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The entrance to a red brick building with a sign that says "The Moses H. Cone Memorial Hospital"

Public comments on Cone-Sentara merger roll in

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Public comments on Cone-Sentara merger roll in - North Carolina Health News

Commenters from Virginia and North Carolina fear that bigger isn’t always better while some see the benefit to combined resources the merger would bring.

By Taft Wireback

UPDATE: On Wednesday June 2, Cone Health and Sentara made a joint announcement that the merger of the two systems was being called off, with few available details. NC Health News is reporting a follow-up story.

As North Carolina Attorney General Josh Stein considers whether to intervene in the proposed merger between homegrown Cone Health of Greensboro and Virginia-based Sentara Healthcare, he has gotten plenty of input on both sides of the issue.

The state Department of Justice’s month-long public comment period drew more than 40 responses between late March and April 28, including one from a Cone Health physician telling Stein the proposed marriage of the two major health systems is a bad idea.

Stein and his DOJ staff are mulling whether to file a lawsuit that could torpedo the merger if they determine it would not be a good deal for North Carolina residents.

Stein’s formal approval of the proposed Cone merger is not required by North Carolina health care law. But state law does empower his department to review mergers involving charitable corporations such as Cone Health when they seek to sell or otherwise bargain away a majority of their assets.

If he objects, Stein can file a suit against the merger in civil court.

Two years ago, Stein allowed HCA Healthcare to purchase Asheville-based Mission Health without a legal challenge, but only after negotiating changes to the proposed transaction aimed at further protecting public health. Among other things, his changes to the $1.5 billion deal doubled the length of time new owners were required to continue providing an array of medical services at five rural hospitals in western North Carolina.

Community activists expressed disappointment that Stein didn’t take a more aggressive stance against the Mission takeover, while others noted that the attorney general had only limited ability to do more.

Administrative overload?

Critics of the Sentara-Cone proposal told the attorney general in a variety of ways that bigger does not necessarily mean better, especially when it comes to delivering medical services in an effective and caring way.

“I oppose this merger and respectfully argue that the merger is not in the best interest of our community nor North Carolina,” Cone Health physician Kurt Lauenstein wrote in an April 23 email to the DOJ. “I would add that ‘nonprofit’ organizations that pay 6-figure salaries do not deserve the designation of ‘nonprofit.’”

Lauenstein said he was offering his perspective “from the trenches of primary care,” making the case that as health systems get ever larger and more complex the quality of care they deliver suffers at the hands of administrative complexities and what he described as a “one-size fits all approach.”

“As Cone has grown, so has the administrative burden,” Lauenstein said. “Just check out the number of ‘management’ and ‘IT’ staff ratio to health care delivery staff . . . Where I work we have 3-4 providers working with 3 managers. This overhead diminishes flexibility, profitability and staff morale.”

Cautionary comments also included a protest from hospital officials in Randolph County who claim that Cone has neglected to “seek or obtain” their required approval of the merger’s impact on a jointly owned cancer center.

Another broadside came from a Virginia resident who also submitted copies of his separate complaints to two federal agencies against the proposed merger because of its alleged potential to drive up patient costs by stifling competition.

The public input also featured somewhat contrasting viewpoints from two elected Greensboro officials who are facing off in the community’s upcoming mayoral race.

Commenters who supported the Sentara-Cone plan made similarly impassioned pleas that smaller, Greensboro-centered Cone Health would benefit greatly from its combination with the Sentara network that they depict as having a like-minded approach to “value-based” health services.

“Sentara has committed to investing strongly in our communities – providing much needed capital to the system to assist it in meeting community needs that it simply could not do itself,” former Cone Health CEO Tim Rice said in a comment he sent April 14.

Rice, who retired at Cone Health six years ago, asserted that in addition to improving Cone’s financial outlook Sentara had promised to invest in “existing health-focused foundations that serve Guilford, Rockingham and Alamance counties” where Cone dominates.

Proponents also included Greensboro Mayor Nancy Vaughan who said the two health systems’ “combined resources and knowledge will only lead to providing high quality, affordable and accessible health care in more ways and more places.”

Differences in scale

At issue is a proposed merger between two systems that together own about $11.5 billion in assets and generate roughly $8.5 billion per year in revenue, according to the corporate pair’s most recently available Form #990 financial reports for 2019.

In terms of sheer size, Cone ranks No. 6 among North Carolina health systems with about $2.2 billion in annual revenue and 13,000 employees. Sentara’s yearly income is roughly three times greater and it employs 30,000 people.

Sentara is known for its political clout in Virginia, where it has headquarters in Norfolk and also oversees the in-house Optima Health and Virginia Premier insurance plans — products that insure nearly 1 million Virginians.

In contrast, Cone’s health insurance plan, Health Team Advantage, is a Medicare Advantage program that insures only about 15,000 people.

The Sentara network already serves a sizable population in North Carolina’s northeastern sector, a Tar Heel presence that includes one of the Virginia-based system’s 11 hospitals. That hospital is in Elizabeth City where the health care giant plans to build a replacement for the current, 60-year-old Sentara Albemarle Medical Center.

Other OKs required

In addition to getting the green light from Stein, the merger also must pass muster with the Federal Trade Commission, which reviews such transactions and generally takes a dim view of the nationwide trend toward consolidating health care systems into larger conglomerates.

The federal agency believes that by reducing competition, health-system mergers ultimately result in higher consumer costs. But because Cone and Sentara’s existing service areas do not overlap, that could be a difficult case to make in this instance.

The merger plan calls for Cone Health to essentially become a satellite division of the Sentara network with the Greensboro-based leadership having a proportional number of seats on the combined system’s governing board.

The merger plan initially called for current Cone Health CEO Terry Akin to remain in charge of the Greensboro division. Akin later announced he would be leaving after the merger for personal reasons that he said did not stem from any dissatisfaction or disagreement with the impending Sentara-Cone marriage.

Sentara also plans to bring its Optima Health insurance plan to Triad consumers, something the Greensboro mayor and several other supporters mentioned as a plus.

“This new insurance option will be tailored to the needs of local consumers and businesses – something Cone Health could not do on its own without a partner experienced in those markets,” Vaughan said.

The North Carolina Department of Insurance recently approved the part of the merger that would give Sentara oversight of Cone’s Health Team Advantage plan. Insurance Commissioner Mike Causey signed off on that part of the deal May 6, a spokesman for Causey said recently.

“Sentara currently has no plans to make material changes in Health Team Advantage’s business operations or corporate structure or management, other than as may arise in the ordinary course of business,” Sentara vice president Louis Patalano IV said in the health system’s application submitted to the Department of Insurance in February.

Green lights

Stein’s more broad-based examination is continuing without a timetable for completion, DOJ spokeswoman Laura Brewer said last week.

“Our office is still conducting the review,” Brewer said. “It’s always challenging to set a timeline; the review will take as long as it takes to be thorough.”

The state Department of Justice responded to North Carolina Health News’ request for the public submissions Stein had received during the recent comment period, providing letters and email messages submitted by a total of 42 people.

All but six of the commenters expressed opinions for or against the proposed merger, with 19 in favor and 17 expressing doubts or opposition.

The great majority of comments supporting the merger – 13 or 68 percent – came from people with such ties to Cone Health as current or prior employment in executive positions, service on the Greensboro health system’s board of trustees, or membership on related supervisory panels such as the Cone Health Foundation or the health system’s Cancer Center Advisory Board. (Disclosure: Cone Health Foundation has provided support for mental health reporting at NC Health News)

“Cone Health’s mission will not change, and the expertise and resources brought by our partnership with Sentara will prove to impact the community that we all serve,” said Lenora Campbell, a Cone Health trustee and dean of NC A&T State University’s College of Health and Human Sciences in Greensboro.

“The significant capital investment brought by this new partnership with Sentara will expand access to traditional and digital health programs and build new health-care facilities, and enhance access to health care for some of our most underserved populations,” added the health-school dean at the nation’s largest HBCU.

Including Campbell’s remarks to Stein, six of the 19 supportive comments came from members of the Cone Health Board of Trustees that voted unanimously in favor of the Sentara deal announced in August with an unspecified “mid-2021” target date for completing the transaction.

And warning signals

One of the cautionary comments came from a Black member of the Greensboro City Council who is challenging Vaughan for the mayoral seat in the upcoming citywide elections.

Council member Justin Outling, a Greensboro lawyer, urged Stein to make sure that “vulnerable and marginalized community members receive the medical care they need and are not harmed by the requested merger or acquisition.”

Outling noted that Novant Health pledged $50 million toward such ends in January when it acquired New Hanover Regional Medical Center in Wilmington and that HCA Healthcare similarly had committed about $90 million “to the Asheville area” in its earlier Mission Health purchase in western North Carolina.

“To date, there is no publicly available information on the financial contributions Sentara Healthcare-Cone Health will commit to Greensboro area endowments/foundations to benefit the Greensboro community,” Outling wrote, suggesting that Stein should look into that aspect of the merger and tell the public what he learns.

Another red flag came from a lawyer representing Randolph Health in Randolph County on the southern border of Cone Health’s current domain. The two systems jointly own and operate a cancer treatment center on Randolph Health’s hospital campus in Asheboro.

The center’s operating agreement requires either party to get the other’s consent for any transaction that would change the facility’s ownership ratio by more than 25 percent. As it stands now, Randolph Health is the 60-40 majority owner of the Asheboro treatment center.

But Sentara’s senior-partner status in the proposed merger would introduce new ownership and trigger the cancer center’s required approval clause, Randolph Health attorney Robert L. Wilson, Jr. said in an April 14 letter to Stein.

“Cone Health has not sought or obtained such written approval from Randolph,” wrote Wilson, who is based in Raleigh. “Cone Health has not provided Randolph any information regarding Cone Health’s merger with Sentara.”

He added that his client “only learned of this merger through published reports and is unable to make an informed decision regarding approving the transfer of membership interest” in the joint cancer center.

Contacted recently, Wilson said he could not comment on an “ongoing matter.”

Cone and Randolph Health have a complicated relationship. Cone had been considering a merger with the Asheboro-based system last year, but the talks fell apart in March 2020 about five months before the Cone-Sentara deal was announced.

Financially troubled Randolph Health later unveiled plans to sell its assets including a 145-bed hospital to the Dava Foundation, a nonprofit health care provider based in Manchester, Tenn.

Voices of business, government

In addition to comments that Stein received from those professionally linked to Cone Health, other support for the proposed merger came from what might be called “the usual voices” who participate in such proceedings – elected local officials, leaders of business groups and current or former foundation officials that look to health care systems for support.

“Their mission of providing high quality health care resonates with employers looking to invest in our community,” Brent Christensen, president and CEO of the Greensboro Chamber of Commerce, said of Cone Health’s local track record. “We believe this partnership will surely continue the strong tradition of great health care for the citizens of Greensboro.”

Critics of the proposed merger included Triad physicians and nurses, former Cone patients and several residents of Virginia who either loved or hated Sentara. Seven of the 18 commenters who disagreed with the proposed merger identified themselves as medical professionals, including Lauenstein and three other doctors.

“My concern is that Sentara will be responsible for allocating resources to address the medical needs of the Greensboro community,” said Dr. Jeffrey Medoff, a Greensboro gastroenterologist who has practiced in North Carolina for 44 years. “These will have to compete with other demands on Sentara, a Virginia-based organization with far greater investment and commitment in their home state.”

Medoff is currently affiliated with Wake Forest Baptist Health, but said he also has been on the medical staff at Moses Cone, Duke and Wesley Long hospitals.

Two Triad-area physicians – Drs. James Maxwell of Greensboro and Yun Boylston of Burlington – said the merger would be good for residents of the region. Both also are members of Cone Health’s board of trustees.

“By building on Sentara’s Optima health plan experience, we will (be) able to provide an affordable option for health insurance that will be tailored to our community, improve wellness and keep healthcare costs manageable,” wrote Boylston, an Alamance County pediatrician.

Virginia critique

Commenters from Virginia included James Sherlock, a retired U.S. Navy captain and architect who included in his submission complaints against the merger that he also had filed with the FTC Bureau of Competition and the U.S. Department of Justice’s antitrust division.

Sherlock, of Virginia Beach in the heart of Sentara country, alleged that the health care giant relies on an aggressive business style that uses its lucrative insurance arm to reward Sentara-linked providers with high payments while starving medical practices that are not part of the system.

Meanwhile, other insurers cannot compete with Sentara health plans because of Optima’s cozy relationship with the health care branch of the Norfolk nonprofit’s business model, he said.

“N.C. has to my knowledge never seen the combination of integrated market power in both healthcare services and health insurance that Sentara brings,” Sherlock said in an email to NC Health News. “They wield that combination as both sword and shield against competitors in both industries in ways you may not be able to imagine.”

But proponents say the economic realities of the healthcare industry make mid-size systems such as Cone Health particularly vulnerable: They can remain independent for only so long in the face of rising costs, increased patient expectations, tight-fisted insurers and wealthier competitors.

Cone Health has responded by choosing its best available option to create “a great outcome for our region and communities we serve,” said Ed Cone, a longtime board member from the family whose textile-industry wealth and largesse gave birth to the hospital system that now bears its name.

“Consolidation in healthcare is a reality, and Cone is one of the last independent systems in a state full of hungry giants,” Ed Cone said in a March 26 email to Stein and his staff. “We chose to partner with a like-minded system – nonprofit, community focused – that will allow us to continue to offer lower prices than our big competitors while focusing on wellness and value-based care for all people.”

Coronavirus Today – May 19 Here’s how Gov. Cooper wants to spend $5.7 billion in federal COVID funds; A dose of fun with your vaccine

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Coronavirus Today – May 19 Here’s how Gov. Cooper wants to spend $5.7 billion in federal COVID funds; A dose of fun with your vaccine - North Carolina Health News

Gov. Roy Cooper describes federal coronavirus relief aid as ‘transformational.’

By Anne Blythe

Gov. Roy Cooper issued his plan Wednesday for how he would like the state to spend the next $5.7 billion coming to North Carolina from the federal government for coronavirus relief and recovery, describing the injection of American Rescue Plan Act funds as having the potential to bring revolutionary change to the state. 

As vaccinated people shed their masks and ease back into life with fewer restrictions on where they can go, crowd sizes and who they can be around, Cooper reminded North Carolinians of the many inequities exposed and exacerbated by the pandemic.

“This pandemic brought us a once in a generation challenge and these funds have brought us a once in a generation opportunity,” Cooper said. “Let’s use them to make transformational change for our state.

“Simply put: We can revolutionize North Carolina. We can train workers, educate students, connect communities, and improve health.”

In presenting his spending plan, Cooper divided it into five themes and funding amounts associated with each. They were:

  • $1.379 billion for Assisting Individuals and Families Hardest Hit;
  • $2.335 billion for Upgrading Infrastructure;
  • $1.010 billion for Preparing the Workforce;
  • $680 million for Promoting Business Development and Innovation; and
  • $312 million for Positioning Government to Best Serve North Carolinians.

While none of the categories directly mentions health, the governor’s proposed plan for spending the federal funds would direct millions of dollars to local public health departments, early childhood programs, wellness promotion, food security, affordable housing, eradicating lead and asbestos in child care facilities and schools, investing in broadband infrastructure that can open access to telehealth, and academic research.

Among the proposed investments are:

  • $300 million to expand pre-K education and child care access to children from birth to age 5.
  • $160 million for lead and asbestos testing and remediation in schools and child care facilities;
  • $50 million for the Rapidly Emerging Antiviral Drug Development Initiative, or READDI, at the UNC-Chapel Hill to help develop therapeutics for COVID-19 and other viruses that could be pandemic threats.
  • $10 million to Winston-Salem State University for research and infrastructure at its Center for Excellence for the Elimination of Health Disparities.
  • $15 million for the NC Policy Collaboratory to set up a research grant program for Historically Minority-Serving Institutions.
  • $100 million to the State Health Plan to offset costs incurred from the pandemic such as for testing, vaccinations and treatment for COVID-19.
  • $65 million to the state Department of Health and Human Services, the state Department of Administration and state Department of Public Safety to provide grants to vulnerable individuals and families affected by COVID. Those people would include people at risk of becoming homeless, young people transitioning out of the state’s foster care programs, the elderly, people with disabilities and their caregivers, domestic violence victims and children in the juvenile justice system.
  • $50 million to improve ventilation and other health and environmental concerns at state Department of Health and Human Services facilities, as well as at those run by the Department of Public Safety.
  • $18 million to North Carolina’s seven state-recognized American  Indian tribes to help with community needs caused by the pandemic. None has received federal COVID-19 relief funds directly.

Cooper also proposed investing $250 million in grants of either $250 or $500 that would be distributed to low- and middle-income families with children.

North Carolina legislators included a similar grant program in their spending plan for a previous round of federal COVID relief funds sent to the state from money appropriated by Congress in December. All families with children, under that plan, were to receive $335 checks under the Extra Credit Grants program.

Cooper’s proposal would not send checks to all families, but he said Wednesday he is open to discussions with lawmakers about where there is give and take in getting a plan that works best for the state.

Lawmakers to start filling in numbers

North Carolina lawmakers have not released their proposal for spending the federal funds that started arriving in the state this week.

President Joe Biden signed the American Rescue Plan Act on March 11. The federal guidance for how those funds could be used were issued on May 10.

On Thursday, the House Appropriations Committee is set to meet in the morning to discuss Senate Bill 172. That lays out the framework for how they propose to spend the federal relief funds.

This year, Cooper and Republican leaders in the state House of Representatives and Senate have told North Carolinians they would work in a new spirit of compromise as budgets and spending plans are hammered out for the months and years ahead.

The governor and lawmakers were in a standoff for much of the past two years over a budget that Cooper vetoed and lawmakers never mustered enough votes to overturn his veto in both chambers.

That resulted in a series of “mini-budgets” being adopted for different departments, with neither political side giving in on their stances over Medicaid expansion, supported by Cooper, or the size of teacher raises, which the governor wanted to be higher than lawmakers proposed.

Some of the proposals that Cooper has put forward are recommendations for one-time investments, but some call for renewed spending in years ahead, a recommendation that can sometimes rankle Republican lawmakers who like to keep the state purse strings tighter than many Democrats.

“We have five years in which to invest this money over a five-year period of time,” Cooper said. “We’re trying to emerge from the pandemic, so we need a shot in the arm. Particularly in the area of education and workforce training.”

Cooper’s proposal calls for scholarships that would be available for more than one year to try to help those who either lost their jobs or want to go in a different career direction because of the coronavirus pandemic.

“If we get five years down the road and we see that we don’t need to continue with this investment any more, then we won’t,” Cooper said. “But when you look at the demand that we have for skilled workers in all of these jobs that we’re creating, and the challenges that our children have had doing remote learning and trying to catch up, we do need to invest in things that we could continue to invest in in the future but recognize that it could be for a finite period of time.”

Bringing vaccines to people

In recent weeks, the state’s vaccination rate has slowed after several months of intense demand. During the week of May 10, providers in the state only administered 241,723 shots, compared to a peak of 681,586 vaccinations given during the first full week of April.

North Carolina public health teams are trying to increase interest in vaccinations by joining with organizations and businesses to hold events that might include give-aways such as a shot with a shot or free food, celebrations and other reasons to visit the sites.

Vaccine on the Green will bring coronavirus shots to the new Dorothea Dix Park in Raleigh this Friday, May 21, through Sunday, May 23. Free Pfizer vaccines will be available to anyone 12 or older, with both appointments and walk-in slots available. There also will be music, food trucks and games on the lawn. 

Another event is set for May 20 to 22 at the North Carolina Zoo in Asheboro. Anyone who comes for a shot between 10 a.m. and 4 p.m. will also get a ticket for a future visit to the Zoo. Another vaccine event will be held there from June 10 to 12.

Currently, the only way to visit the zoo is to have a reservation. 

“What better place to Bring Summer Back than the North Carolina Zoo! Families can get the double gift of protection from COVID-19 and a free day at the zoo,” NC DHHS Secretary Mandy Cohen said in a statement included in a press release announcing the vaccination opportunities.  “Please get vaccinated so we can get back to the people and places that we love – like the zoo.”

Appointments are available at StarMed.care and walk-ins are welcome. Visit nczoo.org/vaccine to learn more.

Coronavirus by the numbers

According to NCDHHS data, as of Wednesday afternoon:

  • 12,938 people total in North Carolina have died of coronavirus.
  • 993,547 have been diagnosed with the disease. Of those, 1,117 are in the hospital. The hospitalization figure is a snapshot of people hospitalized with coronavirus infections on a given day and does not represent all of the North Carolinians who may have been in the hospital throughout the course of the epidemic.
  • 963,539 people who had COVID-19 are presumed to have recovered. This weekly estimate does not denote how many of the diagnosed cases in the state are still infectious. Nor does it reflect the number of so-called “long-haul” survivors of COVID who continue to feel the effects of the disease beyond the defined “recovery” period.
  • To date, 12,959,749 tests have been completed in North Carolina. As of July 7, 2020, all labs in the state are required to report both their positive and negative test results to the lab, so that figure includes all of the COVID-19 tests performed in the state.
  • People ages 25-49 make up the largest group of cases (39 percent). While 14 percent of the positive diagnoses were in people ages 65 and older, seniors make up 83 percent of coronavirus deaths in the state. 
  • 232 outbreaks are ongoing in group facilities across the state, including nursing homes and correctional and residential care facilities.
  • As of Wednesday, 232 COVID-19 patients were in intensive care units across the state, with a total of 802 in the hospital. 
  • As of May 18, 4,058,877 people have had the first shot of their two-shot regimen, another 287,332 North Carolinians have received a single-shot coronavirus vaccine. In sum, 41.4 percent of the population has had at least one dose of vaccine.
A hospital building in Ashboro which belongs to Randolph Health and is about to be sold to another company

Randolph Health finds a buyer, county to pay $20M as part of the deal

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Randolph Health finds a buyer, county to pay $20M as part of the deal - North Carolina Health News

The debt-riddled rural provider sought a buyer for years. With the help of a loan from the state to the county, the hospital is slated to change hands before the end of the year.

By Liora Engel-Smith

Update: The agreement with Dava has been finalized, a Randolph spokeswoman said in an email on Monday, Aug. 31. 

Yet another Piedmont Triad health care system announced its intentions to combine with an out-of-state suitor.

The Dava Foundation, a Manchester, Tennessee nonprofit, is expected to purchase the Asheboro-based Randolph Health, a 145-bed hospital that offers maternity and cancer care, among other services. The exact terms of the purchase are still being negotiated, but a final agreement is days away, Randolph Health leader Angela Orth said on Thursday.

The hospital has been looking for a partner for the last few years.

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“The process of looking for a buyer has been really difficult,” she said. “And we’ve not — up until this point — really found a buyer who’s been interested in keeping all of our services open, keeping the hospital open and purchasing all of our assets.”

Earlier this month, Cone Health, a neighboring system to the north, announced plans to merge with Norfolk, Virginia-based Sentara Healthcare. Cone and Randolph had discussed a potential union in the past, but most recently, talks dissolved in March amid the spread of coronavirus in the state, Orth said. Around the same time, Randolph filed for Chapter 11 bankruptcy and hired outside help to look for a buyer.

Randolph’s financial struggles date back to a $49 million 2007 bond the hospital took to build the newest addition to its facilities, an imaging and endoscopy area. Parts of the hospital date back to the 1930s and are in such disrepair, Orth said, that patients cannot be seen there. But the bond came due recently, she added, and the health system was unable to cover payments, despite a modest positive margin from operations in the last quarter of 2019.

Orth declined to talk in detail about the search but said the decision to go with Dava came after extensive due diligence. In addition to buying the hospital for an undisclosed amount, Dava will receive a $20 million infusion from Randolph County to renovate the Asheboro hospital’s facilities.

The money would come from the state’s Rural Health Care Stabilization Act, a fund the General Assembly created in 2019 to shore up struggling hospitals. The law was championed by state senate leader Phil Berger (R-Eden) and recently retired Sen. Jerry Tillman, who represented Randolph County for 18 years.

Dava will not repay the loan, however; the county will.

County officials have signaled their eagerness to retain the hospital, one of the largest employers in the community, even with a $20 million price tag.

“It’s more than just a place for patients to go for health care,” Darrell Frye, chairman of the Randolph County Board of Commissioners, said about the decision. “It has a lot to do with the economy of our county. It has a lot to do with our future economy and our ability to recruit and retain jobs.”

Frye said the county could easily pay the 20-year loan to the state without increasing taxes. Though the county has several other obligations, including the construction of new schools, he added, repaying the loan would not interfere with those commitments. The county will receive two seats on Randolph Health’s new board in return, Frye said.

Coronavirus on top of bankruptcy

As for many rural hospitals across the state, coronavirus has not been kind to Randolph Health’s bottom line. Suspending elective surgeries in March, April and part of May, resulted in more than a $1.6 million loss, according to court filings. Though patients have slowly begun to return to the hospital for elective procedures, Orth said not all of them have come back and the hospital is doing fewer elective surgeries now than they had last year.

Operational changes have also hurt the hospital’s bottom line. Court filings show that the hospital shut down its ICU and decided to transfer most COVID-19 patients to Cone Health. From a financial standpoint, COVID-19 patients could have made up for some of the losses the hospital incurred, but Orth said the decision to divert patients was a matter of capacity.

The hospital does not have an infectious disease specialist, she said, and the staff wasn’t prepared to care for patients who needed to be on a ventilator for a long time, something that can happen to COVID patients.

The hospital focused its resources on sectioning out the emergency department to create a separate area for patients with respiratory symptoms, Orth added, and has created a temporary holding area for up to four intensive care patients. It was the right thing to do for patients, Orth said, even if the hospital’s margins suffered in the short run.

The ICU has not yet reopened, Orth said on Thursday.

With bankruptcy proceedings happening almost simultaneously, Orth said it became clear that the hospital would need a buyer and that search began in March.

“It became obvious to us that in order to achieve the goal of protecting local health care, we must act quickly … and that is how Java surfaced,” Orth said.

The buyer 

Both Orth and Frye speak highly of the Dava Foundation, which is incorporated in Manchester, Tennessee, that state’s Secretary of State filings show. According to Randolph’s press release, another company, the Nashville, Tennessee-based Java Medical Group, will manage the hospital.

Both Java Medical Group and Dava Foundation have Bappa Mukherji in common. The Tennessee Secretary of State lists Mukherji’s name and address for Dava Foundation. Mukherji is CEO of Java Medical Group, according to the company website.

Orth and Frye said they’ve been impressed Java, Dava and Mukherji. But these entities are difficult to track.

According to Java’s website the company “partners with rural hospitals to improve financial performance while delivering quality medical care.” It lists three hospitals on its website — two in Alabama, and one in Mississippi.

Java has no phone number on its website. An email requesting comment on Thursday about the proposed union with Randolph was blocked and other interview requests through a form on the company’s website Thursday and Friday went unanswered.

Dava does not appear to have a website, and there are no financial filings for the organization on Guidestar, the information database for foundations and nonprofits, despite Dava being approved by the Internal Revenue Service in 2018. It is currently listed as having $0 assets and $0 in receipts.

Mukherji, however, spoke at a recent board of commissioners meeting that was also streamed online.

“What is important for us is that we do not want to sacrifice any of the service lines that are currently at the hospital,” he said. “If it is being done there today we intend to continue to maintain those services … we do not want to lose any jobs and we do not want to lose any services.”

Mukherji said Java can make that happen by using federal funds that are available to rural hospitals, he did not, however, explain which funds would be used and if Randolph had used similar support in the past. He told the board of commissioners that he is looking to generate enough revenue to reinvest in the hospital and recruit additional providers to the area, including in outpatient addiction rehabilitation services. He said hospital staff vetted the plan and found it “viable and doable.”

When asked about the $20 million, Mukherji said the money will be used “almost exclusively” to renovate the hospital and update its equipment.

Mukherji’s vision for Randolph is so rosy that it is almost at odds with the realities of rural hospitals in North Carolina. Hospitals across the state have struggled with negative margins and as a result have cut costly but needed services, including maternity and inpatient psychiatric care. But Mukherji spoke of a long-term expansion of services and specialties at Randolph.

The board of commissioners, for their part, highlighted Mukherji’s track record and experience in managing rural hospitals. They did not speak of a scandal involving a past Java employee Ed Henry, also a former Alabama state representative and a former manager of one of Java’s Alabama hospitals. Henry was indicted in 2018 for a pill mill scheme that took place from 2015 to 2017 at a company he established.

Orth said Randolph Health is aware of the scandal.

“We have discussed the circumstances surrounding the allegations surrounding Mr. Henry with Java representatives,” Orth said. “The allegedly improper conduct occurred prior to his association with Java. Java promptly severed ties with Mr. Henry when they learned of the allegations and there’s no suggestion that Mr. Henry’s actions in any way involved Java.”

Orth said Randoph’s administration is “satisfied that this issue has no bearing on Java’s fitness to serve as our property buyer.”

A faucet with water flowing from it, as an illustration for drinking water contamination, with substances such as 1,4 dioxane and PFAS

New DEQ data show ‘staggering’ levels of PFAS in Cape Fear River basin

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New DEQ data show ‘staggering’ levels of PFAS in Cape Fear River basin - North Carolina Health News

The DEQ required 25 utilities in the basin to test for “forever chemicals” at their sewer treatment plants for three months. One scientist called the results of those tests “incredibly high.”

By Greg Barnes

A water sample taken in September from the Sanford sewage treatment plant that discharges into Deep River uncovered “staggering” concentrations of forever chemicals, newly released documents from the N.C. Department of Environmental Quality reveal.

The sample contained perfluorooctanesulfonic acid — or PFOS — measuring 1,000 parts per trillion. That is more than 14 times greater than the U.S. Environmental Protection Agency’s health advisory of 70 parts per trillion for drinking water.

The data coming out of Sanford is just one example of the high levels of potentially carcinogenic chemicals that a new monitoring program has detected in rivers and streams throughout the Cape Fear River basin, from Reidsville to Wilmington.

From July to September, the DEQ required 25 utilities in the basin to test for 19 or more different types of per- and polyfluoroalkyl substances, collectively known as PFAS, at their wastewater treatment plants. The DEQ made the data public in mid-January.

Related: DEQ identifies Greensboro company responsible for discharging chemical
DEQ records show repeated releases of probable carcinogen into Haw River

The highest level of total PFAS detected was in Sanford, which recorded a concentration of 4,026 parts per trillion in September. Burlington saw the next highest spike — nearly 2,296 parts per trillion in August.

Of the 25 utilities, 19 recorded total PFAS levels above 100 parts per trillion at different periods in the reporting cycle. (No data was provided for one of the 25 utilities, Columbus County.)

National PFAS study

To put the DEQ data into perspective, the Washington D.C. based Environmental Working Group recently tested tap water at 44 locations in 31 states and the District of Columbia. Data from that testing, which was released last week, found measurable levels of PFAS at all but one site.

The highest level detected in the national study was 186 parts per trillion at an elementary school in Brunswick County, at the North Carolina coast. Brunswick County pulls its drinking water from the Cape Fear River.

David Andrews, senior scientist for the Environmental Working Group, reviewed the DEQ’s data and called the numbers “absolutely incredibly high.” Only one other site in the organization’s national study measured PFAS above 100 parts per trillion in drinking water.

Understanding parts per million, billion and trillion

Keeping track of such small quantities can be tricky.

  • A part per million is like diluting four drops of ink into a 55-gallon drum of water.
  • A part per billion is like diluting two drops of ink into a large gasoline tanker truck filled with water.
  • A part per trillion is like diluting less than half a drop of ink into an Olympic-sized swimming pool.

PFAS in drinking water

Although the DEQ required the 25 North Carolina utilities to test for PFAS only at sewer plants — and not in tap water — it is a known fact that high levels of PFAS are flowing downstream and getting into public drinking water for hundreds of thousands of people who live in the Cape Fear River basin.

Sanford’s Big Buffalo wastewater treatment plant, where DEQ documents show the highest readings were recorded, lies about 15 miles upstream from Sanford’s drinking water intake.

It is not known whether high levels of PFAS showed up in Sanford’s drinking water after the September sample was taken. Scott Christiansen, the city’s water filtration administrator, said the city doesn’t regularly test for PFAS because the chemicals are unregulated, and no one alerted him to the high levels detected at the Big Buffalo sewer plant.

In an email to NC Health News, DEQ spokeswoman Sarah Young wrote that “there have been no documented levels of PFOS at the downstream water supply intake (for Sanford) showing a concentration greater than the EPA drinking water health advisory level.”

Young noted that two rounds of testing by the N.C. Policy Collaboratory, which for about two years has been testing for PFAS in all of the state’s municipal water systems, found “no high levels of individual PFAS compounds in the City of Sanford water sample.”

But Duke University professor Lee Ferguson, a collaboratory director, said in an email that it is “entirely feasible” the contamination had not made its way to Sanford’s drinking water intake when the collaboratory took its sample.

The sample was drawn Sept. 5, a day after the sample at the Big Buffalo sewer plant was taken. Big Buffalo lies about 15 miles upstream of the Sanford water intake.

The sample at Big Buffalo contained 2,650 parts per trillion of a specific PFAS, called 6:2 fluorotelomer sulfonate, which is widely used in firefighting foam and metal plating. The absence of the chemical suggests that the contamination had not yet reached Sanford’s intake when the collaboratory took its sample, Ferguson said.

A bar chart showing PFAS levels in NC sewer plants
These PFAS levels were measured in a N.C. Department of Environmental Quality monitoring program at utilities in the basin from July through September. Note that these levels were found in the sewer plants, while the orange line represents the federal health advisory level for drinking water. Data source: NC DEQ. Chart credit: Yen Duong.

Officials with the DEQ and Scott Siletzky, Sanford’s water reclamation administrator, said they do not know where the contamination came from. The DEQ’s monitoring  program aims to find out which industries may be responsible.

In Fayetteville, about 45 miles downstream of Sanford, the level of PFOS in drinking water remained below the EPA’s health advisory during the monitoring period, but total PFAS spiked to as much at 244 parts per trillion.

What are PFAS?

Per- and polyfluoroalkyl substances (PFAS) are a group of man-made chemicals that includes PFOA, PFOS, GenX, and an estimated  5,000 types of PFAS, none of which are federally regulated. PFAS have been manufactured and used by industries worldwide since the 1940s, used in everything from Teflon pans to raincoats to dental floss. They are also used in firefighting foams.

The two most extensively produced and studied, PFOA and PFOS, have been phased out in the U.S., but they don’t break down easily and can accumulate in the environment and in the human body. There is evidence that exposure to PFAS can lead to adverse human health effects.

What are the health advisories for PFAS?

The U.S. Environmental Protection Agency has set a health advisory level for PFOA and PFOS at 70 parts per trillion, either by themselves or in combination. There is no advisory for the thousands of other PFAS, but the N.C. Policy Collaboratory uses the 70 parts per trillion standard to notify utilities when it detects any type of PFAS exceeding that level in drinking water.

Mick Noland, chief operations officer for the Fayetteville Public Works Commission’s  Water Resources Division, could not say whether the spike of PFAS in Sanford may have caused the high levels in Fayetteville. River flow and other factors come into play, he said.

Like most water treatment plants, Fayetteville lacks specialized filtration equipment to screen all PFAS from its drinking water. The levels have since retreated to 83 parts per trillion in January.

Farther downstream in Wilmington, the Cape Fear Public Utility Authority reported no spikes in the level of PFOS entering its water treatment plant during the monitoring period. Levels of total PFAS remained consistently high — between 169 and 271 parts per trillion — throughout the monitoring period at one sewage treatment plant.

Health effects of PFAS

Fayetteville is upstream of the Chemours chemical plant, where the release of PFAS for decades continues to foul the drinking water downstream for New Hanover, Brunswick and Pender counties. Although the DEQ stopped Chemours from discharging PFAS into the Cape Fear River, it still seeps into the river through contaminated sediment and groundwater around the plant.

According to the EPA, a person who drinks a level of 70 parts per trillion of PFOA or PFOS over a lifetime  — or a combination of them both — stands an increased risk of adverse health effects, including testicular and kidney cancer, developmental effects to fetuses during pregnancy, low birth weight, liver and thyroid disease, antibody production, high cholesterol, and ulcerative colitis.

But there is mounting evidence that suggests PFAS are a health risk at much lower levels. While North Carolina continues to follow the EPA health advisory, other states have or are considering lowering theirs, some to less than 15 parts per trillion.

A consent order entered in February among the DEQ, Chemours and the environmental group Cape Fear River Watch speaks to the growing concern of PFAS contamination on human health.  The order requires Chemours to provide filtration systems to people living around the plant whose private well water tests above 10 parts per trillion for a single PFAS or 70 parts per trillion for a combination of them.

The Environmental Working Group has proposed an even stricter standard for PFAS at 1 part per trillion. Its proposal is based on a recent Harvard study that reached the same conclusion.

****

The DEQ began its monitoring program at the 25 municipal wastewater treatment plants as a way to better understand and begin to address PFAS and another, perhaps more carcinogenic chemical called 1,4 dioxane, which has also been found in high concentrations in the river basin.

The plan is to identify the amount of the chemicals flowing into the sewer treatment plants and then determine which industries are responsible for putting them there.  A second phase has begun that asks industrial dischargers to monitor for releases of PFAS and 1,4 dioxane. Letters detailing the monitoring requirements went out to at least 19 industries, which had until Jan. 31 to complete the monitoring.

Andrews, the Environmental Working Group’s senior scientist, applauded the DEQ’s monitoring program.

“This is absolutely the right track of figuring out where this contamination is coming from and trying to make it stop,” he said.

North Carolina, along with Michigan and New Jersey, are leading the country in that regard, Andrews said. He noted that Michigan and New Jersey have filed lawsuits against polluting industries.

Monitoring program showing results

Because PFAS are unregulated, North Carolina currently has little control over industries that are fouling its waterways. But the state can go after cities that violate terms of their pretreatment pollution permits.

The state has already taken enforcement actions against Greensboro and Reidsville. The DEQ cited those cities for violating their pollution permits by failing to timely notify the state and downstream water utilities about large releases of 1,4 dioxane that were discovered through the monitoring process.

The DEQ said the citations were issued because the chemical showed up downstream in the town of Pittsboro’s drinking water.

shows a map of the Cape Fear River basin witih landmarks noted, including Fayetteville, where GenX and 1,4 dioxane and PFAS entered the river
This map shows the length of the Cape Fear River basin. Source: National Oceangraphic and Atmospheric Administration.

But no enforcement action has been taken against Sanford, even though the DEQ acknowledges that the 1,100 parts per trillion of PFOA and PFOS detected at its sewer plant could have flowed downstream and caused the levels in Sanford’s drinking water to exceed the EPA’s health advisory.

Siletzky, who oversees the sewer plant, admitted that he did not notify downstream utilities, saying he “wouldn’t know how to do it.”

Siletzky said the PFOS contamination appears to be coming from firefighting foam,  which has been used largely by the military and civilian firefighters for training purposes. It has been found in groundwater at high levels at military bases across the country.

Industries voluntarily began phasing out the manufacture of PFOS and PFOA in 2006. Although its manufacture is limited in the United States today, it is still being imported.

Sanford has voluntarily agreed to undergo at least another six months of monthly monitoring and evaluation of the potential sources of PFAS,  and specifically PFOS, in its wastewater stream, Young, the DEQ spokeswoman, said in her email.

“More data is necessary to determine why that single sample result was significantly higher than the previous months which is why additional sampling has been initiated,” Young wrote.

No action against Burlington

The DEQ has not taken action against Burlington, where monitoring data show the sum of PFOA and PFOS spiked to 121 parts per trillion in August. The DEQ said dilution kept the levels found at the East Burlington sewer plant from exceeding the EPA health advisory. It did not comment on total PFAS being found at nearly 2,296 parts per trillion at the plant, presumably because that combination of chemicals does not have a health advisory.

Burlington is feeling the heat from elsewhere, though.

On Nov. 7, the Southern Environmental Law Center filed a notice of intent to sue Burlington over PFAS contamination on behalf of the Haw River Assembly, an environmental advocacy group. The notice accuses the city of violating the Clean Water Act and the Resource Conservation and Recovery Act.

“Burlington’s wastewater treatment plants are illegally releasing toxic chemicals from their wastewater and their sludge into the Haw River and its tributaries,” the SELC writes in its notice. “They will continue to do so unless the waste that they are receiving from industrial facilities no longer contains these chemicals or adequate pollution control technology is installed at the treatment plants.”

The SELC intends to file suit against Burlington unless the city can demonstrate that appropriate steps are being taken to stop the pollution.

Kelly Moser, a senior attorney for the SELC, called the level of PFAS and other contaminants contained in the DEQ’s new data “staggering.”

“The burden should not be on downstream users and the people drinking the water,” Moser said. “DEQ has to get ahead of it and start making headway to solve this problem.”

****

In its public release of the new data, the DEQ highlighted the positive. It acknowledged the high levels of PFOS contamination found in Sanford but said test results for the other 24 wastewater treatment plants showed concentrations of PFOA and PFOS that would not exceed the EPA health advisories. The DEQ made no mention of the high concentration of the other types of PFAS found.

The DEQ also confirmed that industrial discharges of 1,4 dioxane flowing into the wastewater treatment plants serving Greensboro, Reidsville and Asheboro are a primary concern. That fact was established four years ago when the DEQ prepared a study on the chemical in the basin.

In its release, the DEQ noted that test results for the other 22 sewer plants in the monitoring program were not anticipated to cause levels of 1,4 dioxane to exceed the EPA’s health advisory of 35 parts per billion in drinking water.

When the water at the Sanford water plant in September, it had high rates of PFAS
The highest level of total PFAS detected was in Sanford, which recorded a concentration of 4,026 parts per trillion in September. Photo credit: Greg Barnes

But there is no mention of the cumulative effects of PFAS on the environment or on human health.

Moser, the SELC attorney, said PFAS are additive, meaning they don’t break down easily and accumulate in the environment and in the human body. That’s why they are called “forever chemicals.” Almost everyone in the United States has some level of PFAS in their bloodstream.

At the East Burlington plant, the level of total PFAS measured 1,991 parts per trillion in July and 2,296 in August. By September, the level had fallen to just 18 parts per trillion, according to the DEQ data.

In Sanford, the total PFAS levels went from 258 parts per trillion in July to 283 parts per trillion in August to 4,026 in September.

****

It is not clear why the levels of PFAS and 1,4 dioxane fluctuate so much. One reason, researchers believe, is streamflow. The lower the flow, the more likely it becomes that contaminants will be detected at high levels.

Another reason appears to be industrial discharges. The DEQ has required Greensboro, Reidsville and Asheboro to monitor for 1,4 dioxane at their wastewater treatment plants since December 2017.

From then through mid-October of 2019, monthly testing found the levels of 1,4 dioxane exceeded the EPA’s health advisory for drinking water 21 of 23 times at the Asheboro sewer plant, 20 of 27 times at the Reidsville plant, and eight of 27 times at the Greensboro plant.

The DEQ didn’t penalize any city for violating their wastewater pretreatment permits until November of last year when Greensboro and Reidsville received notices of violations.

It was disclosed a month earlier that a Greensboro company, Shamrock Environmental Corp., was responsible for a large discharge of 1,4 dioxane in August. In Reidsville, officials provided the names of two companies, Unifi Inc., and DyStar, that may have been responsible for a large release of 1,4 dioxane in June.

Young said in her email that the monitoring program is the initial stage of a management strategy to determine which sewer plants are receiving PFAS compounds.

“So the primary goal is to identify the need for reduction measures and implement those,” Young wrote. “The violations in Greensboro and Reidsville were based on a much longer timeline of monitoring data and reduction efforts.”

Industries starting to respond

The DEQ says industries are getting the message, and levels of contamination are decreasing.

DEQ spokeswoman Sharon Martin said the discharge levels of 1,4 dioxane in Reidsville “are consistently dropping… though the city has not provided an explanation on why.”

Martin said that Greensboro’s results have remained below the EPA’s health advisory for 1,4 dioxane and that the city “has indicated Shamrock is expected to install treatment in the next few months.”

Young, the other DEQ spokeswoman, said the StarPet company in Asheboro expects to complete installation of treatment technology early this year to reduce 1,4 dioxane discharges.

StarPet has been saying that at least since June 2018, when company spokesman Jason Greenwood told a reporter that getting the discharges of 1,4 dioxane to acceptable levels “is of the highest priority.”

Greenwood said then that the company was working on new technology to solve the problem.

Andrews, the Environmental Working Group scientist, and Moser, the SELC attorney, said the burden should be on industries to stop polluting and start paying for the cleanup of PFAS contamination, not the utilities or state taxpayers.

“The wastewater facilities are not the enemies in this case,” Andrews said. “They are the ones that are trying to deal with an upstream problem.”

How we reported this story:

In September, the Cape Fear Public Utility Authority in Wilmington recorded a spike in its drinking water of the likely carcinogen 1,4 dioxane.

Shortly afterward, Greg Barnes, the environmental health reporter for NC Health News, began to trace where the chemical originated and who might be responsible for its release.

The path led to Greensboro, where state monitoring records showed a discharge of 1,4 dioxane in August that measured 957 parts per billion at the city’s wastewater treatment plant. The discharge caused a temporary spike of the contaminant downstream in Pittsboro’s drinking water that measured 107 parts per billion, more than three times the U.S. Environmental Protection Agency’s health advisory.

Initially, Greensboro officials refused to identify the company responsible, and the state Department of Environmental Quality said it didn’t know. The day after NC Health News published its story, the DEQ said Greensboro’s Shamrock Environmental Corp. was responsible for the discharge.

About a week later, the DEQ announced that another large discharge of 1,4 dioxane had occurred, this time in Reidsville. For the first time, the DEQ cited both Reidsville and Greensboro for violating their wastewater pretreatment program permits.

Meanwhile, the DEQ in May announced that it was requiring 25 utilities in the Cape Fear River basin to test for 1,4 dioxane and PFAS at their sewage treatment plants. The utilities tested monthly for the contaminants from July 1 to Sept. 30.

The DEQ made that data public this month. This story uses the data to examine the high level of contaminants found in the basin and their potential consequences.

shows a building entrance to Randolph Health facility. The general assembly threw a lifeline to the financially strugglig Randolph hospital this week.

Legislature comes and goes, leaves most health care priorities unfinished

by

Legislature comes and goes, leaves most health care priorities unfinished - North Carolina Health News

One significant bill did get done, which will allows for a bailout of Randolph hospital in Asheboro.

By Rose Hoban

County and health officials in Asheboro will likely breathe a sigh of relief this weekend as a long-desired bill to help the county hospital, which has been in financial trouble in recent years, passed both chambers of the General Assembly and is headed to Gov. Roy Cooper for his signature.

Language from the Rural Health Care Stabilization Act, which was introduced earlier this year by Senate leader Phil Berger (R-Eden) and Randolph County Sen. Jerry Tillman (R-Archdale), had been added to multiple bills this legislative session, looking for a vehicle for passage. The measure finally crossed the legislative finish line tacked onto a catchall bill that had dealt largely with health care licensure, compliance and credentialing.

Related: Legislators offer lifeline to rural hospitals drowning in debt

Senate Bill 537 emerged from a committee on Wednesday significantly altered to include the bill language, which would allow for troubled hospitals to borrow up to $20 million from the state. The funds could then be used to shore up finances as hospitals construct new facilities, for operational costs during a transition to a new facility, or both.

Right now, the only hospital in the state looking for such an infusion of cash is the 145-bed Randolph Health flagship hospital in Asheboro, first constructed during the Depression and updated over the years. The hospital has 1,129 employees and is the county’s fourth largest employer.

A man stands at a podium talking, others stand behind him, he's discussion the state budget and Medicaid expansion. One item on Berger's agenda, helping rural hpspitals like Randolph hospital, was passed before the General Assembley adjorned.
NC Senate leader Phil Berger at a press conference earlier this month to discuss the rest of this year’s legislative session. Photo credit: Rose Hoban

According to a county bond issue filing, “Randolph Health, like many other rural hospitals, is experiencing financial challenges as an independent entity. It is exploring other opportunities to improve its financial condition, including the possibility of joining a larger health network.”

Hospital leaders had looked to merge with Greensboro-based Cone Health, but in 2018, Cone called off negotiations.

“I’m thrilled to death,” said Rep. Pat Hurley (R-Asheboro) “Couldn’t be happier to put my county in debt.”

“Praise the Lord, the hospital does have a chance.”

Solution needed ‘very, very soon’

SB 537 doesn’t provide the actual funding to Randolph Hospital, it only creates the mechanism for making the loan. Hurley said that since the legislation has now passed, it will allow the hospital to start the application process to the state.

“They’re going to have to go into bankruptcy, and this is part of the strategic plan for them,” she said.

As in many hospitals, Randolph has a high number of patients on Medicaid and Medicare, which pay less than commercial insurance. According to 2017 (the most recent available) financial statements, the hospital had more than half its revenue from the two public programs, and at least seven percent of expenses were for patients who had no means of payment.

Hurley said the Randolph Health CEO, Angela Orth, has steadied the hospital’s finances and the organization is currently operating in the black. She also said the hospital continues to look for another organization to partner with or buy the system outright.

But she declined to say who the hospital has been talking with. Orth told High Point news station MyFox8 that “We really need a solution very, very soon.”

Any loan application would be reviewed and approved by UNC Health Care, acting in concert with the state.

The actual money for the hospital is tucked into another bill that deals with relief from recent hurricanes, House Speaker Tim Moore (R-Kings Mountain) said.

Adult care home, NCFAST plans in bill

Other provisions in the 55-page bill also call for a study due late next year of how the legislature can address long-standing problems with the financing of adult care homes.

The facilities, which frequently house adults with mental health and developmental disabilities, have had cash flow issues since the legislature changed the way the state pays for Medicaid personal care services in 2012. Since that time, the state has provided “bridge funding” in every biennial budget.

The final bill also contained provisions to delay the rollout of the child welfare component of NCFAST, the information technology system used by county social service departments to determine eligibility for many entitlement programs.

Problems with the software were raised during a legislative hearing in March. Since then, DHHS and counties that have been piloting the software have been working with IBM to redesign the system. Legislators decided to forge ahead with improving the program, rather than scrapping it and purchasing an off-the-shelf solution because the state would have been on the hook to repay the federal government some $50 million that North Carolina received in support.

Another provision in the bill adds a requirement for criminal background checks on child care workers working in child care group homes and other child welfare institutions.

Medicaid expansion stalemate persists 

In the confounding and often tumultuous tail end of the legislative session, bill language gets tucked into other bills or bills get sent to a conference committee where they emerge looking sometimes radically different.

“You could have a conference report that deals with one bill and the original bill did and you can adopt a conference report that has an entirely different subject matter,” Moore said.

For example, one bill contained an attempt to add a tax to e-cigarette and vaping products.

Rep. Cynthia Ball, a Wake County Democrat, was able to get the proposal through a House finance committee meeting.

a man stands up with a microphone on the floor of the legislature. Some people listen, but many are ignoring him.
House minority leader Rep. Darren Jackson argued that the legislature should not adjourn before voting to expand the Medicaid program. Photo credit: Rose Hoban

But the new tax was snuffed out quickly and excluded from a bill later adopted by the House and Senate.

Other health care bills shared similar fates or were not heard at all. Included in that group is the so-called “mini-budget” that addresses financing for the Medicaid managed care transformation that’s slated to start early next year. A lack of funding leaves the timing of the policy change in doubt.

Moore said that he’s told Rep. Donny Lambeth (R-Winston-Salem) that any time he wants a vote on Lambeth’s bill to expand the Medicaid program to low-income workers, he can have it.

But, according to Moore, Lambeth is working to find a way for the bill to be palatable to the Senate.

“Instead of just trying to send something over (to the Senate), it’s been more like trying to work and see if he can come up with something that actually passes,” Moore said.

The adjournment resolution passed by both chambers stipulates the legislature will return in mid-November to deal with redistricting issues and then again in January to possibly take up expansion and other health care issues.

But as the House prepared to vote on the adjournment resolution, minority leader Darren Jackson (D-Raleigh) got up to object to the delay on Medicaid expansion.

“Thirty-seven states have already taken action to expand their Medicaid program. I believe that North Carolina should be the next one,” he said. “It would help a half a million people get access to affordable health care … over 500,000 working people that are one illness, one major injury away from bankruptcy.

“In every county, in every district of this state, there’s someone who would benefit and who would be harmed by waiting an additional two months.”

NC Health News Reporter Anne Blythe contributed to this report.

glass of water to signify contaminated drinking water. There's little being done about 1,4 dioxane in the Cape Fear River Basin

Little progress being made in the fight against 1,4 dioxane

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Little progress being made in the fight against 1,4 dioxane - North Carolina Health News

At least four years after high concentrations of 1,4 dioxane were discovered in the Cape Fear River basin, contamination persists and little apparently is being done to stop it.

By Greg Barnes

Five years ago, N.C. State researcher Detlef Knappe and his graduate students set out to measure the probable carcinogen 1,4 dioxane in the Cape Fear River basin as part of a study for the state Department of Environmental Quality.

For two years, Knappe and his students took samples in the Haw and Cape Fear rivers, as well as from creeks and streams in the state’s largest basin.

At one spot along the Haw River, at Troxler Mill Road near Reidsville, Knappe’s group measured 1,4 dioxane at what seemed at the time to be an astonishingly high level: 1,030 parts per billion.

High levels of 1,4 dioxane reported in additional communities

The state Department of Environmental Quality provided a list of 15 governing bodies or their water utilities that it said it notified Tuesday of high levels of 1,4 dioxane detected at Reidsville’s wastewater treatment plant. A source of the contamination is not yet known. The levels detected in samples taken Oct. 11 are 4,000 times higher than the state’s health advisory for surface waters used for public consumption.

  • Fayetteville Public Works Commission
  • Cape Fear Public Utility Authority
  • Greensboro
  • Pittsboro
  • Reidsville
  • Asheboro
  • Brunswick County
  • Harnett County
  • Sanford
  • Piedmont Triad Regional Water Authority
  • Dunn
  • Raleigh
  • Chatham County
  • Lower Cape Fear Water and Sewer Authority
  • Cary

That’s more than 2,900 times higher than North Carolina’s lifetime health advisory for surface waters used for drinking water. High levels were also detected in many other parts of the watershed, which Knappe says probably has the highest levels of 1,4 dioxane in the country.

The study concluded that there were four primary areas of elevated 1,4 dioxane in the basin, three of which are immediately downstream of wastewater treatment plants in Greensboro, Asheboro and Reidsville. The study also concluded that the likely sources of the contamination are industries in those three cities.

Flash forward to August of this year, when a sample taken at Greensboro’s wastewater treatment plant measured 1,4 dioxane at a concentration of 957 parts per billion. Scroll forward again to this month, when another sample, taken at Reidsville’s wastewater treatment plant, detected 1,4 dioxane at 1,400 parts per billion. That’s 4,000 times higher than the state’s health guideline.

The fight continues

Environmental advocates and leaders of water utilities downstream of those three wastewater treatment plants have been fighting for years for tougher enforcement actions against the responsible industries.

“It’s troubling that the DEQ and the municipalities involved have not been able to remove 1,4 dioxane down to a level that’s unquestionably safe for downstream water users even though they have been aware of the problem for years,” Mick Noland wrote in an email to NC Health News on Wednesday. Noland is the chief operations officer for the Fayetteville Public Works Commission’s Water Resources Division.

Kemp Burdette, head of the advocacy group Cape Fear River Watch in Wilmington, had an even stronger response.

“It’s time to move past studies and on to action,” Burdette said in an email. “Our legislative leaders need to empower DEQ to stop these discharges at the source — now.”

The DEQ taking action

Lately, the DEQ has been responding to the problem.

In May, it began requiring 25 municipalities in the basin with industrial pretreatment programs to begin sampling for 1,4 dioxane and perfluorinated compounds — known as PFAS or “forever chemicals” — as a way for cities to determine which industries are responsible for the pollution and to make them stop.

shows two men kneeling at a spigot, dressed in safety vests and gloves, gettting a water sample from a faucet
Workers from the state Dept. of Environmental Quality take water samples for testing. Photo courtesy: NC DEQ

The sampling began in July and ended in September. Although the DEQ said the test results aren’t yet available — the municipalities have until Oct. 31 to turn them in — it credits the monitoring program with revealing the latest discharges.

But that raises a question: How often were these discharges occurring before the monitoring program began?

If the discharge in Reidsville reaches Wilmington, it will be the fifth time this year that the Cape Fear Public Utilities Authority has detected a spike in 1,4 dioxane. It is not known whether other discharges may have gone undetected.

No easy fix

Officials with Greensboro, Asheboro and Reidsville all say they have been working hard with the industries to stop the releases of 1,4 dioxane and PFAS. But they also say there is no easy fix.

The contaminant is not federally regulated, so there is no law to get industries to stop the discharges. The way it stands now, the only real enforcement action the state can take is against the cities, which issue industrial pretreatment program permits to the industries.

It’s up to the cities to control the polluters and downstream utilities. Environmental advocates say the cities, and the DEQ, are not doing enough.

Related: DEQ requires municipalities to test for PFAS, 1,4 dioxane in Cape Fear River basin

“North Carolina needs to stop putting financial success of the manufacturing industry ahead of human and environmental health,” Burdette said. “They need to require, by law, that industries prove their discharge is safe before it enters the environment. We have waited long enough.”

Cities not cooperating

Noland and others say cities where the discharges have happened are being less than cooperative.

Until now, there has been no initiative on the part of the state or cities to contact downstream utilities immediately after learning of a discharge.

Emily Sutton, the Haw River riverkeeper, believes the DEQ began notifying downstream utilities immediately after the Reidsville discharge because of the pressure it felt after the Greensboro discharge, which presumably occurred in early August.

But in fairness to the DEQ, Greensboro did not notify state regulators until more than a month after it had learned of the discharge and may have done so then only because it was required to under federal permitting regulations. The DEQ says the discharge had dissipated by the time state regulators learned of it on Sept. 27.

Refusal to reveal company

After notifying the state, Greensboro refused a request from N.C. Health News to identify the company responsible for the discharge, saying city policy pertaining to billing of water customers prevented it from doing so.

The DEQ revealed the responsible industry — Shamrock Environmental Corp. — a day after N.C. Health News published a story saying the company’s identity remained a secret.

shows low level satellite photo of a dam feeding into a river, surrounded by trees, 1,4 dioxane
The Cape Fear River winds over 200 miles through central and eastern North Carolina. It is a source of water for industry and public drinking water systems and in the summer of 2016, it was found to contain the chemical contaminant GenX. This aerial view captures Lock and Dam No. above Wilmington. Image courtesy U.S. Army Corps of Engineers.

Documents provided by the DEQ show that Shamrock was cited numerous times last year for exceeding discharge allowances for zinc, copper, pH, cyanide and cobalt. Despite those infractions, Sharon Martin, a DEQ spokeswoman, said Greensboro does not list the company as being in “significant noncompliance.”

The documents do not show whether the company had been monitored for releases of 1,4 dioxane, possibly because that may not have been a requirement at the time, Martin said.

The DEQ continues to investigate and is considering enforcement action against Greensboro.

The situation in Reidsville

The DEQ said it does not know who might be responsible for the release of 1,4 dioxane detected at Reidsville’s wastewater treatment plant. It said Reidsville provided the names of two possible candidates, Unifi Inc. and DyStar. Representatives from those companies did not return phone messages Wednesday.

Besides not being notified of contamination, downstream water utility leaders have also been rankled by the DEQ’s enforcement efforts.

Last year, the DEQ prepared a draft permit for the city of Asheboro that included a stipulation that it could release a concentration of no more than 149 parts per billion of 1,4 dioxane from its wastewater treatment plant.

Noland and other downstream utility leaders strongly objected to the 149 parts per billion provision, saying it was way too high to adequately protect their water customers. Sutton, the Haw River riverkeeper, said she was told that the figure is based on a dilution factor of the effluent coming from the Asheboro treatment plant.

A year later, the draft permit is still pending as the DEQ staff reviews the 1,4 dioxane limit and the best available technology for removing the chemical, according to Martin, the DEQ spokeswoman. Greensboro, Asheboro and Reidsville are all operating under expired pollution discharge permits.

Hold industry accountable

Sutton said industry — not households or water utilities — should be responsible for removing 1,4 dioxane and PFAS from their plants before it gets into drinking water supplies and sewer treatment facilities. Utilities cannot remove the chemical without spending millions of dollars on special filtration systems. Instead, homeowners are now paying hundreds of dollars of their own money for in-home systems. Sutton called that an environmental injustice, especially because not every customer can afford the often pricey filtration systems.

A lesser-known issue, Sutton said, is the sludge collected from the sewer plants that is spread on farm fields or used as compost. Erosion and heavy rainfall often cause 1,4 dioxane in the sludge to run off the fields into the rivers, creeks and streams, she said.

“The Cape Fear River basin should not be treated as a dumping ground for industrial chemicals,” Erin Carey of the Sierra Club said in an email. “It’s a source of drinking water for thousands as well as an important recreational resource for fishing and boating.

“First GenX, now 1-4 dioxane, what next? After years of cuts, it’s past time to adequately fund DEQ’s environmental enforcement capability and hold polluters accountable. The age of protecting/prioritizing industry interests over human health and natural resources needs to end.”

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