News: Quick Takes

Senate makes another attempt to prop up rural hospitals

As the General Assembly scrambles to adjourn, the Senate made another stab at getting money to failing rural hospitals. 

Senate Bill 537 would create a rural hospital loan program, which would lend $20 million in taxpayer dollars to distressed rural hospitals. University of North Carolina Health Care and the N.C. Local Government Commission would administer the loan program. 

The Senate rolled the loan program into a more comprehensive mini-budget that included social services reform and revisions to the Substance Abuse Professional Practice Act. The bill passed the Senate, 49-1, Wednesday, Oct. 30, and was placed on the House calendar for Thursday. 

“It establishes a loan program to help our local rural health care entities that may get into trouble,” Sen. Joyce Krawiec, R-Forsyth, said. “We passed it out of this body with great support.”

S.B. 537 would help fund distressed rural hospitals that needed to build new facilities or move to a new facility. To qualify for the loan, the hospital must give UNC Health Care its plan to recover financially. 

The Senate had passed similar language twice before, but previous incarnations of the rural loan program sunk in the Senate after the House tacked on other legislation to the loan program. 

“It went over to the House as a straight bill to assist rural hospitals in trouble, Randolph Health being one of the deepest trouble of any of them, certainly most near bankruptcy,” Sen. Jerry Tillman, R-Randolph, said. “That bill came back with a lot of other stuff in it.”

Randolph Health, a distressed hospital in Asheboro, is expected to be the first to receive such a loan. 

“We’re trying to resurrect part of [the loan program] in this bill that Senator Kraweic has brought forward to salvage a hospital that is on the brink of bankruptcy,” Tillman said. 

Sen. Dan Blue, D-Wake, questioned where the money for the loan program would come from. Krawiec said the money would be established in a separate bill. 

Debate fell into the usual squabbling over Medicaid expansion. As Republicans pushed the loan program, Democrats argued the program was only needed because Republicans refused to expand Medicaid. 

In North Carolina, six rural hospitals have closed since 2010, according to the Cecil Sheps Center