Tar Heel Tattler - July 2005

Despite ruling, this is no open-and-shut case
By Dail Willis

The state Court of Appeals says Presbyterian Hospital Huntersville, which opened in November, shouldn’t have. But it also says the hospital shouldn’t be closed. Just to mix it up more, the court says its owner should seek permission to open the hospital from the state agency that gave it permission to open in the first place.

Head pounding? It’s a symptom of watching the fights whenever a North Carolina hospital wants to expand near another. In one corner is Winston-Salem-based Novant Health, which owns Presbyterian Huntersville, Presbyterian Hospital in Charlotte, Forsyth Medical Center in Winston-Salem and four other hospitals. In the other is Naples, Fla.-based Health Management Associates, which owns Lake Norman Regional Medical Center in Mooresville, 11 miles from Huntersville. At stake: the sick and injured but mostly well-insured residents of an affluent Charlotte suburb.

This bout started years ago when Presbyterian Hospital asked the state Division of Facility Services for a certificate of need to build the $57 million, 50-bed Huntersville hospital. The division, part of the Department of Health and Human Services, uses the certificates to keep hospitals from duplicating expensive services.

Lake Norman, which was preparing to move into its $41 million medical campus, objected, saying the hospital wasn’t needed. The division agreed, denying Presbyterian’s request in October 1999.

Challenges and appeals eventually led to a meeting in April 2002 of Novant, Forsyth Medical and Presbyterian executives and division officials. Presbyterian agreed to drop litigation involving the Huntersville hospital. In return, the division agreed to reconsider the certificate request, approved Presbyterian’s request to shift some operating rooms within its Charlotte hospitals and allowed Novant to replace some diagnostic equipment at the Charlotte and Winston-Salem hospitals. A month later, the division approved a certificate for the Huntersville hospital, which opened 18 months later.

Lake Norman contended that it had been excluded from contesting the agreement between Novant and the division. That prompted the latest Court of Appeals ruling, which all parties have appealed to the state Supreme Court. Lake Norman wants the Huntersville hospital closed while the issue is settled. CEO Paul Smith says Lake Norman’s emergency-room traffic has declined 10-15% since Presbyterian Huntersville opened. It also has lost two orthopedic surgeons who didn’t want to be on call at both hospitals.

The division is appealing because it doesn’t believe its procedures were wrong. Presbyterian doesn’t want to reapply for a certificate. It has other plans, including building a 64-bed hospital in Fort Mill, S.C. That state also requires certificates of need.

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