include more community engagement and education, … and more communication with the AG’s (attorney general’s) office,” Dogwood Health Trust CEO Susan Mims said at the media event.
Attorney General and Democratic gubernatorial candidate Josh Stein has 30 days to inform Dogwood whether he agrees or disagrees with its findings. By Oct. 27, either Dogwood or the attorney general must notify HCA of any noncompliance.
“The only remedy (for potential noncompliance) under the asset purchase agreement is what we refer to as specific performance,” Rachel Ryan, Dogwood Health Trust’s attorney, said at the media event. “It’s really working with HCA to get them back into compliance: that’s what specific performance is about. There’s no monetary penalties or anything like that.”
If the parties are unable to come to a resolution through dialogue after HCA receives official notice, then Dogwood has the right to move toward resolution through the courts.
Concerning continuation of services
Stein is already suing HCA over previous allegations of noncompliance concerning the first instance of potential noncompliance identified by Affiliated Monitors: discontinuation of emergency services and cancer care.
“Dogwood’s letter and the independent monitor’s report each highlight potential areas of noncompliance that are consistent with the serious concerns that led our office to sue HCA last year,” Nazneen Ahmed, press secretary at the attorney general’s office, told Carolina Public Press in an email.
Affiliated Monitors’ report indicates that it will allow the court to resolve this issue, and not move forward with resolution plans of its own.
“The allegations that the Attorney General made were very specific about the levels of care and how they had degraded,” Coyne said at the media event.
“Candidly, HCA’s counter to that was equally specific, and rather than us trying to sort out who was right and who was wrong there, without the benefit of the discovery process, without the benefit of additional legal memos, it would seem that we would be almost taking over the jurisdiction of the court, which we didn’t think was appropriate.”
HCA also faces litigation from several local governments in Western North Carolina, which allege that it has engaged in monopolistic activities that have reduced the availability of health care options in the region.
According to HCA, this is the only potential noncompliance that is not already resolved.
“In addition to recognizing that HCA Healthcare has been in compliance with the APA from 2019 to 2022, we agree with the findings of compliance in the majority of the report,” Nancy Lindell told CPP in an email.
“There are two areas where the IM noted the potential for non-compliance relating to findings from CMS at Mission Hospital that were resolved earlier this year.”
Medicare and Medicaid enrollment
In December 2023, Center for Medicare and Medicaid Services delivered a letter notifying HCA that their Asheville hospital was in Immediate Jeopardy due to nine instances of patient harm or deaths in 2022 and 2023.
Immediate Jeopardy is the most serious citation CMS can deliver to a hospital, and Affiliated Monitors determined that because of this, HCA could no longer be considered ‘in good standing’ with CMS.
Mission Health received approval from CMS on their Plan of Correction, but because this occurred after Affiliated Monitors’ reporting year, it could not be fully taken under consideration in their report.
“The CMS is on its way to being resolved,” Coyne said at the media event. “I would not suggest that it is resolved yet. Even though they have certainly taken first steps towards (compliance), there remains work to be done. They couldn’t just shut it down now and say we’re all set.”
Lindell appears to disagree, calling the issue resolved.
“Mission Hospital is in compliance with governing regulations and at no time was the hospital suspended from treating Medicare or Medicaid patients,” Lindell told CPP.
Uninsured and charity care policies
Affiliated Monitors specifically requested information about any revisions to HCA’s charity care policy at Mission Health, confirming that patient billings that qualify under the policy are not subject to collection procedures.
HCA told the monitor that no such revisions — or revisions of any kind — had taken place. Later, the company told the monitor that there had been a mistake, and a revision to the policy had been enacted. HCA deleted a provision that limited when liens could be imposed.
“As an organization, (HCA does) not pursue litigation activity that involves suing patients or filing liens on patient debt accounts,” Lindell told CPP.
Coyne did not necessarily see it that way.
“Even though there may not have been the intention by them to use liens, (changing the policy) certainly opens the door that if future administration or future leadership in the company were to change that position, the people of Western North Carolina would have lost an important protection,” Coyne said at the media event.
What comes next
Affiliated Monitors is planning on returning to Western North Carolina for a week in September to continue community engagement and meet with groups whose opinions they might have missed last time.
“We recognize that during the two weeks that we spent on the ground, we really only scratched the surface in terms of all of the people that have viewpoints and information that they want to share,” Coyne said at the media event. “And we want to work as hard as we can to give folks the opportunity to share that with us.”
He is not certain yet what form that return visit will take.
This is a developing story and is being updated frequently.
This article first appeared on Carolina Public Press and is republished here under a Creative Commons license.
HCA in non-compliance with the 2019 APA…. yeah, like from day one basically. And again, the Dogwood Trust fund sends along yet another damning annual Monitoring Report from another independent auditor/monitor to the NC Attorney General. I see a pattern here… Well, in the meantime while Reclaim Healthcare WNC is lawyering up… avoid using HCA Mission and its associated services/practices whenever possible. A year or two of this and HCA will be more than willing to sell what they stole.