Community Fights Closure of Hospital and Economic Loss
Vidant Pungo Hospital will close its doors to residents of the small coastal communities in Beaufort and Hyde counties, leaving many worried not only about the loss of health care, but also jobs and residents.
By Hyun Namkoong
Take Hwy. 264 out of Raleigh and drive east for almost three hours, and you arrive in Belhaven, a coastal town of roughly 1,600 people with a single traffic light. Located on the north shore of the Pungo River, it’s only a stone’s throw from the Outer Banks and Pamlico Sound.
The announcement of the closure of Vidant Pungo Hospital, the only hospital around for 30 miles, has caused much concern for the residents of Belhaven and surrounding areas. The main road into town is conspicuously lined with signs reading, “Save our Hospital.”
“It will be one of the greatest losses this town and community will experience,” said Charles Boyette, a physician and former mayor of 25 years.
Vidant Pungo Hospital, formerly known as Pungo District Hospital, announced last September that it will close its doors in April. The hospital is owned by Vidant Health, a system of nine hospitals and numerous physician practices, wellness centers and other health care services in 29 counties in eastern North Carolina.
Vidant Health took over Pungo District Hospital in October 2011 after the hospital had been struggling to pay the bills and remain solvent.
“Lot of work that goes into running a hospital, and Vidant offered to help with staffing and promised to keep the hospital open,” Boyette said.
Disagreement over contract
According to a press release, Vidant Health agreed to pay off the hospital’s debt and invest some $2.5 million into the electronic medical-records system and facility improvements. The deal also allowed the hospital to purchase medical equipment and supplies at a reduced price through Vidant’s network of suppliers.
“Never was there any mention to close the hospital,“ Boyette said.
Boyette’s clinic is contracted by Vidant Health, but he and many residents are strongly opposed to Vidant’s decision to close the hospital.
“We were very clear we were not guaranteed to operate a hospital in the community in the long haul, just health care services,” said Roger Robertson, president of Vidant Community Hospitals.
“We hoped to keep it operating for a few more years, but it became obvious we couldn’t do that.”
Robertson cites a number of reasons for the decision to close the hospital, including the deteriorating condition of the facility and the hospital’s location in a flood zone.
Decreases in reimbursements and the state’s rejection of federal Medicaid expansion under the Affordable Care Act are other factors that were considered in the hospital’s closure, Robertson said.
Aaron Stevens, a waiter and part-time employee at the local Ace hardware store isn’t as worried about losing the health care services as he is about the adverse economic effects the hospital’s closure will have on the town and its small businesses. He fears a chain reaction from the hospital’s closure.
“Economically, it’s going to be bad for me,” he said.
With the lumber and shrimping industries long gone from Belhaven, the town shifted its focus to attracting retirees, who want not only warm weather and beaches but also access to health care. Losing the hospital, Stevens said, could mean losing the people who have revitalized Belhaven’s economy.
“We’re going to lose some residents,” said Kris Noble, pastor of Trinity United Methodist Church in Belhaven. “A lot of them came here because there was medical care.”
“We are finally seeing some positive changes, new restaurants, and just as we’re seeing that, we are losing the hospital. It’s kind of like cutting the legs [from] under us,” Noble said.
A study investigating the effects of rural hospital closures on community economic health found that the closure of a community’s sole hospital, as with Belhaven, can risk putting the local economy into a downward cycle that is very difficult to recover from.
Vidant Pungo Hospital is now the biggest employer in town, and in April some 100 people will lose their jobs. Vidant Health has provided these employees with résumé and career support services since the announcement of the hospital’s closure.
Vidant Pungo Hospital is also the town’s largest utility customer, bringing in around $400,000 a year for the town in revenue.
Skeptical about plans
Vidant plans to construct a multi-specialty clinic in Belhaven to replace the services provided by the hospital.
Robertson was unable to specify when construction will begin, but he said the multi-specialty clinic will offer primary, specialty and around-the-clock urgent care. Vidant has already purchased land and the final design and zoning permits remain in progress, he said.
But Mark van Staalduinen, a local business owner, is uncertain about the proposed clinic.
“Is the clinic really going to be what they say or is it just something to please us?” he asks. “Are they going to make this community drive to Washington and then later on to Greenville?”
For inpatient and emergency-department services, people will have to drive at least 30 miles to seek care. And it is the absence of an emergency department that has residents particularly worried.
Anson Community Hospital in Anson County was in a similar financial situation as Vidant Pungo Hospital. But that community’s acceptance of the decision to shut down the hospital and open a smaller facility stands in stark contrast to Belhaven’s.
Carolinas HealthCare System, the conglomerate that owns Anson Community Hospital, and community leaders worked together to develop a health care model that serves the needs of the community, which shares some demographics with Beaufort and Hyde counties: many uninsured people, stagnated population growth and a high burden of chronic diseases.
“Overall, the public is very happy with the new hospital. Our new facility will have all of the modern features,” Lawrence Gatewood, Anson County manager, said.
The new facility, which opens this summer, will offer health care services in a freestanding emergency department, with outpatient clinics as well.
“Our new facility goes beyond urgent care,” Gatewood said.
In 2009, the rate of death due to heart disease was twice as high in Beaufort County than the rest of the state; catastrophic events like heart attacks and strokes are linked to heart disease.
“Urgent care is a horse of another color,” Boyette said. “Urgent care can’t handle heart attacks, stroke, etc. There is no [MRI], no X-ray and no diagnostic tools. There is a great discrepancy between [what we had] and what [Vidant] is providing us.”
Noble suffered a massive heart attack last month, was declared dead for a half-hour and spent nearly a week in the hospital. He wears an external defibrillator around his hip in the event of a cardiac emergency.
“If it wasn’t for that hospital, I’d probably be dead,” he said.
Title VI complaint
On Jan. 1, the NAACP filed a Title VI complaint against Vidant Health, alleging discrimination for threatening to close the hospital.
Title VI of the 1964 Civil Rights Act “prohibits discrimination on the basis of race, color, and national origin in programs and activities receiving federal financial assistance.”
Town officials and citizens are worried about reduced access in care and services for disadvantaged and vulnerable residents. In 2011, more than 80 percent of the hospital’s patients were on Medicaid or Medicare.
“Once I realized the clinic wouldn’t have an emergency room, that troubled me, especially when I found out by law — unless they have an emergency room — by law, they’re not legally required to serve people that can’t pay in the clinic,” Bill Booth, president of the Beaufort County chapter of the NAACP and signatory of the complaint, told the Washington Daily News.
People in Belhaven understand the financial reality of the situation and that the hospital can’t continue to lose money. But the community is concerned about equitable access to quality health care for vulnerable people.
“At the end of the day, how can [Vidant] be profitable for this community? We have poor and sick people here,” van Staalduinen said.
Rural hospitals’ plight
The scene playing out in Belhaven is not unique. According to N.C. Hospital Association data, about a third of the state’s hospitals lose money every year.
Mergers similar to the one between Vidant Health and Pungo District Hospital occur frequently in rural areas of the state. Small hospitals with debt and in outdated facilities are attracted to the modern equipment and specialties offered by large hospital networks like Duke University Health System or UNC Health Care.
Rural hospitals, like Vidant Pungo Hospital, often serve communities with a disproportionate number of Medicaid and Medicare patients who are chronically ill.
“It is difficult for small hospitals in rural and eastern N.C. to survive and handle maintenance, administration,” Boyette said.
As more and more people flock to urban and economically vibrant cities, rural and remote towns like Belhaven will have to grapple with financial decisions and with ensuring access to care for residents.
“We the people need to make a decision,” Noble said. “What are we willing to do to keep a medical facility here?”