State report shows major hospital systems scored record profits during pandemic

State report shows major hospital systems scored record profits during pandemic
Published: Jun. 22, 2022 at 3:49 PM EDT
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WILMINGTON, N.C. (WECT) - A new report shows that North Carolina’s seven major hospital systems made millions of dollars in profit throughout the pandemic, and State Treasurer Dale Folwell says it came at taxpayer expense.

“The healthcare cartel, which has become more ‘cartel-ized’ in the last four years, is driving up the cost of healthcare in the state,” Folwell said.

Novant Health, which operates New Hanover Regional Medical Center, received more than $260 million in COVID relief money and thrived financially during the pandemic. Folwell says Novant is one of the seven hospital systems in North Carolina that received a disproportionate amount of COVID relief money compared to independent hospitals.

“Before it’s even had its second birthday, we had one of the premiere, independent, high-quality, high access, and profitable hospitals in New Hanover County,” Folwell said, “And now we’re hearing reports of people dying in the emergency room because the multi-million dollar executives refuse to pay traveling nurses to actually tend to these people. This is happening right in front of our eyes.”

Folwell says these seven healthcare systems are driving patients into debt while driving up costs.

“There’s nothing sexy about the fact that, even when people do have insurance, they feel like they are one out of network, one surprise bill, or one medical bill away from generational economic destruction,” said Folwell.

The state treasurer has called for more transparency in healthcare billing and said that is where the change needs to start to fix the problem.

“The solution is clear pricing,” Folwell said. “Get rid of secret contracts, and have reference-based pricing which reflects nearly 100 percent profit margin over Medicare reimbursement rates. Push the power to the consumer, stop weaponizing people’s credit scores, and make sure that the charity care is commiserative with the tax credit that they’re receiving in the state.”

In response to the report, a spokesperson for Novant Health said the following:

“Our teams at Novant Health have been tirelessly working on the frontlines of this pandemic for more than two years to ensure everyone, regardless of their ability to pay, is provided the care and attention they deserve. Like other hospitals throughout the country, we still are experiencing a healthcare crisis – one that stems from a strained and overwhelmed system dealing with staffing shortages in nearly all areas of care, driving labor expenses higher and profit margins lower. Novant Health used Provider Relief Funds to open testing centers, vaccination clinics and respiratory assessment clinics. Additionally, those funds helped make up for the loss in care volumes seen during the pandemic.

As a tax-exempt organization, we have a responsibility to provide a tangible benefit to our communities and Novant Health earns our tax exemptions every day. In 2021, Novant Health provided more than $1.1 billion in community benefit, including $192.8 million in financial assistance to members in the communities we serve.”

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