Attempts to save hospital took financial toll

Published 8:08 pm Friday, December 1, 2017


Millions of dollars were spent between the health system that closed a rural Beaufort County hospital and the town desperate to save it, according to a recent analysis by the Washington Daily News.

A review of public records and previously reported information reveals a long, expensive battle between the Town of Belhaven and Vidant Health over the closing of Vidant Pungo Hospital in July 2014.

The direct costs to Belhaven taxpayers exceeded half a million dollars, according to town records provided after months of requests.

For 70 years, Belhaven’s waterfront hospital was one of the defining characteristics of the town, which has less than 1,600 residents. It served eastern Beaufort and mainland Hyde counties.

The town joins at least 70 other locations across the United States that lost a rural community hospital since 2010. More than 700 are in danger of closing, according to a report from the University of North Carolina Center for Health Services Research.

Soon after Vidant Pungo’s closure, Belhaven residents jumped into action, with Mayor Adam O’Neal leading the charge. Dubbed the “Save the Hospital” campaign, rallies were organized, and walks to Washington, D.C., ensued.

Such travel cost taxpayers in the town at least $16,450, with some estimates as high as $20,000 — the majority of which was spent in the 2013-14 and 2014-15 fiscal years.

The town’s Board of Aldermen approved budget amendments multiple times in an attempt to cover campaign expenses, shifting the largest amount of $110,000 in 2013-14, rivaled only by another $100,000 amendment in 2014-15 and a $40,000 allotment in 2015-16. Fiscal year 2014-15 saw the greatest amount of hospital-related spending, amassing a total of more than $394,000.

Poster board at $2 each for the rallies, $57 to fill up at a gas station, wood purchased for $50 to craft the iconic “Save the Hospital” coffin — all of these drew from the Town’s coffers.

Some residents chose to look at the costs not as a dollar and cents issue, but rather as one of life and death. The old hospital sat vacant for years, as officials fought to reopen it. The once fluorescently lit hallways sat eerily dark, slowly succumbing to water damage and mold growth.

The costs of a failing hospital were not limited to the Town of Belhaven.

To keep the facility in operation meant losses of around $2.5 million each year, according to a report provided by Vidant Health.

Closing the doors did not signal an end to damage control, either. With no shortage of criticism from O’Neal and others, Vidant decided to enlist the help of lobbyists working at the U.S. Capitol.

During the period between the third quarter of 2014 and the third quarter of 2015, Vidant utilized five lobbyists, spending at least $110,000, plus two payments marked as “less than $5,000,” according to records provided under the Lobbying Disclosure Act.

“As one of the state’s largest employers, we frequently interact with governments, businesses, cities, municipalities, and the citizens that live in the 29 counties that we serve,” said former Vidant communications manager Christine Mackey in February. “Like other health systems, we establish and maintain strong working relationships with policy makers and elected officials. Our government relations office represents Vidant on health related issues in Raleigh, and in Washington, D.C., and it serves as the main point of contact for all legislative issues that are relevant to the Vidant Health system.”

“Vidant has had to respond to numerous questions from various elected officials and state and federal agencies stemming from inquiries, complaints and lawsuits brought forth by the Town of Belhaven,” Mackey said. “As a result, we had to hire additional resources to provide factual and accurate information in response to these inquiries.”

The largest, single sum of lobbying came in the third quarter of 2014, which correlates to the three months following the hospital’s closure. That particular total came to $80,000.

Although O’Neal refused to offer comments for this article, he has spoken publicly about his disdain for Vidant’s use of lobbying. There were no records indicating the Town of Belhaven secured its own lobbyists.

Upon the hospital’s closure, Vidant agreed to build a 24-hour, multispecialty clinic — carrying an initial price tag of $4 million, but in the end costing around $6 million. All of Belhaven’s doctor’s offices were brought under one roof, and specialized services were added at the clinic. A helipad was also installed to airlift patients with severe injuries.

Along with lobbying, the Town of Belhaven and state NAACP filed multiple lawsuits against Vidant Health over two years, which opened the door to the need for legal representation.

Vidant declined to give any details of the legal expenses it incurred. Although it operates as not-for-profit and receives some taxpayer money, the company is not required to make such records public.

The other part of those legal expenses, however, is the thousands of dollars spent on consultants and legal advice as the Town of Belhaven sought ways to reclaim the building and bring it back into operation.

Belhaven’s total spending of nearly $577,000 includes a large portion of the Town’s legal expenses. It does not include another $11,594 spent in 2015-16 on “miscellaneous legal” issues, some of which were related to the hospital. Those items included research on declaring a state of emergency, which O’Neal threatened to do in May 2016 to prevent the building from being demolished, as well as reviews of a February 2016 state auditor’s report on the Town’s utility bill accounts — a state investigation that O’Neal claimed was set in motion by anti-hospital residents.

Any hopes of reopening the hospital came to an end Dec. 28, 2016, as crews bulldozed through the walls, breaking it apart piece by piece.

It was the end of an era.