Board of Commissioners - Regular Meeting

Okay. Good afternoon, everyone, and thank you for joining us today. And I'd like to officially welcome you to the work session of June 8th, 2026. I call the work session to order. For today's meeting, we have one item to cover. That's Wake Med staff briefing. So I'd like to call the members of Wake Med leadership team to the podium. I see everyone is presently seated. So if I think introduction, I think is a great way to try to get started here. So if I start on the left and kind of go around.

Good afternoon. I'm Dr. Kevin High. I'm from Wake Forest Baptist Health, Atrium Health Wake Forest Baptist, and I'll be talking about our integration with Atrium later on. Thank you.

I'm Donald Ginsig, President and CEO of Wake Med Health and Hospitals.

I'm Gene Woods, I'm CEO of Advocate Health, of which Atrium is part of.

Thank you. Dan Blue III, I'm a member of the Board of Directors for Wake Med.

Thad McDonald III. I have the honor of serving as the Chair of Wake Med Board of Directors.

Margaret Forster Bratton, the first, and I am the vice chair of the board of directors.

To complete the compliment of officers, I'm Mary Nash Rusher. I'm the secretary of the board of directors of Wake Med.

Awesome. Thank you so very much. Board members, I'm going to start with Commissioner Adamson here.

Sorry, I didn't know we were inducing ourselves too. I'm Vicki Adamson. I've been on the board three terms. I'm about to start my fourth term in December, and I represent District 7, which is basically Crabtree to the airport, most of Briar Creek, and a chunk of Cary and a chunk of Morrisville.

Good afternoon, I'm Tara Waters. I represent District 5, which is home to Big Wake Med, and also includes all portions of Southeast Raleigh, a portion of Knightdale, a portion of Garner, and glad to be with you.

My name is Roger Askew. I'm the interim county attorney for Wake County.

Good afternoon, everybody. Sophia Jackson representing District 2. That's the southern part of Wake County, including Fuquay, Holly Springs, Garner, quite a bit of unincorporated Wake County. Thank you. I look forward to the conversation.

Good afternoon. I'm David Ellis. I'm the county manager here.

Hi, Susan Evans. I'm the representative from District 4. This is my eighth year on the board. District 4 is all of southwest Raleigh, some unincorporated area, about a third of Cary and about half of Apex. And the Wake Med Cary campus sits within my district.

Good afternoon. I'm Cheryl Stallings. I represent District 3, which is parts of Cary, Morrisville, and Apex. I'm also a psychologist, and I co-own a mental health practice here in Raleigh. So good to be with you all today.

Thank you.

and I'm also a Health and Human Services Committee Chair. Thanks.

I was gonna ask, you're not gonna add that, Cheryl?

Good afternoon. My name is Shanika Thomas. I am the commissioner from District 6. District 6 is from North Hills at the Beltline all the way to the county line going north, includes parts of Wake Forest and Falls Lake. I've been on this board for six years. I was elected in the middle of a pandemic, and I have enjoyed my time here. I also serve as the second vice president for the North Carolina Association of County Commissioners, and I serve with the National Association of Counties. So I talk to a lot of county commissioners about what's going on around the country. Glad to be here. Looking forward to the conversation.

Thank you, board members, and I'm Don Meyer, the chair of the board. I represent District 1, which is part of Nightdale, all of Windale, Zeblin, Roseville, part of Wake Forest, and even go into Summer Raleigh. I think the facility that's located on the right there off of Durant Road. I think that falls right in my district. So it's a pleasure to have everyone here with us today and we're looking forward to some great information. So I'm gonna go ahead and turn it over to you and give you an opportunity to go ahead and start your presentation. Thank you.

Thank you, Mr. Miles, and good afternoon to everyone. We appreciate the opportunity to be here to speak with you today. I am Thad McDonald, as I mentioned before, and I truly am the third. I'm a retired OB-GYN. I spent my entire career at Wake Med and most of my training at Wake Med. Currently, as I mentioned, I have the honor of serving as chairman of our board. I want to thank you for your consideration and especially for recommending that we hold community forums. I thoroughly enjoyed these forums. And I really appreciate the fact that so many of you also attended the forums. We really enjoyed the dialogue. We enjoyed the questions. People were very honest and forthright. And they were honest with their praise and with their uncertainty, which we appreciate. I actually saw this uncertainty as a compliment. Folks are uncertain because Wake Med really means something to them as it does to us. So on the upper left of this slide, you see our pyramid. It's a visual model of our culture, priorities, and goals. It shows how our core principles support the top of our pyramid, which is our mission to improve the health and well-being of our community by providing outstanding, compassionate care for all, regardless of their ability to pay. This mission is the lens through which every decision is made. Our board, or as a board, our fiduciary responsibility is to ensure that this mission stays alive and well, and alive and well far into the future. In our hearts, we believe a strategic combination with Atrium Advocate Health is the best way to ensure that this mission stays alive well into the future. and I might add, thrives for years to come. Today you'll have the opportunity to learn how we came to this decision and also hear from Gene Woods, Chief Executive Officer of Atrium Advocate Health and others from his organization. Hopefully you'll find how similar our two organizations are and what great value we can add to the community by joining forces. Our shared commitment to the community and outstanding care for all will form the cornerstone of our mission's future. Out of respect for your time, and especially to provide more opportunity for questions, since you've had our slide deck, I think, for several days, and this is detailed in this presentation, we will highlight the key points for you today. As I mentioned in the beginning, we thank you for asking us to engage directly with the people of our community. We've had five in-person community forums. We've had one virtual forum. 235 people attended the in-person forums and 70 attended the virtual forums. The overall tone suggests that the community folks that we were able to meet with and speak to were receptive. And I was especially moved by the individual stories from people about what Wake Med had done for them and their families. In the first forum, there was a gentleman whose son was 60 years old and was delivered at Wake Med. And that was probably the year it opened. And I did not deliver him. uh... consistent concerns there were consistent concerns however around local control cost quality of care transparency and the future and these will be discussed with you today we plan on keeping these conversations going on with a series of faith-based community sundays the first of which is this sunday the fourteenth we hope you can join us is in one of these above listed events We'll continue in late June with outreach to our community partners and other safety net organizations. As you can see here, we've also been working to engage the community outside of these in-person sessions with resources on our website, a limited podcast series, op-eds, radio advertisements, and social media. Opportunities have also been provided for our Wake Med family to learn what this combination means for them and the patients they serve. There have been 10 employee forums attended by over 3,000 employees, which is about a quarter of our workforce. In these forums, concerns were also expressed, which we understand. Next. Let's take a look at how we got here today. In early 2022, we put out an RFP looking for partners in oncology, and the only organization that responded in this state was Atrium. Our executive team, as they began working with Atrium, found an organization almost a mirror image of Wake Med, an organization with a similar history, similar culture, and a similar purpose to care for all. The executive team then took a deep dive into Atrium, confirmed these similarities, and engaged attorneys to look at a partnership between the two entities, which led to the development of an initial term sheet. In January of 2024, this concept of a combination was presented to the executive committee of the board. our initial response as an executive committee was much the same as some of you here and members of the community give up autonomy we've always been fiercely proud of our independence however looking at the future of health care and especially the challenges facing safety net hospitals like ours we felt it would be irresponsible not to give it vigorous due diligence this was a board decision and second only to its founding, the most important decision our board would ever make. Our executive committee then paused all discussions and began two and a half years of due diligence to answer three questions. First, what does the future have in store for safety net hospitals like Wake Med? Second, given the obstacles identified and the strategic plans we've already made, along with the acute need to renovate the Newbern campus, can we be certain of our ability to financially meet the needs of our ever-growing population? And third, would Atrium Advocate be a sound and suitable partner? In summary, our findings were as follows. And I will state again, our mission was central to this decision making. What will keep this mission alive and well far into the future? Our valuation to the future of non-profit safety net hospitals like Wake Med as well as our own marketplace revealed almost insurmountable obstacles. So in July of 2024, we did an in-depth business case analysis with Kauffman Hall.

I'm sorry, Mr. McDonald. I'm sorry. Could you repeat? You said three things. Yeah. Could you repeat those things for me, please?

I'm trying to take notes. Sure. First, what does the future have in store for safety net hospitals like ours, like Wake Med? Two, given the known obstacles identified and strategic plans we've already made, along with the acute need to renovate the New Bern campus, are we financially able to continue to meet the growing needs of our population and care for everyone? And third, would Atrium Advocate be a suitable partner to help us continue that mission?

Thank you very much, I appreciate it.

Thanks, Shanika. So in July of 2024, an in-depth business analysis revealed that the financial requirements necessary to achieve our objectives exceeded what we could accomplish alone, and a strategic partnership would be essential. So we created a task force to look at the appropriate terms for such a combination. Working through the fall of 2024, In January of 2025, we engaged Juniper Advisors, a leading health systems transaction firm, and began weekly meetings to review and revise our term sheet, as well as continuing an in-depth analysis of Atrium Advocate in comparison with other possibilities to ensure strategic alignment and confirm that they were the ideal partner. Our term sheet was finalized in the summer of 2025, after which our executive committee and task force traveled to Charlotte to meet with Atrium CEO Gene Woods and key members of the Atrium Advocate family. We found in that meeting, just as our executives had three years earlier, we were meeting with family. We were walking into a hospital just like ours. We were speaking with folks just like ourselves. and the quality and the expertise that we found there was a mirror image of Wake Med. After this visit, the executive committee voted unanimously to take the proposed combination and term sheet to the full board for approval. In November, the proposal was taken to the full board where again it was unanimously approved. And in December 2025, the term sheet was executed and our due diligence continued until March of this year when Donald presented it to your closed session. Okay. In mid-April, there was final approval by the Atrium and Wake Med Boards, and on May the 4th, the proposal went before you, which brings us to where we are today. So it's my pleasure now to introduce Jean Woods, Chief Executive Officer of Atrium Advocates, so you can learn more about Atrium, who they are, what they mean, and what a combination with them will mean for us. Thank you, Jean.

Thank you and welcome, Gene.

Thanks. Good afternoon. It's really good to be here. This is probably among the most important decisions that you'll make for the future of this county. We appreciate whatever questions come from this forum. You're not only deciding what's going to happen 10, 20, 30, 40, 50 years from now, but also what we've heard is how important it is to make sure as a safety net provider, you're taking care of the most vulnerable in this community. And so we're here, excited to answer questions along those lines. The other thing we've heard is that there's something really, really special this community feels about Wake Med. And the questions that we've heard are along the lines of, is Wake Med gonna stay Wake Med? And there's a lot of, health systems throughout this country that are going to have to change to respond to the future but the question is what is the essential parts of the value set that this organization has is that going to remain true and i hope to answer some of those questions in terms of because those are the same values that we we hold as well The question also is, what we realize is not many people know us in Raleigh in these parts, so excited about the opportunity to share a little bit about who is Atrium and who is Advocate Health. And specifically, we came together as Advocate Health about three and a half years ago. And if you see from this map here, we had Aurora Healthcare that was historically the largest provider of healthcare in Wisconsin, also the largest provider of Medicaid in Wisconsin as well. And then you have Advocate Health in Illinois, again, the largest provider of healthcare in Illinois and also the largest provider of Medicaid. And then you have Atrium and Wake Forest University School of Medicine that we came together a little over five years ago. So these are the combination of organizations that actually did not have to come together. We had the same deliberative conversation that this board has had is, are we prepared for the future in healthcare and how do we be better together? If you look to the left, you'll see of all the health systems in the country, We provide $6.2 billion of community benefit. That's an important number because that involves our discounted care, free care that we provide, and also the work that we do outside of our walls with community organizations and invulnerable communities. And I want to talk a little bit more about that. We're the third largest for-profit in the country, headquartered in Charlotte, and it's never for us been a matter of size and scale. It's been about what that size and scale enables for our patients, for community, and also to stay on top of the latest technological advances that are happening very, very quickly in the field. So you see some of the other statistics here. Six million patients that we'll take care of this year, 172,000 teammates, we call them teammates, and 69 locations throughout the states that we serve. If you look to our philosophy, and this is important in this conversation, what we say our philosophy is to be locally focused, regionally connected, and nationally impactful. And I want to talk a little bit about the locally focused part because what I strive to do and my team strive to do every day is make a large organization feel like a small community. And we know that's what you really love about Wake Med. And we do that through a number of ways. One is we are a believer in community-based boards. So it's not just the board here that we're having conversations with, but we have a community-based board in Winston-Salem. You'll hear that in a little bit. We have a community-based board in Macon, Georgia, or Rome, Georgia, because our belief is for us to really understand the needs of the community, the communities we serve, And they're much different. Charlotte's much different than Milwaukee. It's much different than Rome. We need to have these local boards that are connected and live in those communities. And that's why this deal is structured the way that it's proposed. We also have management that's local and live in the communities that we serve. So it's very, very important for us to stay locally focused, including, and I'll talk about this a little bit more, the healthcare challenges that we face are much bigger than any one organization can tackle. And so we have a network of not-for-profit organizations that we partner with in each of the communities we serve, and I'll talk about that a little bit more. In terms of regionally connected, We are, the focus that we have is trying to provide care along life's journey. This year, we'll have 60,000 babies that take their first breath of life in one of our facilities. We'll talk more about that. And we take that journey all the way to elder care and everything in between. And so we're really focused on that comprehensive network of services in each of the regions that we serve and making investments in that regard. And then nationally impactful, Every time we've come together with a new organization, we've learned from that organization and they've learned from us. And what we do is we take those best practices and then we spread them throughout our entire organization. And we have proof point after proof point on that. So what's in it for us and part of it is we're going to come, if we come together, we're going to learn a lot from Wake Med that we'll be able to take to the rest of the system and we hope to do the same here for this community. This is, if you just think about North Carolina specifically, we serve 2.4 million patients across North Carolina as the largest provider of care in the state. We're the largest non-governmental employer in the state. It's 76,000 teammates. And 4,000 of our teammates are employed physicians. Now, we're an open model, so we welcome independent physicians and employed physicians alike. But what we're really, really proud of, if you think about our physicians, the American Medical Association, their highest award is called the Joy of Medicine Gold Standard. And we are the only ones in North Carolina that has received the AMA's highest award for physician satisfaction, including reducing, you've all heard about reducing physician burnout. It's a real thing. We're also the only system, the largest system in the country that has received the Joy of Medicine Gold Award for the physicians that are part of the system throughout our organization. And we have about 10,000 employed physicians throughout Advocate Health. You'll see we have 27,000 nurses here serving this community in North Carolina. And the other thing I'm proud of is we have many of our hospitals are designated what's called magnet status. So the American Nurses Credentialing Center, they grant awards, if you will, or recognitions for those hospitals and systems that really meet their standards and very strict standards for nursing excellence. And so we have been also the recipients of that at the highest level. And I know Wake Med has as well. Our philosophy is this. If we take care of the people that take care of others, I think that's the best way to really help our communities we serve. So we are very focused on that in terms of our caregivers. In terms of advancing better health, lowering costs, and creating stronger communities across North Carolina, in the past five years, we've made among the most significant investments in health care, new facilities, and modernizing facilities in the state of North Carolina of $5 billion. Now, what we do know is that for every investment that we've made, we're typically creating about tenfold impact on the economic health of that community. So if you see that $5 billion investment, it's really projected to generate by 2029 a $53 billion in economic impact. What does that mean? Because whenever we're building, let's say, a new hospital, we're supporting small businesses and other community organizations that can participate in some of those investments. Then I'll get to the $1.5 billion in a second, but you'll see that in North Carolina, 375,000 Medicaid patients that we serve in North Carolina. And 100,000 patients do not even receive a bill for months. And so what that means is at 300% of the poverty level, the federal government sets the federal poverty level. And so if you're a family of four and you're making $100,000, you do not receive a bill if you come into Advocate Health or Atrium. And you see that's part of what's included in the $2.5 billion of community benefit that we provide. Now, I want to go to the $1.5 billion, because I think Donald has said this in different forums, that part of the challenges we've had as those in the field providing care to communities day in, day out, is that the cost of supplies have been very significant and the cost of pharmaceuticals. So they've increased 10% to 15%. And that's important to know because how can we absorb those costs and still deliver care and still provide care to communities? Because the challenge is this, and part of what I don't envy in your seats is that healthcare is really complicated. But let me try to just break down a little bit in terms of, as simply as I can, how we get reimbursed. So because sometimes this is, I have a hard time explaining this to my family around the dinner table, so I'm a little practiced in that. So about 60% of how we get reimbursed is Medicaid and Medicare, right? And we don't set the prices for Medicare and Medicaid. So that's the government that sets the prices. About 10% of how we get paid or reimbursed for services that we provide is charity care or those who don't have insurance. And for those patients, most of the times we're providing free service, sometimes if they can afford to pay, they'll pay sort of 11 cents on the cost of their care. And so how we absorb the increasing inflation and the fact that we're price takers as much as price setters is that we really try to focus on leverage our scale to really have less cost when it comes to supplies and pharmaceuticals. Now 30% of how we get paid is essentially negotiating with insurance companies, right? That's about 30%, 32%. And if you think about the last years, actually the price, the cost of inflation has outstripped what the increases have been to healthcare providers across this state. So that's really the economics that we're challenged with and it's why we are really focused on driving this significant amount of synergy savings from coming together. The one thing we know is important to this community and where that $2.5 billion of community benefit, if you just double click on that, what does it really mean? That's a big number. behavior health so we're one of the largest providers of behavior health in the state of north carolina we have three psychiatric hospitals one uh... i think it might be the only psychiatric or mental uh... health emergency department that treats both adults and pediatrics We have 330 mental health beds embedded in 10 of our hospitals. And you can see some of the other statistics there. We have 100 psychiatrists. And if you think about North Carolina, North Carolina has 100 different counties. 94 of the 100 counties have been designated as mental health shortage areas. Not enough therapists, not enough psychiatrists. The challenge is a lot of providers, because of the economics, have walked away. We've leaned in. In fact, for four decades, we are Mecklenburg County's safety net provider when it comes to behavioral health. We have a very comprehensive array of services, inpatient psychiatry, virtual health. So when I talk about having 100 psychiatrists, we're able to use our virtual health technology to reach the most rural community that we serve or the most urban community that we serve. We have teammate health, addiction services. We've invested a lot in opioid addiction services because that's a real issue here in the state. and you see some of the others. And quite frankly, part of the reason why we felt that we were kindred spirits when we first talked to Wake Med and the board and the administration was they brought up behavioral health as part of the initial conversation and said, what would it look like if we take your capabilities and your services combined with ours, what could we do with the state in terms of providing care for those in need? And there's about one out of five in this state or americans in general are dealing with a significant behavioral health issue so we believe by us coming together we can make a real impact and that's what we would intend to do the other thing here my sister is a public school teacher in philadelphia and so she tells me every single day we talk how underfunded they are and including just with school health nurses that there's not enough really to take care of the students that she sends there And so I believe we're the only major health system that is in 240 schools in Mecklenburg County and surrounding areas with virtual care in those schools to help when someone needs help. And we've treated so far 8,200 kids this year. And we are very proud of the fact that 60% of those kids, we were able to keep them in school. One of the things we know is that absenteeism is highly correlated with graduation rates. And so we'd like to say that if we're keeping the kids in school that need to be kept in school, that we're helping with graduation rates as well. And the other part of this is, going back to behavioral health, we also have behavioral health that is part of our virtual care delivery offerings, because kids as well are dealing with significant challenges there in the schools. So this is part of, when I double click on that $2.5 billion of community benefit, this is what it really means to real people. Let me just continue a little bit further on that, because one of the things we know is to keep a community healthy is not just what happens inside of the hospital walls, it's actually what happens outside of the hospital walls. So you see here that we've invested $1.4 million in reducing violence-driven injuries, and we're the only nationally recognized hospital-based violence intervention program in North Carolina. So what does that mean? If someone has a gunshot, comes into us to our trauma unit with a gunshot wound, and we know that right now public safety is something that we're all concerned about, then we do know that if we treat their gunshot and then we send them back into community just after we take care of their physical injuries, that they might be going back into a situation that will have them come back to us in the not too distant future. So what we do is we're working with community partners and we are wrapping around services around the victims of violence like that. So that might be psychiatric services, that might be looking for temporary shelter. And we found, and we do this throughout Advocate Health, that we make those investments actually we're preventing or reducing significantly the return to that injury. We have invested $20 million in affordable housing via the Housing Impact Fund. And I'm not sure if you're familiar with Roof Above. We have a partnership with Roof Above, and we recently helped them buy a building, essentially an old hotel, whereby we are housing the unhoused there. And 75 of the dwellings, if you will, are for those who are homeless that are looking to transition. And we help teach them how to essentially manage a household. So we're very focused in affordable housing. We've invested 2.6 million in food security. Some of us remember last year there was a gap in coverage through the SNAP crisis in 2005. As my team, which some of them are back there know, I said what we had to do, we got to immediately invest in food pantries because they're struggling right now. So we invested $1.1 million in food pantries throughout all of Advocate Health to make sure that we were dealing with the gap. And you see here as well, 40,000 food referrals to community partners. One of the things we've learned is that sometimes children, their best meals are during the school year, but from Friday to Monday, it's really hard to have consistency in that. And so we also have kids eat free meals. It's a shame that we even have to do that in today's society, but we do invest in those type of services. And then we've recently launched Care Everywhere Street Medicine. So we're going to these camps and providing compassionate medical care to those who are citizens that find themselves in unfortunate situations. So I just wanted to highlight some of that. We know that's really important to Wake Med. I know that's really important to this community. And it's a story that we don't typically tell, but we thought we'd share in this forum. Because we know that if you don't have a roof over your head, and if you don't have food to eat, and if you're a potential victim of violence, it's hard to be healthy. So we're really in community leaning in to all of those, what we call social drivers of health. It's not just here, though. It's throughout Advocate Health. Last Tuesday, I had one of those career moments that I'll never forget when I was on the south side of Chicago, and we announced the groundbreaking of a new hospital there. Now, if you know south side Chicago, there's a 30-year life expectancy gap between south side Chicago and a couple miles north. 30 years. I've seen 15, 16, and some communities I've never seen 30. And where most communities or most providers have walked away from that neighborhood, we've decided to invest. So we're gonna build a new hospital. It was the old US Steel building that had gone, land that had gone vacant for like a couple of decades. But we didn't just come there as Advocate Health saying we know what's best for this community. We had hundreds of listening sessions in the churches, in community forums, and we asked the community, what is it that you need from us? And they said, we certainly need a new hospital, but we need more than that. And what we do need is it's hard sometimes to access care on an ambulatory basis. So what we committed based on those conversations, we will have 10 essentially neighborhood care clinics throughout the community. We have three right now that we launched that are in churches right now. And we have others that will be in churches because that's where people know to receive care. to worship, and we want to make sure that the places that they go to worship, they can receive care. So we're very focused on that. And again, most in South Side Chicago have left the neighborhood, are not leaning in. And then we are also very big on rural care. We have 21 rural care hospitals throughout Advocate Health serving a million patients. Last year we released a white paper in terms of what the best practices are because we understand with those 21 that there are really some incredible best practices in terms of how do you keep rural providers from leaving the community and have them come back with incentives that you have, how do you leverage technology and so forth. When we say we're redefining care for all, we're talking about the most urban core to the most vulnerable rural community. Let's switch gears a little bit to innovation. We also know that healthcare is in a major inflection point. And what these medical students are learning today is gonna change dramatically next year and even more dramatically the year after. So last year, almost a year to the day, we opened up a new medical school campus in Charlotte. Charlotte was the largest city in the country without a four-year medical school, and that's part of our partnership with Wake Forest that you'll hear in a minute. But it wasn't just about a medical school. It was also about attracting the most sophisticated medical technology companies in the world to come, and also so that we can have our physicians work with these companies, some of which you may have heard, Stryker, Medtronic, Boston Scientific, Johnson & Johnson, Siemens. who have their latest medical technology and robotics in our innovation system district in Charlotte. And we've already trained 8,000 physicians in these latest robotics. And we're excited about the potential opportunity to have also the physicians from Wake Med participate in the latest technology as well. The other thing I'll say, we're on a track to create 12,000 new jobs because of this. And 40% of those won't require a bachelor's degree. I think that's an important statistic because sometimes you go to four years and you might not be able to afford the cost of your college. And so we have 40% that don't require a bachelor's. a bachelor's degree. The idea though of access to innovation is also a part of our for all mission. Last year I wrote a piece in the Harvard Business Review that talked about innovation and democratizing innovation in this country. And specifically I said that innovation that doesn't serve the underserved is at best incomplete. So we're very focused on that in a number of ways. One, we know that it takes 17 years for when there's a medical breakthrough to actually get in the hands of physicians to serve patients. And we said, that's too long. We also know that 5% of eligible patients enroll for clinical trials. And we said, that's not enough. And so we've really last year launched our National Center for Clinical Trials and really to bring the latest clinical trials to our most vulnerable communities throughout the organization. I will say my father died of multiple myeloma This is a rare cancer about 26 years ago. And part of the things I still look back is I wish he could have gotten the latest trials that were available at that time. And so right now we're really, this is part of certainly my personal motivation is to make sure that those who have this rare form of cancer or rare form of heart disease have access to the latest clinical trials. So right now at Winston we have sort of heart clinical trials that are leading edge and we're using that in Southside Chicago, or Milwaukee and so forth. So that's really, it's really a unique feature of who we are as Advocate Health. The other thing I'll say is that you'll hear, I'm sure some of you have read articles that, well, bigger organizations don't really improve quality. I can't speak for other organizations. All I can do is speak for Advocate Health and what we've experienced. And since we've come together, we've reduced, and these are two organizations that came together with very high quality scores to begin with. We've reduced mortality by 14% across the system. We've closed 230,000 care gaps, including, say, hypertension. And one of the things we know, if you don't get to hypertension early, it could result in a stroke, which is devastating, certainly for a family and the individual that's had the stroke, but it's also a much more costly way of delivering care. So we've closed 230,000 gaps. The other thing is, some of you may be familiar with Leapfrog, which is an independent company that evaluates healthcare quality of hospitals throughout the country. And when we started, we had five Leapfrog A hospitals, now we have 26. And we have 10 in North Carolina, which is more than any other system in the state of North Carolina. So again, I'm not sure what is said about other system. I can't speak for other systems. All I can do is speak for the metrics that we've been able to drive as Advocate Health. And national service lines, so we have among the largest national service lines in heart, in cancer, and in neurosciences. And so we really have one standard of care that we bring to patients who come in for those conditions. But also, we also excited about some other key services that we have. We have the seventh most recognized acute rehab hospital in the country. And we have Levine's Children's Hospital that's been recognized 18 years in a row by US News and World Report for its quality. And in fact, at our Children's Hospital, we have attracted about 100 new physicians in the last three years. So we're trying to keep the main thing the main thing, which is how we continue to improve quality and really drive our excellence throughout the system. Let me just prepare with some closing remarks. One of the things that when we had the conversation with Wake Med and the board, the conversation that we talked about is the reason we came together is because there's sober realities that are faced in healthcare. And it's the same sober realities that you're hearing from Wake Forest, from the Wake Med board, and the same that we discussed with Wake Forest board when we came together. Intensifying financial strain. Medicaid reduction should begin here before too long. Behavioral health demands that I talked about. Workforce shortages and an aging population. Persistent gaps and inequities. Cyber security threats are accelerating and AI is reshaping everything that we do in healthcare. And so this is the sobering reality that if you're still doing well today, you really want to make sure that you're addressing and shoring up your capabilities for that future. So that's why we said yes. I think we've probably said no 20 times to every one time that we've said yes as an organization, because with Wake Med, we found kindred spirits in terms of care for all, leading clinical excellence, building a future forward workforce, and long-term sustainability. What does success look like? So if we're here five years from now, we can't write the headlines from today. There'll be headlines that come out of these conversations. But here's, if we had the pen, this is the headlines we would write for five years from now. The $2 billion investment delivers 3,300 jobs and supercharges one of Wake County's largest economic engines. And that is the investments that you hear about in terms of expansion in Raleigh, Cary, North Hospital, and Gardner, and so forth. We would write the headline that one million more North Carolinians now have access to care without having to leave home. We're the largest provider of hospital at home in the nation. So think about it as converting your bedroom into a hospital room with all the sophisticated equipment. So we are trying to bring care to where people live. That North Carolina's largest not-for-profit mental health network opens redefining care for thousands, and that is part of what we are committing part of the capital to that we've discussed. That we're closing the gap through community partnerships that deliver on measurable health gains for North Carolina's most vulnerable, and I spoke a little bit in terms of how we partner with community in that regard. And then from training to breakthroughs, innovation corridor powers the next generation of healthcare in North Carolina, because we do know there are shortages in healthcare workers, and we believe that together we can train this next generation in the latest innovation. So one of my favorite quotes is that the best time to plant a tree was 20 years ago, the next best time is now. We do believe that this is an opportunity now to plant for the future. And I'll just say there's a, biblical verse in Matthews that says, you will know them by their fruits. And so we want to be judged by our fruits. And to that, I'm going to bring Dr. Kevin High, who was there really in Donald's position when we came together with Wake Forest, leading this integration a little over five years ago to talk about what we've done in that time. So Kevin.

Do you wanna go back from the slides we've seen?

Is that the questions you're talking about?

Yeah, I do have some questions about the slides. The one that talks about the housing and the, Did you do that just on your own or was that part of a community benefits agreement in Mecklenburg County?

We did that. There was no agreement. We did that on our own. So that's the housing impact fund that was part of it. Then working with Roof Above, that was, in fact, we embedded community health workers as well. So there was no agreement to do that. That's just part of what we thought was important for the community.

Would you put that in agreement to do that in Wake County?

We have discussed exactly that. How do we help with housing here? Because we know affordable housing is an issue here. And in fact, we also donated 14 acres of land in Uptown Charlotte for affordable housing. So we'd like to discuss opportunities and find out what the needs are here so we can support them. Thank you.

And when you talked about the 100,000 folks that got... Of course, we've been talking to other commissioners about what their experience has been. So when you talk about the 100,000 folks that got indigent care, Did they have to do any deposit up front? Do you know going in it's indigent? If I'm somebody who needs my knee replaced and I'm indigent, I can't afford to do it. How would I come to atrium and get my knee replaced if I live in the community?

Yeah. Well, you come in and sometimes you're pre-qualified. So we have a conversation with a financial counselor to say, what is your financial status? And if you are at 300% of the poverty level, which was set by the government, I think, in 2009. So if you're three times of that, then if you come in, then you don't receive a bill for us. When we came together as Advocate Health three and a half years ago, that's one of the first thing we did is make sure that raised our charity policy to 300% of the federal poverty level.

Right, but so I wouldn't have to make a deposit up front?

No, not at all.

Okay. Yeah. Okay, thank you. Commissioner Walters?

Thank you so much for this really helpful information. I'm really intrigued by the school-based virtual care. That is something extremely meaningful to me. Could you talk a little bit about the collaboration with the school district and the process and the barriers that you had to address in making that come to fruition?

Yeah, well, I think I'm sure like many public school districts, it's a challenge to really to take care of kids and improve grades, improve graduation rates to prepare them for this competitive landscape. And so we've done it a number of ways. One is early on, one of our partners was Bank of America. We went to Bank of America and says, can you help us support a pilot program in the schools, Mecklenburg schools, so we can get care to children in different ways? And so we worked together on that. It's not just kids though, because what happens is parents sometimes have challenges as well. So we have it so that if they pick up their child and the school, we can also have that care site for the parent as well. And one of the things we're finding out for the 60% that I said we're keeping in schools, sometimes they just need medications. They don't need medications right then. So we will, a lot of times, call the parent, call CVS or Walgreens and say, we will call in the prescription. You don't have to come pick up your child, but on your way from work, you can pick up the medication. And so when your child goes home, then you'll have that medication. So it's a pretty comprehensive process. That's not all that we do. We also found out that some of the times that what public schools face is the lack of all the expertise. We've got a lot of good-willed people working in administration, but they don't have all the, like how do you do benefit administration? Or how do you really do major change projects? So we are one of the organizations in Charlotte that we embed, we call our Executive and Residence Program. So I need to figure out the exact number, but I think so far we've got seven or eight executive in residence. And basically what that means is we take a manager that's in our system and we loan them to the school for a year. And then we promise them that they'll have a job when they come back to us. And that's been extraordinarily successful. If you have a chance to talk to Dr. Hill, who's the superintendent there, and you see the scores in terms of all the improvements that that school district has had, I'm not going to put words in her mouth, but she will say this executive and residence program has been one of the key factors in bringing the expertise that they need into that. So we basically embrace the local school districts and the public schools because those kids need that type of support. We also have STEM programs. So I mentioned the PEARL. There is nothing like having a fifth grader or sixth grader go into the Pearl, put on these virtual reality glasses. I was at a STEM. We had about 400 kids there a few months ago. There was Legos and things of that nature. And we know that we changed the dinner conversation that night. Whatever they aspire to, now they're like, well, can I do this? Can I do that? So we're also embedded in the school district in a different way. We have rotations that come through our Pearl, through our Innovation District, so the kids are exposed to other career opportunities that they might not have envisioned.

Thank you so much for speaking to that.

Thank you. Thank you, Mr. Woods, for the information. I'm looking at the slide that talks about strategically partnering with municipalities, leading academic institutions, and community organizations. Similar to Commissioner Adamson, I've reached out to colleagues. I've heard great things, like you mentioned the Pearl. I've heard great things from the Hornets Nest Girl Scout Council about the STEM work that's happening in the Pearl for young people, and also from County Executive David Crawley, who's in Milwaukee as the— chair of their board of commissioners there about the work that you're doing considering the disparities that exist in Milwaukee specifically for African-American men. But my question really is around the business community. You talked a lot on this slide in particular about how you brought the business community and church and neighborhood care clinics together. Can you talk a little bit about how those partnerships formed? Because they seem very robust. So how do they form and how do you maintain them?

Yeah, thanks for the question. There's a number of answers to that. One is we have a whole division, community impact division, that Ms. Kaneel Coltman back there oversees. And so we have folks dedicated throughout Advocate just to focus on we've got pretty sophisticated data. Where are the gaps? I've mentioned the 230,000 gaps, but this is how do we engage with community impact? And quite frankly, the community partnerships in Chicago will look different because there's different sets than we do in Milwaukee, than we do in Charlotte. But we really work with a robust set of not-for-profits out of that community impact. So we have a whole team that all they do is just dedicated towards that. In terms of the business community, last year, I'm now past chair, but I chaired what's called in Charlotte the Charlotte Executive Leadership Council, CELC. And that is, we meet every month, and it's the CEOs of all the major organizations. And you might think that CEOs sitting around the table are going to talk about certain things like the future of technology and things of that nature. This group took seriously 10 years ago that there was a Chetty study that came from Harvard that said Charlotte was 50 out of 50 in the country in terms of upward mobility. And what the business community said, that is completely unacceptable. And so we really have worked on things over this 10 years that I've been here, preschool education. and also supporting the arts. And now if you look at that study, that Chetty study, we have made significant progress. So it's this coming together with non-profit organizations that are doing great work under increasing strain and then mirroring that up with health systems and then mirroring that up with business community that's been sort of the secret sauce. And there's a lot of energy in terms of what else we can do. Obviously, there's a transportation initiative that just got passed that will invest $20 billion in the Mecklenburg County area. One of the things we're focusing on, though, is making sure that the benefits that come out of that investment are shared universally through the community. So we've harmonized all our workforce development programs. I don't know in this community, but sometimes there's a lot of duplicate efforts that are happening, and people aren't really focused on what is the holistic approach to that. So we're now partnering with the city the county, the business alliance, and the health systems to make sure we have a workforce pathway that everybody, it'll be like a 1-800, this is where do I plug in to get employment. And so that's what we're building that infrastructure to, to support the transportation investment, but other opportunities in Charlotte as well.

Thank you. That's helpful. I think that I have heard from some of our partner agencies that already partner with Wake Med, that we do great work with. How does that translate if something like this were to occur? And so just wanting to know what you said about the community impact division and having that local to a community. Because you're exactly right. What works on the south side of Chicago does not work in Milwaukee. And what works in Charlotte does not work in Wake.

And I'll say that again, Mr. Manager. What works in Charlotte does not work in Wake. Right. If you've seen one county, seen one county.

And so thank you for that. It's very helpful to know that our partner agencies will have their own seat at the table to form what community partnerships and alliances can look like. Thank you.

Thank you. Thank you, Commissioner Thomas. Commissioner Jackson.

Yes, Mr. Woods, thank you so much. Many folks around this table know and in this room that I'm from the south side of Chicago, so whenever you say that, it just brings...

I saw you smile a little bit when I said it.

Yes, and throughout all of my birth to 18 years, I was an advocate patient, so I have a very special connection. And my sister works at Advocate Trinity, which is being rebuilt. And so her and her colleagues have a lot to say about the investments that are coming to the South Side of Chicago. So thank you for that. My question that builds from that is, I remember when the— Combination happened several years ago. And as an advocate patient, I was like, whoa, whoa, what's going to happen? So I've been following it very closely. I would like for you to share a little bit about the locally focused part of your vision. What have you learned in trying to maintain the locally focused? What's worked? What's not worked? What have you learned specifically to ensure that through these combinations and arrangements that locally focused is prioritized, as you mentioned?

Yeah, and it's embedded in a little bit of what we shared just to get to the south side. We did have, we were, I don't know how many listening sessions we had in the communities, but we, just like we would do here, as you start by listening, we're also, Commissioner Thomas mentioned Milwaukee. We're also the learnings we had from Chicago. We're also Applying in Milwaukee and we in one of the poorest areas in Milwaukee We're launching what's called the beacon which is the beacon is essentially we're providing care But it's going to be other community services in that in that neighborhood and so the things that we're learning is essentially each community is different and every community has different needs, but if we start with that listening, that we really can better ascertain what they need that's different. Now, there's things that are common, too. What we're finding is affordable housing is a common issue, food insecurity is a common issue, and all of that, so then we can apply the system level playbook that we have across the different places that we serve.

Awesome. My other question before we continue is it was very notable to me that when Wake Med was reaching out to expand their oncology impact that they put out an RFP. You all were the only one to respond. Can you just talk a little bit more about what led you all to respond? And then on the other side of that, I appreciated the sobering reality slide and really summarizing the trends that are happening in the mental health not mental health, but healthcare field in this country. Can you, in addition to what made you apply and go forward with that oncology, can you talk a little bit about how this arrangement would directly address and account for this sobering reality?

Yeah, and so first on the oncology, I've been here for 10 years. I've known about Wake Med since I had stepped foot in the state, and I've known them to have top-notch quality care, top-notch physicians, very committed board. And so to me, when it was presented to me, it was kind of a disconnect given the need that existed here uh... why they didn't already have what i would consider a basic service uh... it was it was and so when i talk to my uh... team and kevin knows uh... we we already had we also had you know linear accelerators nearby and so the question was will that conflict no let's look at the need there they're very high quality organization and it's it's it's um... and if we're going to lean into our mission in north carolina so that's why we responded we did not know that we were the only one in the state to respond we we had and we thought that were I mean, the need is very clearly laid out there that there would be a lot of other systems that would have responded, and they didn't. So Donald said, you were the only one to respond. And then we had our physicians talk to physicians. And so Donald and Thad mentioned earlier, it felt like we were the same organization. So my physicians would come back and say, wow, they feel like they're committed to the same things that we are. excellence, but also community. And so that led to further conversations. But we responded because there was a very significant need and we were amazed that it hadn't already happened. So that's when in terms of sober realities, if you look at here, The intensifying financial strains, I alluded to that earlier, but for advocates' ability to drive $1.5 billion in synergy savings, we would have, as a system, a lot of financial challenges that we might not have otherwise had in terms of just operating margin. And it's important to know that most health systems If at the end of the day, at the end of the year, they have three or four cents on the dollar from an operating margin, they're doing better than most. Most do not have even three or four cents. So the margins in that are really thin. So we believe that our ability, and Donald's mentioned it before, to help lower the cost of supplies, and drugs will be very helpful. If you look at behavioral health, we talked about combined, we intend to create the premier behavioral health network in the state. Workforce shortages, right now through training the next generation, that's part of what we are looking to do together. The gaps and inequities, we just talked about all of our focus and we would be leaning in, listening to this community in terms of how we can augment the already great work that Wake Med is doing. I think there's a fear that an organization that comes out from the outside that doesn't really know the different community not-for-profits will all of a sudden make arbitrary decisions. We haven't done that in any single community that we've served. In fact, we've leaned in. Donald has already told the team, these are the organizations that we work on. We can do better here. We can do more here. You need to talk to them and things of that nature. And together we can. So that would be a focus here. Cyber security and AI, I put that in the same bucket as technology. Right now, I could say that even before we came together as Advocate Health, I now, as an organization the size that we are, can recruit the top talent in the country. to support cybersecurity and AI and other technology needs. So that will be essentially what would be made available also to Wake Med without them having to invest in the infrastructure that we've already invested in. Now, they're doing a lot of incredible work there as well. So this isn't about that. This is about preparing for the future. So those are some of the ways that we believe. Wake Med does not need sort of anything tomorrow the next day i think this board and what i've heard from this board and and and the administration is they have a responsibility to think beyond today and tomorrow they need to think 10 years out which is what our board did when we came together and because again we didn't have to the best time to come together is when you don't have to It's about a vision and it's not that you're having financial challenges. And so we believe that the same case exists here than when we came together as Advocate Health.

Awesome, thank you.

Commissioner Adamson, did you have another question? Okay.

I'm not going anywhere, so I'll be staying here. If there's more questions, I think I'd like to introduce Dr. Hai, if it's okay, to explain what the experience has been in Wake Forest. Thank you.

Let's get to the right spot here. Okay. So, I'm Dr. Kevin High. It's nice to be here with you this afternoon. Really appreciate the invitation. I would add one other challenge to what Jean was talking about in the future. It's embedded in all of those, but Dr. Rasu Shretra, who's one of our colleagues, says things have never changed so fast in healthcare, and they will never change this slowly again. And he's absolutely right. Things are accelerating dramatically and the resources needed to responsibly, fairly, and appropriately invest in these issues is really important at this point in time. And it's one of the reasons why six years ago, we went through a very similar process at Atrium Health Wake Forest Baptist, which at the time was Wake Forest Baptist Health. uh... and i am currently vice chief academic officer for the learning health system at advocate health and i've been a faculty member at wake force university for thirty three years but today i'm here as a historian uh... because past is prologue and the best way to predict behavior i think is to look at past behavior i became president of wake force baptist health in twenty fifteen and then was president of Atrium Health Wake Forest Baptist from 2020 to 23 after we came together with Atrium. Before we came together, I was involved in a number of grassroots discussions with several other organizations. And through a long integrated process, we decided that Atrium was the best partner for us. They were an excellent cultural fit. They valued and wanted to expand our academic footprint. And they had a collaborative spirit and a desire to help the underserved that was the bedrock of what we did at Wake Forest Baptist Health. In fact, it was right there in their mission statement, health, hope, and healing for all. And that for all piece is not just a saying, it is part of what we do every day. Of course, we were the smaller entity in this discussion. And we had a lot of the concerns that I bet you have today. Would we lose our identity? Would we become a cog in the machine? Did they mean what they said and would they really deliver on the promises? Remember this was late 2020 and all of healthcare was really collapsing under the pressures of the pandemic. And it would have been very easy for Atrium to say then or over the next several months or years of challenge from the pandemic, well, we know what we promised X, but things have changed under COVID and we can really do Y. And they never said that. They followed through with the original agreement as it was laid out. I also had experience on the board for the North Carolina Healthcare Association and had seen other deals elsewhere in the state that did not go as desired or expected. And I'm here today to tell you that we are exponentially better five years later after this deal was initiated, and they have delivered in every way. It's been a true partnership, not a takeover. Some of the best ideas and care models came from Wake Forest Baptist Health. Some of the best ideas and care models came from Atrium Health. But far and away, the majority came from us asking, well, how do you do it? And Atrium saying, how do you do it? And the third way, we combined the best of both, is the way we moved forward most of the time. It was a very collaborative process. Talent from Wake Forest Baptist Health was not dismissed. It was recognized, and many of the folks from Wake Forest Baptist Health are now leaders in the larger atrium and advocate health organization, including the chief supply chain officer and the chief financial officer. We were integrated. We were not taken over, and we became part of a bigger family.

So several

Examples, I think I have, yeah. So this is from a op-ed written by members of our board. And this was written not right after the deal was done, it was written just a few weeks ago by Matt King, Don Flo, and Bill Warden. And what made this combination work has been a shared commitment, not just to preserve what made Wake Forest Baptist distinctive, but to elevate it. And our strengths were amplified and in many cases became defining strengths of Atrium Health itself. And we're confident the same thing will occur as a result of Wake Med and Atrium Health coming together. So what have we accomplished? Well, we've gotten new critical infrastructure with a new ER, ICU, OR tower in Winston-Salem, multiple ambulatory surgical centers, an Eye Institute that we've been able to open, new clinics in underserved high poverty areas in East Winston, New equipment and services like focused ultrasound that has really revolutionized care in patients with severe tremors where in less than an hour they come in not being able to write their name and the next hour they can draw a clock and sign their name in a normal way. It's amazing to see. Community infrastructure was supported, including Metropolitan Village, the affordable housing complex in Winston-Salem that was funded in part by Atrium Health. It made us stronger in our own communities, bringing greater choice to the patients in Greensboro, where there had only previously been one option. We've added multiple offices and have an ambulatory surgical center, two freestanding ERs, and a hospital that are approved and under construction there. But we also had a commitment to the region we served. And I like to say we wanted to fill from the outside in. We did not want to pull patients to Winston. We had plenty of patients in Winston. This was not a hub that was gonna draw from each spoke. We actually wanted things to go the other direction. where we had the hub we could bring services to those hospitals. And we did that all throughout our region with virtual ICU, hospital at home, telepsychiatry care embedded into primary care. And we were able to bring better service to more people at lower cost. Now, I'm sure you've heard concerns from other parts of the country about how healthcare deals can lead to reduced services or closures in underserved communities, but I can tell you that's been exactly the opposite of our experience here. We were actually able to afford additional charity care policy. Our policy was not as generous as Jean talked about. We couldn't afford that before. We could now. We expanded that, and we were able to give thousands more patients free and deeply discounted care. I also am proud to say that we likely stopped the closing of two rural hospitals in North Carolina, Hugh Chatham Hospital in Elkin and Allegheny Hospital in Sparta, that we could not have afforded to help if we weren't part of the bigger atrium and advocate family. So in closing, I'd just like to say that the combination of Wake Forest Baptist, secured with Atrium Health, not only preserved our stature and legacy, but expanded its reach. It allowed us to not just survive, but thrive in all aspects of our mission. Care, education, research, community benefit, care for the underserved, And it put us in position for our region to help meet the significant challenges that we're facing right now, like how will you responsibly develop and deploy AI? How are we gonna address these shortages of doctors and nurses, which every organization projects? And North Carolina is one of the places those shortages are greatest. And we need to keep investing in cutting edge technologies, equipment, and our people. That's happened at Wake Forest Baptist when we came together and are now Atrium Health Wake Forest Baptist, and I suspect and believe it will happen with Wake Med as well. Thanks a lot for the opportunity to speak with you today, and who do I pass it off to? All right. Do you have any questions for me?

Yeah. I have a question. Sure. I noticed as part of the merger, you received a $3 billion investment into the community. How did you get that and how does that play into the success of the merger?

There was a $3.4 billion investment total made. It was not in only healthcare per se. We were, of course, expanding the medical school in a second campus at Charlotte. There was investment into our research activities that was part of that as well. But it is the reason we were able to build the ICU OR ER tower that we just opened about nine months ago now. It's the reason our Eye Institute is gonna open January of 2027. It's why we built those clinics in East Winston, which we could not have done before. So that investment was rolled into those spaces. And in fact, I didn't mention it because it was in a slide that I skipped over and I apologize about that. But we've had ratings improvement each of the last five times we've been rated by the ratings organizations. and that's made it easier for us to invest going forward when you have better ratings. So not only have we been able to do that with some of the investment that we got as part of the deal, but we've been able to put ourselves in a better position for future investment.

Thank you, and just one more question. One of the concerns I've heard from the community is that there's a shortage of places for medical students to do their residencies. And I've heard concerns that the Wake Forest Medical Center medical students will come to Wake Med because Raleigh is obviously a place a lot of people want to live and want to come here. And it would displace the other medical students that are here. Do you see you sending them here as opposed to, do you see that as increasing?

I see that only if they're asked to be here, right? And they may well be. That's one of the better ways to recruit people, frankly, is to have them do rotations in your system. But there are no plans that I'm aware of at all to displace any students that are currently in Wake Med. We did not displace anybody in Chicago or Milwaukee, even in closer places like Georgia. We have affiliations with Mercer in Macon. We have affiliations in Chicago with half a dozen medical schools. in Milwaukee with MCW and University of Wisconsin, et cetera. We really have no plans to come there with additional folks unless we are asked, and there is a work shortage, and we are happy and able to do that as a private institution. We can go to those places if asked, but only with invitation.

Thank you. One more question and then we'll move on to the next presenter, Commissioner Thomas.

Actually, I have more than one question, sorry. Commissioner Adamson made me think of a question that I didn't already have. When we talk about recruitment and retention, what does recruitment and retention look like from universities like Meharry and Howard and Morehouse School of Medicine?

Yeah, and we've had quite a bit of discussions with Morehouse. I don't know if you want to say more about that, but we, you know, we, we've met with them many times and have strong ties with those that administration at Wake Forest School of Medicine and and Morehouse are very close. We have made. Inclusive hiring, a major, major part of what we do, including retention and training. We have very strong talent pool now because of who we are and what we do. And so I think it's been a tremendous plus for us. We are a more diverse, more talented pool now than we've ever been at Wake Forest Baptist because of that.

If I could speak just a little bit about Morehouse. Actually, a couple last year, they had challenges in a vulnerable community in Atlanta in terms of opening a primary care clinic. So we were actually working with them on that in some vulnerable neighborhoods. And then also, Dr. Valerie Montgomery-Rice, who heads Morehouse, she has the same. It's sort of what was talked about before. She's looking for more sites for rotation. And so we're having conversations in terms of how we can also work on that so that they can have rotations from Rome, Georgia to Macon, Georgia. And so we're actively in conversations there.

Thank you. That's helpful. So my initial questions were, Dr. High, how did your community ensure that you maintained meaningful influence after the transaction was complete? And what are some best practices that have worked to preserve that? local voices?

Yeah, it's a great question. To me, the most important ability to work at Atrium Advocate Health is the ability to function in a matrix. You can't have a hierarchical organization when you are so large and so diverse. You have to have a matrixed organization.

So tell me, I'm sorry, tell me what that, what that means.

It's not top down. Okay. It's broad and flat.

Very good. Thank you.

Right. And so broad and flat means that you have influence. You have this illusion of control, I would say, in a hierarchical organization because you hire, fire, put pay rates in. But the most important influence you can have is your relationships with people across the organization. And this functions as a very flat organizational chart within Atrium Health and Advocate. And so we've maintained our local board, we've maintained our local leader in Donald Ginsick's position. We've hired them with input, of course, from Atrium and Advocate Health. But all of the local influences and the reasons that things develop locally are often because the resources are different in your community than they are in the other. So you leverage the correct resources in that space. And that's listened to and understood in this organization.

Okay, and then my last question really is about financial sustainability. What does financial sustainability look like for your community and for your physicians and for the people that you serve? I think often we hear about cost increases when things like this happen. I believe that some of those cost increases come from insurance companies and not necessarily from systems or facilities. So can you tell me a little bit about what cost has looked like and how it has changed since this has happened in your area?

Yeah, a couple of things. As Jean mentioned, the highly functioning health systems make three or four cents on the dollar at the end of the year in margin. If you think about it, just from inflation, two and a half cents of those three or four cents is already eaten up just by typical raises you will have to give. So the next year you have to innovate. Again, to just get the three to 4%. Every year you have to squeeze additional efficiencies in order to get there. And that's because we are takers of 70% of what we get paid, right? It's Medicare, Medicaid, and self-pay. So you have to be good at becoming better every year to get to that spot. And we've been able to benefit from that through the Atrium organization without then raising rates because what you get is the ability to change what people pay in their aspect. So the better poverty level fee schedule that we've been able to implement, we were not that good before. We have been able to actually get better at what the least fortunate are able to pay. We can lower their bills rather than raise their bills. And so I think that's a really important aspect of being bigger helps you actually get more efficient. And that efficiency is what helps you keep rates down.

Thank you. That's helpful. I would like to learn more about squeezing additional efficiencies as a county person trying to manage a budget. I appreciate you. Thank you so much.

Okay. I think Commissioner Waters had a question. And then after her question, we're going to take a five or ten minute break before the next presenter comes on.

Thank you, Chair Mayal. One of the slides you listed raising minimum wage to $18.85, is that number from 2020 or is that the current?

That's the current rate, but in 2020 we were in the $13.50 to $14 range.

And I know there are different ways to calculate a living wage, but is that considered a living wage for your community and is that the starting wage across Atrium?

It's not the starting, it's actually on the lower end, I think, of the starting wage at Atrium. It would probably be more in Charlotte, I would think, Gene, is that right?

Yeah, actually, we increased all the minimum wage this past year at $18.85. We were in different stages throughout. Like, Georgia had different minimum wage, but we took everybody out to the $18.85 of a starting rate. I think the federal minimum wage is $7.25 or something like that. So that's the standard throughout the system.

Okay, and does that... Well, I guess that's the start for all. So do you do any research or evaluation of living wage for particular communities to ensure that your teammates can afford to live proximate to where they work? That's an important conversation that we have around county employees and making sure that they can afford to live proximate to where they work.

yeah we do that number of ways one is certainly through through the minimum wage the other the other we have established uh for lack of a better way is also a teammate help fund so we have uh i'm thinking 10 million dollars in that fund right now or more that when a teammate is sort of needs help with uh transportation or help with so they can actually apply to this fund that we have We also work with the public health and transportation to try to make sure that we're in the right neighborhood. So it's a combination. It's not just minimum wage. It's other ways to support our teammates.

Okay, thank you. I know Wake Med has been a great employer for a lot of entry-level workers. And I just wondered in the transition for Wake Forest Baptist, did you all experience any of those very entry-level position being outsourced? I know that's sometimes a concern where positions like housekeeping get outsourced and people who really depend upon those entry-level positions for solid benefits and pay and opportunities to advance. Did you see any of that change?

No, we did not. In fact, it went the other way. We had ourselves outsourced some of that and were able to bring quite a bit of that back in-house, especially billing collection. Some of the places where it's, when you're a small organization, and I know $3 billion doesn't sound like a small organization, but it is in healthcare. And you have to look for those efficiencies outside your organization. When you're a bigger organization, you can bring all of that in-house, and we were able to actually increase. That's part of why we created 8,200 jobs, because of this combination.

Thank you. And lastly, can you speak to how employees can start at an entry-level role and then look for opportunities to advance, including... additional training and opportunities to grow their career.

Yeah, I'll start and then Jean you can chime in here. One of the advantages of being an educational organization is we think about that a lot and we partner with HR throughout all of our organization in order to have specific training programs that can move people along specific pathways from from CMA to nurse, from CNA to nurse, from nurse to nurse practitioner, from transport into patient relations, and a variety of other ways that you can actually create career ladders for folks. And again, being a bigger organization helps us to be able to have space to go and ways to move up in the organization. Gene, you wanna add anything?

We have a whole area in human resources that focuses on career laddering. And some of the challenges, and I could be here for the rest of the evening telling stories about a certified nurse assistant that became a nurse. But part of the challenge, if you have a family and you're working, that you can't necessarily stop working. So how do we provide those wraparound services? Sometimes it's childcare, support for books, and things of that nature. So we have a whole area of our HR division really focused on this. I don't have the number on top of me, but it's in the thousands just last year alone that we've helped with career laddering.

Thank you, very helpful to know.

Okay, let's go ahead and take about a 10-minute break. Thank you, everyone, for coming back. I know that was a much-needed break for everyone, so let's go ahead and call the meeting back to order and go ahead and proceed with your presentation. Thank you.

Good afternoon. My name is Mary Nash Rusher. As I mentioned before, I'm a member of the board of directors. I am also a member of the executive committee and was on the task force. So I've been living with this transaction for a very long time. What we're going to do next is there are several board members here because we heard from you that you wanted to hear from the board. You've heard from our chairman, Dr. McDonald, laying out to you sort of how we walk down this road to get where we are. You have asked us many questions and we appreciate that. What we have tried to do for this presentation at least is to pick some categories of those questions and answer them sort of as a group rather than doing a long sentence. These are questions that arose both from all of you and from the community as we were talking with you over the last few weeks. We've just put out the key deal terms. You've heard these a lot before. I'm not going to go over all of them. I'm going to focus on two. The first thing I want to focus on is just to remind us all that this is not a sale. We are not selling our assets. Some of the deals that this has been compared to were in fact sales of assets. This is instead creating a new partnership, a strategic combination. Key factors in making it not a sale. We remain a separate North Carolina nonprofit 501c3 organization. We have contracts with community partners. We have contracts with insurers. We have contracts with physicians. All of those stay in place. Those all get negotiated as we go further in life. Will the terms of those change? Likely, they would change anyway. But we remain who we are. We retain title to all of our assets. Our assets are our assets, and they remain titled in the name of Wake Med. We don't, there isn't a purchase price. The two billion is not a purchase price. It is instead a strategic investment in our hospital system and in our county that will be made collaboratively between Wake Med and Atrium. The second thing, and we have talked a lot about this, and so I know already from listening to you talk with Baptist, that local control is just really important to everyone. So as a reminder, we are currently governed by a board made up of 14 board members. Eight of those are Wake County residents whom you appointed. I'm one of them. Hope you don't change your mind. But I'm one of your board appointed directors. And after this transaction closes, as we hope it does, there will be eight of 14 board members appointed by Wake County. So that makeup of our board where a majority of the board members are Wake County board members will be the same. The Wake Med Board and its leadership will retain control over the day-to-day operations that are best managed at the local level. You heard a lot from Dr. High about how that has happened. in Winston-Salem and Greensboro and surrounds. And it is the expectation that that is the way it would happen here. There are specific things that the board will remain responsible for. It will remain responsible for the preparation and operation, preparation of the operating and capital budget the strategic and capital plan. It'll remain responsible for any change in the mission of Wake Med. It will be responsible and have the power to do what it needs to fulfill the bond covenants, to operate licensed medical care facilities, to credential and appoint medical staff, and to maintain standards of care and quality assurance. And it will remain responsible for ensuring that physician, APP, employee compensation remains competitive in our market. We've also heard from Baptist, and I'll have to say I am always comforted to realize that one of the most important things that happens at the local level and you all know that how much it happens here are community partnerships so much of what we do we do with others we can't do it on our own and understanding and recognizing that that our input on those community partnerships remains paramount was really important to the board as we made this decision so What is it that we're asking the county to do? As a reminder, in 1997, the county and Wake Med entered into a transfer agreement when the county, which at that point actually owned and operated the hospital, transferred the hospital to this newly formed nonprofit corporation called Wake Med. I think it had a different name then, but it's now Wake Med. Two key things in that agreement. Number one was a commitment from this new nonprofit that going forward, it would maintain what was then the level of what in the agreement was called indigent care. The IRS now calls it charity care, but this is uncompensated care provided in the uncompensated and Medicaid care provided in the community. to at least 4.8% of total adjusted revenue. I'll just let you know that in 2025, our fiscal year, which ended in September, we provided charity care at a level of 12.8% of total adjusted revenue. So we meet and exceed that goal, but 4.8 is what's in the agreement. And then there's a provision in that transfer agreement that says if Wake Med violates its charity care policy, or if it ceases to operate I'm gonna read this from the agreement. Ceases to operate as a community general hospital, open to the general public, free of discrimination based on race, creed, color, sex, or national origin. If either of those two things happen, we stop being a general community hospital or we don't keep up our charity care, then the hospital reverts to the county. So those were the underpinnings of that transfer agreement. The third leg of that was the way the directors are appointed, which is incorporated in the articles of incorporation that are on file the Secretary of State's office. So what we're asking the county to do is to approve this amendment to these articles of incorporation to allow us to now have a member. We didn't have a member before. We would have a member, which is Atrium Health. Atrium Health would then have some oversight over some of the things that we've talked about in the operation of the hospital. But local control would remain on the things that are listed and in our community partnerships. So the amendment to the transfer agreement would essentially approve the change in the articles and it would reaffirm the commitment to charity care and reaffirm the reversion that happens to the property if those key things aren't met. So side by side, because you know we like lists. You can sort of see how we would be before and how the new board structure is afterwards. So they picked one of the lawyers on the board to stand up here and explain to you sort of the corporate structure and what would change. So I'm gonna now turn it over to my fellow director, Margaret Bratton.

Thank you, Mary Nash. I'm Margaret Bratton, just a reminder, and I am vice chair of the board and on the executive committee and also a commissioner appointee. So during what we gain and what we lose. During our due diligence period, we began to identify the benefits that Wake Med and the community would gain while coming to terms with what we would lose. We recognize that we would lose full governance autonomy while retaining local control, and that's important, while retaining local control. And at the same time, we recognize that we would be able to relinquish the burden of full responsibility of both navigating the financial uncertainty as well as the industry headwinds, the sobering realities that Mr. Woods referred to. What the two billion would do for our facilities is huge and completely necessary, especially at the Raleigh campus if we are going to continue to serve Southeast Raleigh and beyond. Like you, Commissioner Waters, one of the gains that we are most excited about is the ability to flip the switch on virtual care in Wake County, which greatly enhances access for all. Atrium has done this beautifully in Mecklenburg County. We, too, can do this in Wake County. Virtual care removes transportation barriers costless and connects patients to the best care Wake Med provides outside the hospital walls. It keeps children in schools. It keeps parents working. This, of course, and maybe most importantly, includes the mental health care for all Wake County students and as well as their families. Building commitments, community investment. As you know, the two billion in Wake County and community investment over 10 years would be transformative for mental health and medical care and for the underserved and for our capital projects. community involvement and needs. The tri-annual community health assessment guides our implementation plan to meet needs. That process will not change. With Atrium's financial support and the commitment to mental health and behavioral health, we will be able to expand our support of Wake Brook, and build out our garner whole health campus which is going to be outstanding and beautiful and we'll be able to better support dr brian clausner our community hero who continues to address the chronically unhoused and underserved with unparalleled compassion and care his programs in street medicine really are changing lives public accountability Since 1997, Wake Med has reported to the commissioners. This report includes our financial audit, key services, how we are addressing equity, serving the underserved, volume growth and progress on big projects. We also report out on how Wake Med exceeds our charity care requirements. Our community benefit is almost a little under 400 million. It far outweighs the tax benefits we have as a nonprofit. Atrium's $2 billion capital commitment will help implement our plan on addressing concerns identified in the Community Health Needs Assessment, mental health, and access to health care, both of which we are able to provide, as well as partnering with others for affordable housing. And it will help support the completion of the land swap and site improvements between Wake Med, the county, and Wake Three Partnership, all helping to establish the health and education district in Southeast Raleigh, which is important for economic stability. In 2025, fiscal year 2025, as Mary Nash referred to, Wake Med devoted 12.61% of net revenue from Wake County residents to indigent care. This exceeded the 4.8 required by 7.81%. I hope I did my math right, but I think I did. This is an investment we are proud of as it helps ensure medical services to vulnerable residents of Wake County, regardless of their ability to pay. and with atrium support we will expand our financial assistance policy from three hundred percent to four hundred percent of the poverty federal poverty level up to three hundred percent no bills from three hundred one to four hundred percent deeply discounted our board meetings will remain open to the public and the community directors appointed by you, the Wake County commissioners, will ensure compliance and be able to enforce Atrium's obligations under the definitive agreement. So now it is my pleasure to turn the mic over to Donald Ginseng, our CEO and president. And before I do, I want to recognize that there are several Wake Med employees and physicians in another room that we can't see, but I want to thank all of them for showing up.

I'm sorry, I have a board member question before we move on. And I was waving for you. I'm sorry. Yeah, yeah. We just, you know, the $2 billion has always, number has always been, you know, wondered how you came up with that. Because we see that five years ago, Wake Forest Baptist got a $3.4 billion investment, and you were offered a $5 billion investment by UNC. How did the board decide that $2 billion was the right number to do this consolidation?

That's a good question, and Dr. McDonald, would you like to address that? Dan, is that partly in your presentation as well?

Yeah, I'd like to.

It's going to be presented later.

I can wait. I think that's going to be presented in Mr. Blue's presentation. Thank you, Vicki.

Thank you all for being here and for all this great information you've shared today. My question is more back to Ms. Rusher and the mechanics of the board discussion. composition and i do know that we landed on eight members being appointed by us and six atrium if we end up approving the documents but there was something in the last documents that i saw about the atrium folks being able to remove our appointees and so i'd like to understand what type of situation would allow that to happen and You know, because we would like, if that's going to happen, we'd like to be informed. If we have a board member who's not measuring up for some reason, just like I would expect Donald Ginzik would do today, let us know, and then we can find a replacement. But I was a little uncomfortable with how it was worded that they could just decide to replace some of our board members. So if you can clarify that, I'd appreciate it.

Yes, ma'am, the proposed provisions of the articles only allow Atrium as the member of the corporation to remove a board member for cause. And then there's a pretty long list of a definition for cause. Should that happen, however, of course, the county is who would appoint the replacement board member so the county would be able to appoint the replacement board member that was what i was hoping would be the case so i appreciate that clarity thank you

Commissioners, good afternoon. I'm Donald Ginsink, and I get to talk about one of the things that makes Wake Med incredibly special, and that's our people. We got wonderful facilities, we got pretty cool technology, but we have an incredible team. And every day, thousands of them drive by other hospitals, to come share their gifts and talents at Wake Med. Now we have wonderful health care in this community and I want to see that continue. I want us to compete as a great place to work and to give our incredible providers, our incredible teammates, our incredible family more of an opportunity to share their gifts in what really is as high a calling as there is, and that's helping improve health and relieve suffering in this community. This is about adding more jobs, and over the next five years in a rapidly growing community, we'll add over 3,000 jobs. We'll also be able to get that talent from within Wake County. We'll be able to get that talent in Southeast Raleigh and create opportunities for more and more. People are moving here every single day. We've always attracted top talent. And the biggest part of that is our culture. Our culture and our mission. Who we're about. and how we get better along those lines and hopefully got a chance to hear from atrium why we fell in love and why we want to be part of that family because it's a very similar way they treat their teammates and so uh... will work to create an integrated health system that focuses on key foundational elements again growing from within eighty percent of our positions are filled from somebody within our organization More and more people join us every day and every year and grow and add new talent and get an education at Wake Tech and get an education at Johnson Community College and get an education at Duke and UNC and North Carolina Central and 50 other health care education institutions. So we want to help that grow. This is about adding jobs. It's not about laying people off. And so it's about creating more opportunities for those that are with our organization now and hopefully many more to come in the future. As you heard, there's opportunities for those that want to stay within our organization, but there's also opportunities for those that want to expand. And one of the things that was the most impressive was the number of folks who started with an organization that joined Carolinas and Atrium 30, 40 years ago that have worked their way in various aspects. And as you heard from Dr. High, how many folks within the Wake Forest Baptist organization had a chance to assume new roles. They look for talent and opportunity and for those that wanna grow and fulfill those. So there'll be more opportunities to learn, develop and explore new career paths as we add more and more new services that this community needs. An opportunity for folks to be involved in that as well as gain new skills, Again, they know how to take care of family and they're a family that we want to be a part of. So employees' years of service will be honored, pay and benefits will be harmonized along those lines to create more opportunity. And I'll be honest, I haven't gone through every single one point by point, but mostly they're better. Mostly they're better. And expand medical education. So it's not just about replacing. We have a wonderful, longstanding relationship with a lot of great institutions in our community. UNC, Duke, Campbell. And again, we benefit from that. They benefit from it because they get a great education at a great organization and they're able to take that talent and serve, in many cases, North Carolina. But we benefit from it because they come and are amazingly talented and fall in love with Wake Med and stay here 20, 30 years. And there are many that do that. So it isn't about replacing them, it's how do we add to that? So there's opportunities to offer more fellowships and oncology training and neuroscience training and so many new services that we're going to be able to bring to one of the fastest growing communities in the country. we have the opportunity and Wake Forest has the ability or other organizations do, we'll be able to add that even more. And Jean mentioned Magnet with as a site for nurses. I think there's only 700 in the world that are magnet designation. There's only three hospitals that are magnet with distinction. Wake Med's the only system. there is a atrium hospital that's with distinction and that's the highest rating you can get and i think there's one other one on the on the east coast but it's how do we get and how do we get better right magnet and magnet with distinction is not handed out easy you earn it through shared governance you earn it through best practices you earn it to creating an environment through which nurses can accelerate and expand what they do and one of the things i know our nurses actively are looking forward to is sharing all the wonderful things we do they kind of do it now and along those same lines learning what can make their lives better and their patients' lives better and their ability to deliver care better going forward. Care for the patient and family is the primary focus, right? Top of the pyramid, we use that term, right? How does this help the top of the pyramid? And you don't see me up there. You don't see the board of directors up there. You don't see doctors and nurses up there. You see our patient. And that really is about how do we get better. We're not the same organization we were a year ago. Hopefully we're better. We're not the same that we were five years ago. Hopefully we're a lot better. And going forward, how do we get better together? And so we want to share best practices and initiatives that create not only a better environment for our incredible community, care providers to improve care but also that patient experience for those that have had to navigate it it's very complex and it is very difficult and so how do we create a more patient centered focused experience to be able to get the care at the right place at the right time at an affordable rate and we use a lot of data we we are one of the best places that team members like to practice as well as uh... patients like to get care and we want to also figure out how we can get that care better at the bedside whether it's through technology or practices or resources and that's the struggle that dr high talked about when you're trying to decide do we fix a chiller that keeps the ORs cool, or do we add a new magnetic resonance imaging, or do we make sure that the sixty five-year-old pipes that need to be replaced get replaced much as the way the county has to make those decisions and right now it's a very challenging capital committee that tries to decide what we need and this will help us really be able to meet our significant capital needs going forward. And so real quick, how do we decide on $2 billion? We did our strategic plan. It looked at around $1.5 billion we'd need to redo the Raleigh campus and build the North Tower and add what we needed in Cary and the health plexus. got a little more and we also you heard from folks that we had outside advisors come in and so those advisors came in and said not only is this investment fair it's above fair from what they're saying could you sell us for more probably if all you care about is selling us then you probably could but whoever comes in here is not gonna have that same commitment, is not going to, they're gonna have to get that investment out. And so real quick on UNC, you know, again, we want more competition in the community, number one. Number two, that care for all piece is critical for us. Number three is They told me they're gonna invest five billion anyway, so here's your chance to get five billion and two on top of that in this community. We wanna make sure that we compete. I haven't heard anyone say we want less competition in this community. We are the most competitive healthcare market in North Carolina. And I wanna compete and am proud to compete for great care for our patients, great place to work, and the best patient experience along those lines. And we also partner, right? We partner with Duke, we partner with UNC, we partner with a lot of folks to improve care. And so it really is about how we invest in what we need going forward without having to sell, without having to give up total control. Because if somebody buys you, they own you. We don't need to be owned, right? We need to be what we are in terms of improving care in this community. So we're both epic organizations. which is our electronic health record again add more technology there so many opportunities to increase technology technology and innovation uh... we try to be a pretty innovative organization but uh... the opportunity to have the resources that our providers and our physicians need in this community through technology and access is incredible. Their virtual platform, they started 15 years ago when there was no money in it. There's probably still not money in it, but it was the right thing to do. And they have one of the best virtual care platforms, which is increased access at a much lower cost for a lot of care that can be delivered. And I'm excited about bringing that here, especially, I love what they're doing in schools, right? Because if you can help the child with their health, if you can help the family with their health, people don't have to leave work, children don't have to miss school. And the capital improvements, will be critical for us, not just to build buildings, but to create access and better services, particularly, this is the most important thing to me, it's all wonderful, to help rebuild the New Bern Avenue campus. Because Southeast Raleigh's very, very special, and there aren't a lot of people running to add thousands of jobs in Southeast Raleigh and provide resources in Southeast Raleigh and redo a facility that is one of the busiest safety net providers in the country in Southeast Raleigh. And so that's the big key. And that was the big aha moment, right? We could probably get enough money to fund... the garner campus we could probably get a little bit at some point in the future to do north but we wouldn't be able to in my opinion to redo the raleigh campus for a long time into the future and that's what this community, particularly Southeast Raleigh, need along those lines. So it allows us to get medical technology. It allows us to get resources. It allows us to add jobs and to be one of the best and most innovative and state-of-the-art health systems out there. And so service preservation, right? That's where they're going to come in and close things. I hope you got a chance to hear from folks. If anything, they come in and open things and add more services and add more. We're in one of the fastest growing areas in the country. We need more services. So trauma centers, emergency care, primary care, children's care, maternity care, neonatal intensive care unit, mental health. But not just adding those services, adding it with a centerpiece around that care for all. And I can tell you, if you sell us, anyone that comes in here and has to pay to come in here is not going to have that same mindset because it's just not how they are going to get their return on their purchase price. So decisions are made locally. operations are best led by the ceo and my wonderful leadership team it'll be done at the local level community needs and collaboration with atrium health and service development decisions are driven by what's needed in the community community need planning insights and how we go drive we are the healthiest county in north carolina we don't have 30-year disparity But in Southeast Raleigh, if you're an African American male, you will live 10 years less than a non-African American male five miles away. And even though we're the healthiest county, we need to work actively to close disparity gaps across our community along those lines. So we work together on how we can best do that. And now I'm going to turn it over to Dan Ballou III as a board member who's been involved in this process and have him talk to you about our charity care. Thank you. You're welcome. Keep that. You're not happy to answer any questions. Now or after.

I do have a question. Sure. And this is yes or no, so it shouldn't take long. Are you under any legal obligation to not negotiate with any other offers that come forward?

We have what we call a signed agreement. Okay.

Yeah, so you couldn't negotiate with UNC?

Yeah, because it's not a negotiation, right? We look for a partner, and I mentioned the criteria was that charity care mission, that mission to care for all that culture. Was there a culture match? And so that's the difference between a sale and joining a family. Okay, thank you. You're welcome.

Thank you, Donald. Thank you, commissioners. I'm Dan Blue III. You had another question? My apologies.

Yeah, just a real quick. Thank you, Jeremiah. Just a quick question. From the wait-mid, what we gain, what we lose, the plus and minus side, I just wondered, where do you see setting the cost of care? what side do you see that falling on? Do you maintain that? Because I know there is a lot of speculation and one of the big concerns that we hear from community is increasing the cost of those who actually have to pay, who don't qualify for the charity care and have to pay out of pocket. Where do you see Wake Med setting the cost for care on that gain, lose, where does that fall?

Well, as was talked about, our costs are going up every day. And 70%, 60% to 70% of what we get paid is fixed. It's a government. And if I were to call Dr. Oz tomorrow and say, you know, we're the Medicare provider here. We want more money. We're not going to get it because it's just how the payment rate works. So that's fixed. For us, it really is our costs are going up every day is how do we leverage that scale for good to help lower what we're able to spend for equipment and pharmaceuticals and services and be able to deliver care in a virtual care setting instead of having to build more fixed settings along those lines. And what we sit down and try to do is make sure we're paid fairly for that by very large insurance companies that control that 30% difference along those lines. And so we've gone years and years without increases from some of the insurers in this community and premiums still went up. So I find it a little, I'm a little skeptical that Wake Med joining Atrium is going to add hundreds of dollars to everyone's bill because their bills went up from insurance companies when wake med got absolutely zero increase for three four five six years along those lines so i can't tell you um what i'd rather do is let's figure out how to bring others down instead of keeping wake med 20 to 30 to 40 below everyone else you really want to impact health care costs uh call on the others uh in this region to lower what what they do so that's really the challenge i i we're obviously our costs are going up every day we're trying to figure out how to get paid fairly along those lines and we are considerably less because we're little awake med than what others are paid for by payers

I don't know that that gives me clarity around my question. Maybe I'll frame it around something that is a little bit more simple to understand. For example, I know when you receive your bill and you have those itemized costs and um say um for an aspirin will wake med currently sets the price that one sees on their bill for an item as simple as that i will on that plus and minus column will you still set the cost for that or will you then move to atrium's cost for an aspirin that is a little bit we'll sit down and negotiate our own

along those lines with payers, but we help set the cost. Hopefully our aspirins will cost less because we'll be part of a $39 billion organization buying a boatload of aspirins out there, as opposed to, even though we're big, $2 billion, we're still not as big. Again, I could double our rates tomorrow and what we get paid would stay the same. So it really is about how we drive better health. That's the best thing, right? So we're gonna sit down as we do with every payer every couple of years when our contracts come up and try to get paid fairly, right? But we negotiate that and hopefully we'll negotiate a little better that'll help Wake Med be able to deliver more care to more in our community. They didn't answer it.

Commissioner Thomas.

Thank you, Chair Mayer. I was going to wait until we got to the affordability slide, because I would love to hear from Dan Blue III. But since Commissioner Waters brought it up, you were talking about negotiation. And one of the things that we've been hearing a lot is the negotiation of the state health plan. So we've been hearing that state health plan premiums are going to increase. exponentially for every person covered on the state health plan. And so I would like to hear from you, Mr. Gensig, and you, Mr. Woods, about whether that is true or not true, whether that is possible or not possible. You mentioned negotiation, and so I'm interested to hear if that also plays a role in that. Thank you.

Like the state, We have employees. We have our own employee health plan. And that costs more. To deliver care, the more people you get, we tend to focus on trying to keep them healthy, because I'm a firm believer in a healthy person costs less than a sick person. So I understand what the state employee's health plan is trying to do. They've got a cost challenge. It's easy to say the way you're going to control it is by lowering what you pay to the providers that the patients are getting their care from. I understand that challenge, but they need to make changes. Wake Med didn't drive the most recent changes that they're having to make. They're trying to deal with what they have to deal with along those lines. We would love to work with the state health plan on how we can really drive lower costs going forward through better health. And so, again, we'll be happy to sit down, but if If Wake Med joining Atrium adds hundreds of dollars to people's, then I'd be very surprised in that because they need to add, they're adding hundreds of dollars without Wake Med at this point because of the challenges that they have to face. I understand it, right? I have my own employees. They have their employees that they're trying to worry about, but it is easy to deflect and throw those that are delivering the care to the patients as the centerpiece of all costs in the state of North Carolina and the fiscal challenges they're facing.

I understand that. I had mentioned earlier that I think that it's the insurance companies that drive the cost versus the actual health system or even the facilities. And so, listening to your answer, you're saying that there is an opportunity for it not to exponentially increase for every single person on the state health plan?

That would be my ultimate desire to sit down and let's figure out how we can do more. Can we focus on health? Can we do some at-risk changes to really incentivize the state employees and retirees to live a healthier life? Right now they're doing some things with Medicaid Advantage or Medicare Advantage and those sorts of things. but they don't focus as much on how you prevent, how you focus on how you get their A1C in line, how you do all of the things that ultimately lead to better health, which leads to lower cost, not to mention a happier person who doesn't have to face illness, injury, and disease.

Thank you. Mr. Woods, could you answer the same question?

I would just add to the comments. I mean, it's a big challenge. Affordability is a real issue in this country. And so I think we will be respectful. And I think state health plans and all patients are looking for ways to make sure that they have, you know, they're trying to juggle between health premiums and grocery bills and things of that nature. And so we respect that the state health plan is trying to do what is best for the teammates or employees. I know that there was an increase that was just announced, I think on Friday, that was trying to absorb the cost of inflation and things of that nature. That certainly happened before this deal, so this did not influence that at all. But right now, we're one of the leaders in the country what's called accountable care organizations. So the government has named Atrium as one of the leading organizations in the country to both reduce costs for Medicare and also improve quality. And they're called value-based arrangements. So we would welcome the opportunity. In fact, under previous administration at this one, we did propose to enter into value-based agreements, which essentially means how do we take some of those dollars and sort of, I mentioned, close care gaps. So how do we do preventative care so that hypertension doesn't become a stroke? How do we get incentivized for providing high quality of care? So we would welcome the opportunity going forward to really, the model is not great and so how do we change the model to really deal with the really chronic conditions as well? So that's, we would welcome that opportunity to have those conversations. I don't know the math that was used in terms of anything that says the prices are going up. That's certainly not, again, related to us specifically. And we're on record with providing a proposal for, this was back in 2019, for how do we do a different way of working together to lower costs and increase quality.

Thank you, that's helpful. And when you say the model, you mean the model that the state healthcare plan is currently?

Yeah, I mean, I think the challenges are pretty ubiquitous in terms of the cost of supplies going up and trying to afford that and the price of structure. We think that it should be, there's an opportunity to do a value-based, sort of similar how we work where you're incentivizing for quality and other things like that. So we'd be welcome to having a conversation about that.

Thank you so much, very helpful.

Commissioner Stallings and then we'll go ahead and then give Dan go ahead opportunity to finish up.

Thank you, Chair Miles. So this is piggybacking what Commissioner Waters and Thomas were asking. So from a lot of people I've heard, there are assumptions that there will be rate increases associated with this strategic combination. And there are assumptions that any negotiations that you all do with insurers will create more costs and that those costs will be passed down to employers and their employees. the form of higher health insurance premiums and so those are assumptions so I'd like you to speak to that assumption and then a follow-up to that would be is would you commit to a cap on reimbursement increases for the next five or ten years there's as I mentioned our costs are going up every day and

What we get paid by the federal government, Medicaid, and virtually every insurer has not kept pace with what our costs are going up. So we have a couple choices. As you heard, we figure out how to get better and get a little more efficient, or we curtail services. or we figure out new revenue streams to do it, but in most cases, those are challenges. So when we sit down with insurers and payers to negotiate, we have that discussion with them. This is what our costs are, this is how much below everyone else we're paid, right? If we were all paid the same thing, we wouldn't have to worry about it. But we're not. And as is easily findable somewhere in the insurer's company's payment rates, Wake Med has paid considerably less, anywhere between 10, 30, even more percent. So meanwhile, insurance companies, again, they're not all evil. They serve a wonderful purpose, has made billions of dollars. billions and billions. And so it's really how do we create a collaboration that ultimately, because again, Jean mentioned that it's how you keep people healthy. How have we been innovative in working with Blue Cross and Aetna and United on helping keep people healthy. So right now, our challenges are getting paid fairly. fairs of relative term but clearly trying to at least get paid closer to what the market is in this area where we're by far the lowest and so you know for us it really is about how do we invest more in the community and less about how do we fix rates because that very little of that falls to the patient anyway along those lines so uh... you know we affordability is as gene mentioned is a relative term but it's how do we do all of that together while improving health while creating more access and more care along those lines and it really isn't tied directly to rates because communities with the highest disparity of rates between one provider and the other doesn't necessarily translate into best care in those regards.

Maybe sharing a little bit of what Donald said. The price increase that you all would have gotten from insurance companies, let's say over the last five years, are two to three times more than what we get reimbursed for providing the care. And so the cost of care is, in some respects, disconnected from the premiums that are paid. But as I said earlier, I would be, we'd be willing to sit down and look at a different construct, preventative care focused on quality care, outcomes, reducing unnecessary care. So changing the model, I think, is really what we would be very open to exploring.

So why is weight med paid so much lower?

That's a question you'll have to, the folks who live in this community, I know there's a lot of questions about atrium coming in and the questions about prices. I don't know, Commissioner, if you've asked that question in terms of the other competitors here and understanding why that differential is so great. It's been a surprise to us when Donald has shared that because we believe that Wake Med provides care equal in terms of quality to the other health systems in the county. So that's a question that was a surprise to us when we came here to find out, to learn based on publicly, I'm sure we can't talk about that specifically, but based on publicly available data, that the other competitors are paid significantly more than Wake for what we can see is quality that's equal and sometimes better.

So it sounds like, well I think part of what I'm trying to figure out is in terms of your revenue streams, like where do you get the funding to do all that you have done for charity care, for all the community work that you've done to address all these social determinants of health, which I applaud and think are wonderful, but the money's gotta come somewhere. So where does that revenue come from? And you said 30%, I'm assuming of your revenue is coming from private insurance, yes? So is part of it a volume? I'm just trying to understand that.

Yeah, that's real, it's complicated. As I alluded to earlier, part of the value that we have to scale, the $1.5 billion, and that was actually last year. We basically, that's our way how to mitigate the expenses that we experience in the double digit increases in supplies and in pharmaceuticals. And one of the decisions that we made early as a system, I'll just give you a little bit of the inside baseball. We had a lot of different electronic medical records and different instances. We quickly put them under one. And so we have Epic here. So that saves a lot of money. efficiencies rather than having to try to manage a lot of different systems. We had a lot of different systems that manage supplies and finances. So we standardized our system and saved hundreds of millions of dollars on that. So the great thing is because we have a platform, Wake Med won't have to make the same investments. It's really just a variable cost. It's not a fixed cost. So how we were able to do it is really standardizing our systems and try to get from all our 70 hospitals and our 1,000 care sites. And that's really how we've created some additional capability to both absorb the inflationary pressures that we all have experienced. But the one thing... my board, so I have a board as well, have said is a non-negotiable, and it's a non-negotiable for this board too, is we've got to be there for vulnerable communities. And a lot of times when you don't have the dollars to be able to do that, what happens? When you don't, The challenge are people, you see layoffs around the country. You see reductions in community service. And we've done the opposite because of how we've run. Since Advocate Health has come together, we've added 20,000 new jobs. People were concerned that we were going to, so we've not done it on the backs of employees. We've actually added 20,000 jobs and we're the leading system in the country in community benefit. So because we run a very efficient shop, because we're focused on efficiencies, because we're focused on leveraging our buying power with suppliers and new technology to create the ability to invest in communities. So those are some of the reasons why I think we've been able to maintain and make the right investments.

Okay, Dan. All right. Thank you, and thank you for your questions. I'm Dan Blue III. I am also an appointee. You all appointed me in 2015, and I have served on the board since then. I have served as the chair of the finance committee. I am currently a member of the executive committee, and I chair our joint committee on quality at the hospital. I want to talk about a couple of things that are important to us, things that we have been committed to protecting and preserve of course it starts with charity here not only because it's the right thing for us to do but it is written in our d n a that we have to do that so so one of the questions uh... when i that i hear when i hear your questions commissioner stallings is how is it that we made is able to put so much in a charity here get paid less than some of its competitors and still be profitable. We are a well functioning hospital. We've worked very hard to get to that status. And we've done that because our agreement with the county commissioners has always been that we have to set aside a portion of our money for charity care. If we don't do that, we no longer have our hospital. It reverts back. It's that simple. So we have been very disciplined in making sure that where we can get efficiencies without laying people off, without sacrificing the quality of our care, we take those opportunities. This is at the core of who we are. But we also have this partnership with the county that I've mentioned before. We like to be your partner in solving your problems. If it is healthcare adjacent, we want to be there to help you navigate it. When we look at the community health assessment, the needs assessment, it's fascinating because you see things come up that are peripheral in many cases to healthcare. It becomes things about affordable housing and transportation was on the list three years ago. It's not on the list anymore. So when we found Atrium and we saw an entity like us that had an upbringing like ours that was investing in some of those other areas to provide solutions and affordable housing because it understood the impact on community health, we said those are our folks. That's our culture. That's what we believe in. Now we've gone through those numbers. But here they are in dollar figures. This is the community benefit. The first two that you see are unreimbursed costs. But we've also invested in health professions education, community education and health improvement, outreach and contributions. We've got an uncollectible debt expense where we simply allow those to continue and don't seek enforcement. So that total benefit in 2025 was just shy of $400 million. That's the impact that Wake Med has, and that's important to us. That's what we want to preserve. Which gets us to affordability. We are and will remain committed to providing value to the patients that we serve. To do that, we're looking at expansion of financial assistance policies. Again, you've seen some of the increases, for example, going from 300% of the federal poverty level to 400%. But as we've discussed, consumers experience their health care costs primarily through the cost of insurance, not from the providers. That's simply the way this system is. We try to get around it in some ways, but our reimbursement hasn't kept pace, which is what Donald and what Jean has just gone through to describe. So we've got five strategies that we found from the American Hospital Association report about making health care more affordable. And again, you'll hear some of our initiatives in this area. around improving the health of all individuals and communities. And that is trying to get in front of the problem instead of just treating the problem. Transforming care delivery by better care coordination, reducing administrative waste, lowering drug and device costs, and innovating to improve care. So the one thing that we are very, very good at, is focusing on partnerships, because we can't do any of this alone. And Wake Med is usually in the center of the network, sort of leading charge, saying, what can we do? How can we make this better? And I think what you also heard in our CEOs sort of speaking about this is to say that we want to sit down and help insurers and populations figure out how to solve the problems, because the problems aren't always just put more money here. Sometimes it's making sure that you have networks in place, for example, for mental health. It's making sure that people who are ready for discharge from a hospital have somewhere to go. Those are not hospital problems. Those are health care problems in communities. But we have to be able to help and assist that because we've got a better view and better resources to do that. That remains important to us. And then health equity in underserved communities. And again, because we once operated as an extension of the county, we are always very concerned in making sure that everyone in our community, everyone in our county has access to affordable health care. Even if that means we go out with street medicine to try to make sure that we're reaching people where they need to be reached. Because it should disturb all of us that there's such inequalities between zip codes and life expectancy. And we need to do something about that. So that gets us to our market situation. And this is sort of the, what are we talking about here? And we start with a view of North Carolina's hospital systems in 2011. And we would normally call this the brown dot chart because that's where Wake Med is. It's a brown dot. And since everything's sort of earth-toned here, we're okay with that. But as you see, we're there hovering around $2 billion, along with Wake Forest Baptist. You see New Hanover over there. You see Novant up there as well. Last two years ago, in 2024, we got an update to this. And you see the big ones have gotten very, very big. Atrium's gotten large. Navant's gotten large. UNC and Duke are sort of in there in the middle. They've also got endowments to help them survive. UNC has the state to make sure that it survives. Wake Med doesn't. Independent health systems like Wake Med will find it difficult, and they will struggle to survive in this climate. So we looked for a partner. We're able to do that because we're operating from a very strong financial position today. Like I said, we're lean, we're effective, and we're profitable. But going forward, to do the things that we want to do, to continue to invest in our community, to open health plexes, to rebuild in many ways this Raleigh campus, and to continue to expand across the county, we're gonna have to invest a tremendous amount of money. As Donald said, we sort of had a wish list, a list of projects that we wanted to fund over the next 10 years. And we quickly realized that our revenues, our income, don't meet that level. And our ability to borrow from the markets doesn't meet that. And instead, what we would have to do is prioritize and spread things out well past that 10-year horizon, which means that the Raleigh campus, for example, wouldn't get the improvements that it needs in order to stay consistent with the rest of our operations. We'll build out Garner. We'll put in a tower at Raleigh North. But everything else has to wait. The community that we serve can't wait. The other headwinds that we face with this is that there's a lot of uncertainty around Medicaid and Medicaid-related programs. Participation in the Affordable Care Act, for example, is down 17% in Wake County because of policy changes. We are very much at the whim of a legislature and Congress and everybody else who's driving some of these reimbursement rates and some of these insurance premiums. But we've been able to do it in a very competitive market. Okay, we have competitors because we are the most competitive market there is in North Carolina. We've got three hospital systems competing. And if there's a hospital system that wants to make an investment in Wake County, by all means, we would love it. Hopefully they will do it with or without us because this community needs that healthcare. We can do so much more in partnership. And we can do so much better if we simply focus on what we do well. This transaction helps us to do more and better. And with that, I'm going to turn it over to you, Thad, to carry out some of the last things. Are there any questions? Again, if not, we're happy to answer questions at the end as well. Yes, ma'am.

Yeah, I'm not sure if this is the right place to ask it. I was waiting for the affordability slide. We've heard a lot today about margins and what folks make, I mean the margins for healthcare companies. So what is Wake Med's current margin and what is Atrium's margin?

Our operating margin is essentially four cents on the dollar. So after we take care of paying our teammates, which is probably about 60% of our expenses and our debt and supplies and medicine, we have four cents to reinvest in the community.

Okay, okay. Ours this year is around four cents on the dollar. That's better than two years ago where we lost 2.6 cents on the dollar. It averages to about 2%.

Okay, thank you. The other question, as soon as this was made public, I got several emails. I grew up in the Charlotte area. I got several emails from folks in the Charlotte area with the news coverage about the large increase you got in pay. And that seems to be a huge rub there. Could you talk about, you know, how that affects the bottom line that you're the highest paid, apparently, CEO in all of Mecklenburg County, according to the Charlotte Observer?

don't always believe what you read all the time, Commissioner.

That's why I'm asking because you don't always believe what you read.

I certainly don't. I have a board that sets my pay obviously using independent advisors and based on the complexity and size of the organization. So I don't control that. What I do control is what we invest in our teammates, right? So I've mentioned the $18.85 minimum wage that we just raised. Last year for Advocate, actually we invested $700 million in increasing pay and pay adjustments for the 170,000 teammates that we serve. So the things that I do control are those and how we help teammates and that's what I'm proud of.

Any, yeah, Commissioner Thomas.

While we're talking a little bit about affordability, I'm just thinking about when we talk about cost of care and fee-for-service, could you help me understand a little bit more about value-based care?

Jean. So, in 2015 president obama had put in place the affordable care act right it was passed by congress and that created an opportunity for relationships with medicare and others around how you drive better quality at a lower cost and if you're able to do that that's value-based So you're incentivized not just to the traditional fee for service, take care of somebody for this, you get paid for that. It's how do you really focus on improving the patient's health, improving quality outcomes along those lines. And for that, you have the opportunity to share and get payments from the federal government to incentivize better care at savings. Along those lines because a lot of obviously a sick person costs more than a healthy person and so we in 2015 Did Medicare shared savings programs? We have a lot of value-based programs with Blue Cross and and United and Aetna and other payers in this community as well. And so that's really been our, we have Wake Key Community Care, which is an accountable care organization with a group of community primary care physicians. And we've created that partnership that's had generated a lot of shared savings, but also a lot of better health and money to reinvest back into the community. just a different payment model but it's one that ultimately I think will get us to what we need to get to because right now we have a sick care system versus a health care system.

Could you tell me how HRM does that similarly?

Yeah, I alluded to it earlier. We were recognized by Medicare and Medicaid as being one of the leads in the country for that. So if you go back about a decade, our legacy organizations, by the government's own admission, we've saved the government a billion dollars in the cost of care. through the similar things that Donald mentioned, preventative care, really focused on high quality. There's another thing called readmissions. So when you're discharging patients, making sure that you have the community services so they don't come back in the hospital. So we're happy to provide more information, but we're recognized as one of the leaders in terms of value-based care. And that's really, it's a different model of providing care, and I think it's a model that we believe can be expanded. Yeah.

Thank you, Bill. All right, Commissioner Stallings.

So a couple questions following up again about the the work you're doing in the community potentially with charity based care. With the Wake Forest combination this question has to do with disparities in health care and how you've maybe tracked those since your partnership because I sit on the Health and Human Services Board for our county and our staff is doing a great job always of tracking health outcomes but we clearly have racial disparities in many outcomes including you know, maternal and child health for example, but in other areas too. So can you speak to disparities and have you seen any improvements in that area after your partnership?

So there's a number of ways that disparities are measured and outcomes are influenced by a lot of different things, as you might imagine. But what I do know is that we have been able to close a lot of the care gaps that Gene talked about. In those value-based contracts, you actually get reports from whoever you are being paid for quality and cost. And we've been able to close a lot of those care gaps in breast cancer screening, lung cancer screening, high blood pressure, diabetes, those sorts of things. So those are the places that we have seen closure. And we've seen actually more closure, I believe, underserved populations than we have in, not over-served populations, but payers, better payer mix populations. I think I'm quoting those correctly. I'm a little bit out of date on that, but is that right, Gene?

Yeah, now he's a physician scientist. He's not in the administration. That's right. Every year we do an analysis of disparities and gaps in whether the rural care and urban care. A few years ago, actually, I was mentioning Medicare and Medicaid. We were recognized as one of the leading organizations in the country for decreasing disparities in actually colorectal screening in cancer in Hispanic males. We were recognized by the government as one of the closing the gap. So that's part of our work. Every year we just do an analysis. The 230,000 care gaps is part of that, because it's really focused in vulnerable communities. You mentioned maternal health, which is a really big challenge in community. And we have We're very big believers in doulas and having them go into the communities of need and really as much as anything, have an advocate. I mentioned we have 60,000 babies that will be born and mothers in vulnerable communities need an advocate, need somebody to kind of work them through the journey. We also have mobile vans that go into communities for prenatal screening, prenatal care. So a lot of it is our interventions are focused on really closing the gaps that we see when we do the annual assessments. And I mentioned before, we have a whole department really that's devoted to just this very issue. but it extends to the other things we've talked about, food insecurity. When you have gaps in food insecurity, that actually has downstream impact on health, and that's why we have interventions. Now, the challenge is some of these stats are long-term, so you don't really get the loop for five, 10 years, but we have enough assessment in terms of what are the corollaries of health to be able to focus those interventions. And we're seeing gap closures. Those 230,000 is an example, but there's other areas where we're seeing gap closures. And I mentioned Southside Chicago. I'm convinced here that we're talking here a couple years after the hospital opens, the care that we put in the churches will be closer, and that will be part of what will close the gap, hypertension, diabetes, and things of that nature. So we focus our interventions based on data that we have a whole team. I have a whole team that's looking at that on an annual basis.

And then just one other follow-up. It's my understanding that there have been some foundations or trusts that have been created in either partnerships or mergers or some relationships that you've had with other hospital entities. I'm thinking about with the Mission Health System, for example, in Western North Carolina. Can you speak to that in terms of... Could there be some type of foundation or trust independently governed possibly or not but that would be guaranteed through this partnership that would specifically address some of these social drivers like affordable housing or food insecurity or violence prevention or street medicine outreach?

I think the reasons I think was alluded to earlier, they're two different sort of, right, those were sales. And so the only way the community was assured that the things we do, just because it's our mission, is because they put them on a trust, right? So everything that I mentioned, and I would put what we do against any health system in the country in terms of violence prevention and things from here throughout. So they're two different things. completely different structures. That is a complete sale. When you have a sale, then that hospital could be sold again, right? So the community is saying, how do we get protected for the sale? And so we have a foundation. Part of the challenge in foundations just in general, and they do great work, is, I guess the way I would describe it, it's the difference between having a scholarship, which is important, and actually building the classroom. This is about really having dollars to build the classroom, which in this case are the hospitals that are needed and the outpatient centers that are needed. And we already start from a really good place in terms of Wake Med does service to community. And so completed different constructs and I think we have built in protections also in the definitive agreement as has been shared in terms of our ability not just to meet the current charity care levels, which includes some of the things you mentioned, but to exceed it.

I think I would just like some more clarity on that, and we can talk maybe offline about some guarantees that our community could get, and investing in those social determinants of health would be very important to me.

Thank you. One last question, then we're going to go ahead and let them close out. Commissioner Waters had a question, and then we'll go ahead and let them finish this slide presentation here, because we're getting close here.

Oh, thank you. Mr. Woods, you had mentioned being surprised to see that Wake Med was receiving lower payment for comparable services to other healthcare systems in the region. Is that correct?

I'm sorry, I was surprised to hear that when Donald shared in this, in Wake County, that, and again, we don't, There's a black box. We are not allowed to see any payment rates, have any exposure to any managed care rates that they do. So that's legal. There's a very, very tight firewall. But I was surprised to hear when Donald mentioned that in the publicly available data that they're getting paid less than some of the other health systems in Wake County.

And in that publicly available data, what does that say to you as an executive that you would do coming in to remedy that? What would be your course of action to remedy that? Does that look like increased healthcare? Are you okay with that happening? Because it sounds like... And I don't want to put words in your mouth like the quality of care is the same, but there's a huge gap based upon the data that you're able to see. But I just think about, you know, executives thinking about bottom line and revenue, which in this conversation has seemingly not felt as big of a problem. part of the decision-making process. It's seemingly been more about charity care and about serving the most vulnerable. And that is why I serve in the seat for those very communities. But then there's a part of me that also realizes that cost is a factor to be able to continue this care. So I just wonder what that communicates to you when you see that Wake Med is doing comparable work to whether it's Duke or UNC, but not receiving the payment. I just need to understand how you see that. How we see that.

Well, the first thing that comes to mind is that's why we really want to come together with Wake Med. Somehow they have figured out to do it with 20% less and still compete on quality and also being able to drive the efficiencies to have a bottom line to continue to serve this community. So what comes to mind and part of the reason for why this conversation is, I think that we'll be able through our purchasing power to reduce significant costs of supplies and aspirins and all the other things and allow them to do more work. And they're known in this community for being in community. And so that's the first thing that comes to mind. I think we could bring some pretty, not only capital investments that will help them continue to extend their mission, but also I think we can reduce their costs that they receive from supplies. It's hard to do as a smaller organization, because you have different conversations with new technology suppliers for pharmaceuticals and so forth. So that's the first thing that comes to mind. I think we can provide some fairly quick relief in terms of how to help them absorb some of the significant cost increases that they've received for providing care.

Thank you.

Okay, let's keep moving. Now, Dan, did you have anything? Nope, I'm passing it over to Thad. Oh, awesome. Thank you.

Thank you. I promise we will conclude briefly. Let's talk briefly about competition and collaboration. My thumb doesn't work. I really feel strongly that a stronger three system competitive market will give people greater health care choices and further establish us as the state's premier health care region. And central to this is collaboration. We've talked several times today about Duke and UNC, but they're both fine organizations and I'll be honest with you, I've been fortunate to study at both organizations. I feel like my true education started with my divinity degree at Duke University and being able to study medicine at UNC formed the foundation of my entire career. So I cannot say anything bad about either institution and I hope that we will continue to work with them well into the future. But as you know, on May the 6th, one day after we announced our proposed strategic combination with Atrium, we received an offer from UNC that several of you have mentioned today. We've had a wonderful graduate medical education partnership with them for over 60 years. I hope this will continue for another 60 years. However, we believe a combination with UNC would decrease competition in this market if i'm not correct i think if we partner with them they would have eighty percent of the market and in their proposal there really was yes they uh... had a larger offer but there was a lack of detail on the investment of this additional two point five billion dollars especially in southeast raleigh where it's needed the most choice for patients and choice for employees would be restricted so we respectfully thank them and let them know that we had a signed agreement We had worked on this agreement for more than three years and the terms of which prevented us from having conversations with anyone else. So next slide. So questions have been asked also about conflicts of interest and compensation. These are really good, important questions. All board members, management staff, physicians, and APPs complete and sign a conflict of interest statement annually. And I can tell you that all board members are volunteers. Is that right, Mary Nash and Dan? We volunteer our time, but we love volunteering our time. The CEO compensation is determined by the board, the local board, and it's reviewed annually. It's based on experience, scope of responsibility, training, and most importantly, it's aligned with the quality and strategic metrics of our system. Physicians are under a different compensation model which is multifaceted based on productivity, patient experience, community involvement, and more. But I can say that compensation in all levels is market competitive and this is necessary to recruit and retain the top talent i began by telling you that we are a mission driven organization i want to end by the same as i look at this window here someone boldly has written on that building forgive now i don't know who that message was for there are a lot of organizations around here But I can tell you that I hope the next time they shinny up there, they write just under that, care. Donald likes to talk about a Wake Med Mount Rushmore. And I can tell you, he'll be the first one up there because it was his idea. But Margaret mentioned a physician, Dr. Klossner, many of you all know. He'll be the next person up there. He wrote this book. How many have this book? It's a wonderful book talking about homelessness and the tools to hopefully defeat homelessness. But in here, he talks about his grandfather. And his grandfather taught him that a career in medicine is not a job. It's a vocation. It's a calling. And I'll just end today by saying our mission is a calling. It's a calling to care. It's a calling worth preserving. And we feel like Atrium Health is the best way to help us do that. Thank you.

okay thank you what an awesome presentation today i know we got a couple of follow-up questions so i'm going to start with commission um let me change that commissioner addison i know she's been holding her hand up for quite some time yeah but we just flip a coin

It's all good. This is one question.

This is an orderly format. We'll go Commissioner Stallings, Commissioner Jackson, Commissioner Thomas, and then Commissioner Addison. Is that covered?

This is actually a question from a primary care physician. I would just like to pose this on this person's behalf. They are a private care physician in Wake County for many years. His concern is that primary care physicians will be sort of taken up by your system. And then he's concerned that independent practices will then be starved of volume. Total cost and then there's a concern that total cost of care will rise due to higher hospital-based prices and then patients lose choice as referrals are steered inside the system. And the question is about independent primary care physicians and the status of them with a potential partnership here. He goes on to say that independent care physicians are free to refer based on value and quality to design access around patient needs and to keep care in lower cost settings. And in his view, that protects both patients and payers. So there's concern about how an impact of a potential partnership would impact the primary or private care physicians in the area. Didn't know if you could speak to that.

Yeah, first of all, primary care physicians have a really tough job. So I understand the concerns. I mean, they're there for all kinds of needs. I mentioned earlier that we have both employed physicians and independent. So we are not a closed model. Sometimes you hear a closed model, which means you can only practice if you're employed. So we have primary care physicians that are independent and also... So it's their choice whether they would wanna join the system or not. Here's the thing we do know, there's a significant shortage of primary care physicians. So nationally on average, if you wanna see your primary care physician, it's gonna take you, 24, 25 days to actually go see your primary care physician because of the shortage. And the independent physician you mentioned is working night and day to try to figure out how to shorten that. So that's why we invest heavily in primary care. One of the ways we do this is we're one of the leaders in the country in terms of virtual primary care. We give patients a choice. Do you wanna see your primary care physician, but it might take 24, 25 days, because they're really busy, they're working hard, or would you like to see a primary care that we have virtually, and then if you call, we'll be able to zoom in with you that same day, and we will make sure your primary care physician has all the information so we really see uh two answers one is we have both uh employed and independent and physicians that want to stay independent have are welcome with us and second we're also augmenting tools to help physicians uh with the very uh challenging job they have is is they're overburdened and and it's part of the joy in medicine um award that I mentioned in terms of receiving gold, that wasn't just employees, that's also independent physicians to say we're the best place to practice and we would welcome that primary care physician also to participate in sort of that.

Okay, Commissioner Jackson. I know you got your hot sheet ready.

Okay. Donald, you mentioned earlier that on the $5 billion that UNC offered that there was a reference that we're going to get that anyway. Can you share a little bit more about that statement?

Only from my discussions is they had mentioned they were going to invest $5 billion in this project. Now, if you look specifically, it doesn't just mention Wake County. It talks about Wake County and surrounding that could include the triangle. So I suspect like Wake Med, they've got plans to expand and grow services, and they've asked for certificates of need to build new hospitals. They want to build a hospital in New Hanover. They want to build one in Asheville. They want to build a children's hospital along those lines, so I suspect they have a lot of, and again, we're one of the fastest growing areas, and Wake Med can't do everything for everyone in this community, even with Adrian. Duke needs to expand services in this community, and they are. UNC is going to expand services in this community, whether more primary care docs or services along those lines, because we're growing that fast. And so from that standpoint, it was something they're going to invest here, Duke's going to invest here, and Wake Med and Atrium hopefully will continue to invest here. I just am particularly excited about the opportunity to invest sooner than later in our Raleigh campus, our Southeast campus. Raleigh community along those lines. So investment's gonna be, this is where the people are. This is where the need is. And again, we are the most competitive market and a lot of people wanna come to this market. Not a lot of people wanna come to this market and run toward the uninsured. But we found a partner who not only wants to come to this market, but also support us and care for all in the community along those lines. So that's what I was referring to.

Okay, thank you. And then Dan Blue III, you mentioned that if we did not move in this direction that we would be forced to prioritize. Some things would have to be delayed out further than the immediate needs of our residents. But you did mention the Garner Hospital, which is... right down the street from my house, and I care a lot about seeing that behavioral health solution built there. You mentioned that that would still go on. Can you all just talk a little bit about what would happen with Garner if we did or didn't, the different options here?

So we work with rating agencies and look at debt capacity. Right, so Garner's gonna cost about 400 plus million dollars to build that whole health campus. Our current debt capacity is between 300 and 400 million dollars. Now, we got profitability again, so that helps. But we spent a lot of our treasure on caring for folks during the pandemic. We burned through a quarter of a billion dollars plus in cash to make sure that care was delivered at one of the most horrific times in our nation's history along those lines. So we have to rebuild that. Garner, we've got enough capacity. We probably would in a few years on top of that. I know some folks may have told you that we have the ability to borrow all the money that we need. I did my first nonprofit bond issue in 1987. I did my last one in 2022. I've done a lot of them and I know our ability and the beauty of this and nothing against borrowing money, we don't have to pay it back. We don't have to pay it back. We get to invest it because we've joined a family that believes in what we're doing and has the means to be able to help us. So I do think the Garner would happen without it. If we don't do it, we've got enough for Garner. My big and our board's big concern was when we laid out our master facilities plan, which talked about all that we wanted to do with Wake Three, Wake Tech, Health Education District, and particularly the Raleigh campus. And that would be about 900 to a billion dollars that we likely will not have the means unless somebody of great wealth decides to give it to us along those lines to do what we need to do for the Raleigh campus in particular. And the beauty is we get to start planning that today and not just have this wonderful plan that's on a shelf that someday somebody at some future time tries to look at.

Okay, I'm tracking with that.

And just to make sure it's clear, when I said reprioritize, that does not affect Garner. Garner's at the top of the list.

Yes. Yes, I appreciate you underscoring that. And what I hear is that the one of the benefits of this combination is that we wouldn't just prioritize Garner, but we would be able to benefit throughout the county, which is our collective interests, including the health education campus that holds a lot of promise. So. I mean, this all sounds really good and great. And there will be people that says there is something. I mean, you all know it's just too good to be good. Like there is something. As a way of addressing that question and addressing the folks that hold that thought, can you just share with us, particularly both hospital CEOs, if you could just share with us this trend that's happening in America around consolidations, mergers, sales, why smaller hospitals aren't able to make, this is like a market trend that's happening. And I'm particularly curious about what you can share with us briefly about those trends why they're happening um and given that almost i think from my research over a thousand mergers have happened combinations sales all the things um over the last decade um truly where have has they has it caused the greatest impact negative impact on communities and res and patients because I hear the good things, I'm very clear. I just wanna get like, what is this risk that's associated with what's happening in this market and the trend that's happening that's much greater than Wake Med and Atrium?

Yeah, I mean, I think the consolidation speaks to the health systems in this country under significant threat. I mean, when I said three to four cents of the dollar after paying all the bills, that's on the top end. Many hospitals in this country are struggling to get by. We mentioned a couple, one where your sister works at, Southside Chicago, but we also mentioned Hugh Chatham. which is a rural hospital that, but for, I mean, they were losing multi, multi millions of dollars. And they could have closed. And because we feel that we can do rural healthcare well and less expensively and at higher quality, we were willing to bring them into the system. I will say a lot of systems aren't willing to take that risk. So if consolidation means you're just going to go to the areas of high commercial, well-paying insurance, I think there's a question there that's legitimate. I think if you look at our track record and the hospitals that we've maintained open and invested, it's been the opposite story. And I absolutely get skepticism. I mean, if you read any sort of the Gallup polls and things of that nature, Americans have never been more skeptical of big institutions ever, right? Whether that's big hospital corporations or health systems or government and all of that. I think what we hopefully will be able to provide is don't judge us by what we say, judge us by what we have done. And that's why we asked Dr. Hai to come here, because he could have been here with a completely different story. And he didn't have to come, because he's no longer the administrator. We asked him, you were there in the trenches, would you be willing to come and share the story? In terms of consolidations, we can't speak to the others. What I can say unequivocally is every time we have come together with another organization, have the same aligned values in the community and culture, We have gotten better. It's not just that organization. I'm looking forward to this because I know we're going to get better. In fact, when we bring the rural systems, we get better. Why? Because they've learned to do things with hardly anything and they figure out how to have different innovations. So we're in this because we Every time we've brought in the system, we've gotten better. We've been able to provide care better to the other communities that we serve. And that's what we can speak to is our experience and our track record. We can't address the other larger trends that could be for other purposes.

You want me to comment? I mean, I can go to the history of how insurance companies consolidated over the last 20 years, right? Where now there's five. And they are, there's not as large as Atrium is. They pale in comparison to the five big companies. publicly traded insurance companies out there. So what I applaud Gina and his board and his organization for is trying to create an avenue through which non-profit hospitals, non- university-owned hospitals, non-faith-based hospitals, non-for-profit hospitals, non-insurance-owned health systems are able to create an avenue through which they can not only survive but thrive and improve care along those lines. And so when I first started back in the early 80s, there were multiple insurance companies We would negotiate with all of them and then pit one against the other and get, you're down to five now. And they're publicly traded. And again, they're not evil. But they have different motives on how they are organized. And they do have shareholders that they're trying to drive value to. And they've done very, very well in this country's health care delivery system. So I can understand the skepticism around consolidation because we lived it. We lived it. I understand consolidation because not every corporation that comes in and when banks consolidate, teams leave and locations close and those sorts of things. What we looked for is if we were going to become a part of an organization, one that didn't close. And I applaud UNC. They're coming and saving a bunch of community hospitals as well. And that's needed in a lot of communities. But We look for someone that came in and would be, how do we use our talent and gifts and insights and scale for good? to support our mission of caring for all. And that was our criteria. Culture match, number one. Care for all, number two. The ability to make us better, number three. Yes, the financial means to invest and the ability to make sure that we focused on our community was the fifth thing. And they ticked all of those. Better than anybody else. Nothing against our competition or anyone that could come in here. Nobody ticked all of those like Atrium did.

Okay, awesome. One last question about just timeline and next steps. I'd love to hear either from our county attorney and others. You know, we're having this conversation today that you mentioned earlier, Mayor Nash, about what you're asking us to amend. And I would love our county attorney to just reiterate that. We've been together for a long time. Just to reiterate that. and others after we answer your question what around the transfer agreement and the thank you articles of incorporation what would be the next step after that and welcome you to add anything that you would like to

Yes, the ask of the Commissioners is to consider amending the Articles of Incorporation. And the reason that that is required is because the Articles from when Wake Med was formed said that any amendment to the Articles that changed the way the Board of Directors was constituted had to be approved by this body. The second part is to amend the transfer agreement from 1997. And just for some background, that has been amended before. It didn't allow for something like this. But it has been amended before in 2008, I believe. But paragraph six, I think, of the original transfer agreement says that any change in the management structure of Wake Med must be approved by the Board of Commissioners. So that's really what brings us to this table today. I mean, that's the issue. So where we were procedurally is that the agenda item was postponed for at least until August 4th. And so we'll need to make a decision about how and when to revisit that at some point. And that would be our part of the process.

Awesome. And then so after we, you know, August 4th, what is the next step in the subsequent steps procedurally to if this were to move forward?

I'm happy to answer that. So the next step is that we'll have to file with the Federal Trade Commission under the Hart-Scott-Rodino Act for them to review to decide whether this combination would be considered anti-competitive. and it's a federal filing, it's a process, a lot of paper. I think best guess, if we don't have to be elevated to a second level review, and to be clear, I was a public finance lawyer, not an antitrust lawyer, only have been told these words but if we're a second level review that could add another three months to it but you know the best case would be that we get through that by the end of 2026 and at that point um the once the merger is per the transaction is permitted to proceed then the senior management teams of the two entities would really sit down and start talking through the steps towards the consolidation. Okay, thank you.

Okay, we got Commissioner Thomas and Commissioner Adamson, and it's now five minutes to six, so I'm hoping to go ahead and close this out after those two comments.

While I appreciate you.

I'm sorry, didn't have you. While I appreciate you, Chairman, I can tell time. I appreciate that.

But I appreciate you trying to button it up because, honestly, my capacity to absorb information and retain information for the day is at its limit. So I wanted to start by saying thank you. Thank you for taking the time. Thank you for answering all of the questions. We look forward to, I know Commissioner Adamson has asked for written information, so we look forward to that. I just have a couple of questions for different people. One for Mr. Woods, I would like to know, what do you know now that you wish you had known at the very beginning of your first major healthcare partnership?

Well, I've been doing this for 35 years, so I've learned a heck of a lot, and I'm still learning. I think you can never shortchange the listening process, or quite frankly, you can never shortchange conversations like this. A lot of times, because we see the value and how excited we are about it, and we can see it, and we live it every day, and we're like, well, let's just kind of get on with it. Early in my career, I was a lot more impatient about getting to it. I think now what I've learned is this requires, I mean, all of the community listening sessions that the team has done and that you all have participated, the four hours that we spent here answering questions, what you're hearing from your constituents, That's what I've learned is that's part of the process. And I would have probably early on in my career been more, I would say, frustrated with it. And now I'm thinking that this ultimately gives us an opportunity to really figure out what this is about, to ask the questions. And then once we hopefully get to the other side, we're all aligned with, hey, this is the right thing and we're moving forward together. So that's probably what I would say is I've learned to be patient about processes and make the time for listening, because people are all over the spectrum. And you really sometimes don't know about health systems or hospitals until you have to have an interaction with them. You're not always thinking about it. And so this is just part of the process is what I've learned.

Thank you. This question is actually for Mary Nash, Margaret, Thad, and Dan. So if you were sitting in my seat, and you kind of are, because you are our appointees, and you were responsible for protecting the public interest and maintaining community trust, just like we are, So tell me, because you've been having these conversations longer than we've been having this conversation, what was the hardest part of this decision for you? You all voted as a board unanimously. So what was the hardest part of the decision for you?

I'll go first. I think the hardest part for me was losing complete control over the hospital, over what we do Complete autonomy. But as I said in our what do we gain, what do we lose slide, it became evident that what we gain really outweighs that one major concern. And we liked the bragging rights of being a very successful independent hospital. That was hard to let go of. That's fair. Thank you.

Yeah, I'll just echo that. We had to get past that the most important thing was to remain independent. we sort of had this mindset that being independent was the ticket and some of it was watching some of the other mergers in the state sales that had not gone well and we just thought we're not, none of that's for us, we are who we are and we are true to who we are but we, after some soul searching and a lot of talking to each other, by ourselves, by the way, we were talking to each other without any staff present, just the board present, of realizing that our duty is not to be independent. Our duty is to figure out how this wonderful institution that we are so passionately committed to can continue into the future. So we had to let that go.

Yeah. Thank you. I agree with these two, especially for me. I first stepped into Wake Med as a third-year medical student, you know, in 1985 and was so impressed with what it meant for the community then. You know, the very first night I was on call in this hospital, in the hospital as a student, I could see that it didn't matter whether you were the governor or you were an inmate from federal prison, you were getting treated the same way. And so I committed to that for my entire career and to let go, you know, the control, it's hard. But what really helped us is we decided that we were gonna put our egos on the table and decide what was best for the community.

I appreciate that, thank you. Although I did ask what, was yours, not what helped us. But I get it.

Thank you. For me, it was a combination of a very large change and probably not being able to talk about it as openly just because of the nature of it and pulling more people in. My dad had some interesting thoughts he found out about it you know but the biggest one was i can't believe that i didn't know about this yeah you know it was like well you're on boards too and that's the way it works yeah my wife thought i was having an affair for about a year and a half that was a hard thing but but again we we have uh imagine i've been in those shoes that i i have appreciated uh the opportunity for the board and management to get out into the county and talk to people and describe it and have these conversations and to answer these questions because it means that we're finally able to talk about it. And you can see our excitement about it and we stay excited about it, but that's why it was a unanimous decision. We really felt this.

Thank you. I appreciate your thoughtfulness, your feedback, and your opinions. Again, I think that as, I will not speak for my colleagues, but as one commissioner making appointments to many of our boards and commissions, it's very important to me to make sure that we're making the right appointments and that the people are doing good work and that They enjoy the work that they're doing and that they are being good stewards of the responsibility that we have entrusted to be our voices there. And I think that you all have done that. So thank you so much for doing the work that you do on this. My last question, I guess it's kind of a last question. All of this happens and we talk again in five years, Mr. Ginzig, Mr. Woods, what would you hope that Wake County residents are saying about this decision that we've made? Donald.

The same thing when I talked to communities that joined Carolinas 30 years ago. The same thing that the communities and leaders within that organization that joined Atrium five years ago, and that is that we have made and seen the best decision for our community and our mission and our organization going forward and that we were brave enough when we didn't have to, to choose to do something that's gonna benefit people for a very long time in the future without having to, right? That's the biggest, and I tell you, that would be my biggest heartbreak is Wake Med having to do it in five or 10 years, because I, I can see that. I can see that. Three years? No. Five years? Probably not. Five to 10? Absolutely. As a 65-year-old facility continues to become a 75-year-old facility, and an 80-year-old facility, and people not being able to get the care that they need. So in five years? when our plans are moving forward to rebuild the Raleigh campus and add services and expand primary care and support community physicians and community resources, I'll get a great joy from that because it is about planting a tree that I'll never sit under the shade.

Thank you for that, Mr. Woods.

You know, these conversations when you come together, we have a saying, wear the same t-shirt, right? So we come in as two different organizations, like a family, and then we're, I'd like for the community to say it feels like it's not Atrium and Wakeman, it feels like one organization, and not only we can point to the buildings, As I mentioned earlier, we've mentioned some of the things that are important to you as commissioners is that they see us more in the churches, they see us in the YMCAs, they see that their brother, mother, father or sister that has a mental health condition now has greater access to care that they might not have otherwise had. We really hope that at five years, Wake Med is a phenomenal organization, is an even better version of who they were.

Thank you very much. I appreciate your honest answers. It's 6.04, Mr. Chairman, and I am finished.

Manager Ellis had a question. Then I'll come back to Commissioner Adamson. And water, yeah.

Now, go ahead. Donald, you brought up insurance companies, which led me to start thinking. Do you envision a strategic combination having a positive impact or a negative impact on your negotiations with insurance companies?

It'll have an impact. Where I came Why is Wake Med the lowest? Because we're the smallest, right? What I'm hopeful is that we'll be able to work out even more opportunities for all to be covered and get care at Wake Med and others in the community. We're in the most competitive market. You're in a two-hospital town, you've got to have one or both of them in there. Sorry. You're in a three-hospital, you can get by with just two, especially when the two are the state of North Carolina and an organization that's wonderful and nationally recognized and with more money than the state of North Carolina. So I'm hopeful that... I'm hopeful that we'll be able to provide even more care and help drive access and make healthcare more affordable and improve all kinds of things. And I'm hopeful that the insurance companies will want to have Wake Med as a part of what they make available to their beneficiaries.

Okay, so I think next then, Commissioner Adamson. It does make a difference. Y'all can decide, I don't mind.

Thank you, I'll try to make this as quick as possible. One of the concerns I've heard from providers is, you've talked a lot about efficiencies in purchasing goods. What percentage of that is your budget? So if you were to cut supplies and the things by 10%, it supplies half your budget, 5% of your budget, What a real savings is that? And what the providers I'm hearing from are concerned about, to save money, you're gonna change patient to staff ratios. So the nurses will have more patients, the doctors will have more patients. And if that's the case, how do you plan to preserve the care if each provider has more patients to deal with?

Question for me, yeah.

Whoever. I'll take it and then we'll hand it over to Jean or Dr. High who lives it. It's about giving more resources to our staff. Better technology. imaging, connectability, the right care at the right place, getting patients that don't need to be in the emergency room into an urgent care, getting patients that can be handled virtually through those aspects, walk-in primary care prevention in those aspects. The way you become a magnet hospital, is you don't do it on the backs of nurses. You don't cut people. You don't drive efficiency through adding more to provide. You try to make their jobs easy. Maybe they can see more patients because they're not having to spend as much time on the computer. Maybe they can see more patients because they have some support staff to be able to help deal with those and virtual care and better technology and better testing and those sorts of things. if somebody buys you, that tends to be how they're gonna do it. But they're an organization and we're an organization that tries to drive a better patient experience for the patient and a better care delivery experience for our nurses and our doctors and our technicians and those sorts of things.

Okay, so since you've been the Mr. Blue, you've been the finance chair. What cash reserves does Wake Med currently have and will Atrium have access to those cash reserves?

So I'm going to defer to the current finance chair.

Okay.

Who's over there.

We're gonna do that, Mr. Blue III. But honestly, I'm gonna defer to our CEO who can speak to this quicker than I can.

Sure. well what i can tell you is we have about a billion dollars okay so will that be used toward the two billion or is it truly two billion well part of what rating agencies ask you to do is not spend all your cash right right so you want to have reserves so when a pandemic comes or you need new things you've got certain cash reserves so that's uh first and foremost uh second We have access to atriums. They don't need our money, because we need it to invest here. So it's really what together we bring. And as fast as we're growing, It's gonna be a long time before monies from this community need to go someplace else. They're a very strong organization that has a purpose, a non-profit purpose, to invest in communities that benefit from them. So there's gonna be more coming here than in my lifetime will ever go out.

So Mr. Chair, I have one comment and two more questions and I'll go fast. My comment is I agree with Commissioner Stallings. I would be a lot more comfortable if some of these community benefit agreements were in writing in a forcible agreement. So we know we're going to get those. The other thing we haven't talked about is parking. I know I've had, I mean, it's a thing. I have had relatives and know people who've had relatives long-term in care facilities. And I mean, my husband's spent three weeks in Duke University Hospital and 15 or $20 a day adds up when you're trying to buy meals out. So are you planning to monetize the parking decks or leave them free?

When I got here, we monetized the parking decks. And that was one of the first Donald decisions was to demonetize it and get free parking out there. Because I've been to other places as well for care for my family and staff. So that's a no. Our staff don't pay and patients don't pay to get to park.

So that's a no. Parking will remain free. Yes, Mayor. Perfect.

Commissioner, just a clarifying question. On the charity care part of it, that will be baked into the document in terms of north of what the existing charity care policy is. So that is formally part of the agreement.

I was thinking more about the other community agreements. You talked about mobile vans and things like that. That's more what I was thinking about than the charity care. The other things you've talked about you'll bring to the community. And Because if the Charlotte Observer is correct, and I don't know that they are because I'm just reading it like everybody else, there's been a lot of information about the 2,000 housing units. It was built in the Mecklenburg area, and I guess there was some delay that frustrated the commissioners, and then there was some written agreements. So there seemed to be a written agreement there of some type for that housing.

Yeah, the housing was a zoning, so that was completely outside of our ability to get there.

Did you have a written agreement with Mecklenburg over building the affordable housing?

First of all, we donated 14 acres for free without any agreement. Just say we're donating this to the county. And then there's another part of what you're alluding to was we had agreements with the housing authority for a land swap, but that was sort of a different process. Okay.

Thank you. And the last question I have, one of the things that has really confused me about this process is, and I didn't work for the government until I got in this seat, but we have to bid everything. I mean, we can't get office supplies without bidding the contract. So this is a question for our appointees. So do you think you've done your due diligence by only looking at one hospital system and why? Because they're obviously planning to go out to bid and try to lower costs. And so, you know, I understand that the UNC offers probably not good for competition. But what other hospital systems are out there that might bring more than Atrium does for this partnership? So for our board members, why do you feel like we don't, you didn't, did you look at anybody else? And if you didn't, why? And do you think that's doing your due diligence?

Well, I can tell you first with Kauffman and Hall, nationally recognized probably one of the largest uh consulting groups for hospitals especially non-profits like ours and then juniper advisors we did look and really found no one else comparable and we've seen what's happened in the state uh... with for-profit hca came and bought mission hospital unfortunately that hospital at one time was the referral center for western north carolina and it's not anymore and you know one of the question you asked me what was the hardest thing i didn't want to make a decision that led to what happened to mission hospital and i think the same thing's happening in wilmington too, novant purchased New Hanover. And when you think about it and you look at what is available, they were absolutely the best choice. And literally we spent more than two and a half years researching this.

but we weren't for sale. So we aren't a government so we are not required to go out for bids and we didn't enter into this process looking to sell we weren't looking we didn't go into this process thinking well we gotta find somebody because otherwise we're sunk we went into this process looking for an oncology partner and discovered someone who shared the things that we care about so then once we put our ego on the shelf and sat back and said okay if we're going to have a partner what are we looking for And we start with everything, the top of the pyramid. So it was all about mission alignment, care for all, excellence in care, financial means, and the ability to continue local governments. Those were our things. And we... In sort of looking at who was out there in the world, we just weren't in the process of going and saying, well, maybe this guy could give us $100,000 more. We were in the process of finding a partner who had demonstrated commitment to the things that were the most important to us. and having that partner be someone who had a very similar origin story in charlotte in north carolina this is a north carolina entity that had demonstrated commitment to you know the other side of the coin of the same community this was who this is who we wanted to marry so we we were not out looking for bids

I can't speak for Wake Med, but I can speak for Wake Forest Baptist. We had a list of 10 different national health systems that we were looking at, some local, some national. And we had an exhaustive process to be able to say, this had the advantage here, this had the advantage here, this had the advantage here. And in the end, it wasn't even close.

Okay, you okay? Okay, all right, Commissioner Waters, and then Commissioner Jackson.

Well, first of all, I appreciate everyone's time this afternoon and the way that you have received a variety of questions. This is a weighty decision. I, as I mentioned earlier, represent District 5, which is rich in culture and history, but also in disparities. Southeast Raleigh has come up quite a bit in the conversation today, so I don't take this decision lightly and appreciate the opportunity to ask these questions. And so as I wrap up questions, I just wanted to lift up something that's important in our strategic plan, inclusive prosperity. And so, Mr. Woods, I really appreciate you saying what you can control, and part of that, you know, employee wages, and I brought that up a little bit earlier, but just wondered in comparison between Atrium and Wake Mid wages, do you anticipate any shifts in what current employees from physicians to frontline workers will see in terms of wages and what that will look like if you've already done any comparison and will any see immediate increases in their pay or some remain stagnant because they're already at rates above what is to be anticipated as the new scale of salary.

Yeah, we're prohibited from having any conversations at this stage in the process. The FTC has a firewall, so we can't share any information on wages at all. The only thing I can say, just I do know from public data that the minimum wage here, I think, is $18, and ours is $18.85. So we have a we have standardized all of our minimum wage to what I said earlier, to the highest standards. So that's all I can comment, but we're not allowed to, from the Federal Trade Commission, to share any information about wages.

Well, thank you for lifting that up. I know that there are a lot of folks who wonder what that will mean for them and what that will look like. I think that concludes my final question.

Okay. Commissioner Jackson.

Yes, I just want to say thank you. We appoint many board members to have advisory councils and boards and as it was mentioned earlier is volunteer and I can tell that your heart is in it. So I just want to say thank you to each of the board members that have put in so many hours trying to figure out the direction and really appreciate your leadership. I just want to say that I do trust your insight. You are thoughtfully appointed and you continue to demonstrate that commitment to your role and thank you. to the ceos thank you um i do appreciate as commissioner waters said just receiving all of the questions we've been here a long time and i know that i've grown in my understanding of what's happening here and quite honestly really excited about the possibility of what could be in wake county two really quick questions um it was mentioned earlier that there were some faith community events happening this weekend or coming up on the 14th just wanted to know a little bit um about that intention that engagement strategy and um first baptist

Hey, Christine Craig. I sent an email, I think, through Ben and through David Ellis Friday talking about, was it Friday? Thursday, Friday with the event on the 14th. Yes, I received it. Which is this Sunday. It's going to be at First Baptist. First Baptist. Right. Yes. And it's going to include five different churches, and I've got the churches listed out. And then there's another one being planned for July 19th that we're finalizing this week. Okay.

And these events are an extension of the community meetings, essentially.

We've been invited in to participate in the service and then to do a presentation after the service for these events. So I hope everyone's welcome to come to this event on Sunday.

Okay, great. Yes, I'll be there. And then my final question is, I just want to understand the management structure that we are considering here in Wake County. How is it similar or different than the management structure or arrangement in Wake Forest Baptist Atrium Hill?

Yeah, it's almost identical. The numbers aren't exactly the same, but the split board, the local autonomy, the things we submit, we do the budget, we do the policies control, locally, of course it all has to align with the mission of the parent company, which is exactly what you want. You don't want something that isn't sticky, right? You want to have alignment of what your local and the larger organization have together. But there is that position where the board itself makes decisions for the local group and that board now has members from both Atrium and Wake Med, it will in the future, ours has Atrium and Wake Forest Baptist. It's a very similar, I mean, you can say, Gene, but I think it's almost identical to what's being proposed.

Yeah, what we feel, and sometimes it's a pretty unique structure, when you have atrium folks embedded in the local community governance together, like we're having here, we learn much more about what's going on in the community and actually it speeds up sort of what's important to that community when we're sitting at my senior table. So it's been a really effective way. If it's a sale, there's no community local voice and that's obviously what we're not doing. But this is a pretty unique construct where we blend the local folks that live in the community with Atrium there as well. So when the board would be asking, How does Atrium think about this? We have somebody there to be able to and don't have to go through a lot of bureaucracy. We feel that's actually a way to get decisions about the community needs a lot faster.

Okay. All right, that's it. Thank you.

Okay. Wow. Well, I'm going to make a quick comment and then give us a chance to close it out. As an old military guy, we always had this comment, and Admiral, I know you can appreciate this. We always say that when you fail to plan, you plan to fail. And I think that what I'm seeing here today and heard today, I think that there's a lot of going on here in terms of trying to make sure that we're stepping out and trying to plan to make sure we're putting our best foot forward and trying to find a solution for the community as a whole. So again, I just want to say thank you for everyone being here today and my colleagues for all the great questions. I know you guys, y'all got some more. So we will keep pushing forward. So there is no further board action required for this agenda item, and this concludes the agenda discussion for today's work session. So again, thank you for your participation. If there is no additional comment, this work session is hereby adjourned.