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CAROLINA JOURNAL North Carolina C a R O L I N a Wakemed Forced to Compete with Government

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CAROLINA JOURNAL North Carolina C a R O L I N a Wakemed Forced to Compete with Government INSIDE THIS ISSUE: DEPARTMENTS WakeMed North Carolina 2 C A R O L I N A Education 6 forced to Local Government 10 From Page 1 14 compete Higher Education 17 with govern- Books & the Arts 20 Opinion 24 ment/2 A MONTHLY JOURNAL OF NEWS, ANALYSIS AND OPINION Parting Shot 28 JOURNALFROM THE JOHN LOCKE FOUNDATION November 2011 Vol. 20 No. 11 STATEWIDE EDITION Check us out online at carolinajournal.com and johnlocke.org Parton Theatre Still Haunts Roanoke Rapids ity study said. They didn’t give us any of the negatives,” Jim Garrett, a local City struggles with businessman who initially supported the project, told CJ. He said he be- debt from failed lieves the current value of the theater is $5 million to entertainment project $7 million, and said that if the By DoN CarriNgtoN city gets an offer Executive Editor it should take it. ROANOKE RAPIDS The Randy ounty singer Dolly Parton Parton Theatre joined her lesser-known brother was to be the Randy Parton on Nov. 11, 2005, anchor tenant of Cin Roanoke Rapids at a groundbreak- Carolina Cross- ing ceremony for a city-owned music roads, a 1,000- Roanoke Rapids theater that would bear his name. businessman acre entertain- Jim Garrett Thousands of citizens and sev- ment and retail eral government officials attended development, with Randy Parton as the event. Project supporters said the theater manager. While Randy Par- Randy Parton Theatre would make ton’s band played regularly, Parton Roanoke Rapids a significant tourist Dolly Parton, in orange dress, and her brother Randy, next to her in leather jacket, didn’t book other acts to perform, and destination. It didn’t — and six years joined Roanoke Rapids officials and theater project supporters for a groundbreaking attendance plummeted. As revenues later, the project remains a nightmare. on Nov. 11, 2005. (CJ photo by Don Carrington) fell, the city fired Parton and saw the It took less than two years for derwritten by a North Carolina munic- borrowed $21.5 million to build the facility decline. the Randy Parton Theatre to become a ipality using Tax Increment Financing. 35,000-square-foot, 1,500-seat theater. Randy Parton’s contract with the white elephant, and its demise offers a Under TIF, a public economic But when the project failed, Roanoke city called for Roanoke Rapids to pay cautionary lesson to cities that pay for development investment is supposed Rapids was left with a debt to retire him up to $1.5 million per year as an economic development projects using to improve the values of surrounding and little revenue to do so. “artist fee” to manage the theater, over untested financial vehicles. property; the incremental increase in “In the beginning, city officials and above all other expenses. In addi- The $21.5 million project was the property tax collections is then used gave us a bunch of false information. first major economic development un- to repay the borrowed money. The city They didn’t tell us what the feasibil- Continued as “Parton,” Page 14 ‘Occupy Raleigh’ Protests Cost Taxpayers $50K PAID By DaviD N. Bass as well, among them forgiveness of all RALEIGH, NC U.S. POSTAGE PERMIT NO. 1766 Associate Editor NONPROFIT ORG. debt, devoting $1 trillion to “ecological RALEIGH restoration” of the country, and erasing all it a pricey camping trip national borders so that anyone can funded by local taxpayers: The immigrate to the United States. city of Raleigh spent nearly In Raleigh, city government C$50,000 through the end of October to spent $26,300 for additional police pro- police anti-Wall Street demonstrators tection during a kickoff rally the week- bivouacked downtown. end of Oct. 15, according to estimates Mirroring a larger protest in New from the Raleigh Police Department. York City’s financial district, members Since then, the additional tab for polic- of Occupy Raleigh established camp on ing protesters lined up on the sidewalk the sidewalk near the Capitol grounds Occupy Raleigh protesters carried signs near the Capitol grounds has been $1,500 per day. in mid-October and hadn’t budged as and wore masks at a “general assembly” The public costs aren’t confined of press time. Similar “camp-ins” have at Moore Square downtown on Oct. 9. (CJ photo by David N. Bass) to the Tar Heel State. Occupy Seattle cropped up in cities across North Caro- already has cost the city an estimated lina and the nation. tion to corporate bailouts, greed, and Officially launched Sept. 17, Oc- income inequality. Participants have The John Locke Foundation 200 W. Morgan St., #200 Raleigh, NC 27601 cupy Wall Street is built on opposi- embraced a number of unofficial aims Continued as “Occupy,” Page 15 PAGE 2 OCTOBER 2011 | CAROLINA JOURNAL North CaroliNa C A R O L I N A WakeMed Forced to Compete With Government By sara Burrows — who previously performed heart procedures at multiple JOURNAL Associate Editor hospitals — to work exclusively at Rex. Rick Henderson RALEIGH In the certificate-of-need application, Rex officials stat- Managing Editor akeMed Health and Hospitals CEO Bill Atkinson ed that they intended to shift 100 percent of patients treated said he doesn’t mind competition, except when by the group of physicians — Wake Heart and Vascular — Don Carrington he’s competing against the government. And he from WakeMed Raleigh, WakeMed Cary, and Duke to Rex. Executive Editor Wfeels like that’s exactly what he’s doing with Rex Health- Schiller said the physicians didn’t sign on with Rex care. for bigger paychecks. “They chose to affiliate with Rex and David N. Bass, Sara Burrows “We don’t mind competition as long as it’s a level UNC on their own accord.” Mitch Kokai, Michael Lowrey playing field,” he said. “When you’re competing against the “These physicians are working with us because they Associate Editors government it’s not a level playing field.” liked our vision for what the future of vascular care would Rex was a private hospital until UNC Health Care Sys- look like in our area,” she said. “We did not purchase their Jana Benscoter, Kristy Bailey tem purchased it in 2000. And it recently acquired a “certifi- assets. They made the decision on their own accord.” Kristen Blair, Roy Cordato cate of need” to build a state-of-the-art heart center in Wake “It has nothing to do with vision,” DeVaughn said. “It Becki Gray, Sam A. Hieb County. Rex is recruiting heart doctors from WakeMed Ra- has to do with cash. Those physicians aren’t joining out of Lindalyn Kakadelis, George Leef the goodness of their hearts; they’re joining this network Karen McMahan, Donna Martinez leigh, WakeMed Cary, and the Duke University Health Sys- tem to work at the new cardiac facility. because there’s financial opportunity there. These practices Karen Palasek, Marc Rotterman are being purchased. They are becoming employees of Rex.” Michael Sanera, Tara Servatius WakeMed was Wake County’s public hospital from its George Stephens, Jeff Taylor founding in 1961 until 1997, when it shifted to ownership More Medicaid money Michael Walden, Dan Way by a private, nonprofit foundation. It has been the primary Karen Welsh, Hal Young provider of cardiovascular services in Wake County. Atkin- In addition to job security, help with regulatory com- John Calvin Young son worries that Rex’s new heart pliance, and possibly higher pay- Contributors center could change that. Competi- checks, working for Rex has an- tion from Rex could erode the most other bonus. profitable aspects of WakeMed’s The government typically re- Ziyi Mai operations, and the loss of those imburses private-practice doctors Daniel Simpson profits could force WakeMed to cut only about 60 to 70 percent of their Alissa Whately back on health services it provides cost of treating Medicaid patients. Interns to the indigent. But a recent amendment to the Lisa Schiller, Rex’s vice presi- state Medicaid plan allows doctors affiliated with the UNC Health dent of marketing and public rela- Published by Care System (including Rex) to get tions, denies the heart center’s goal The John Locke Foundation reimbursed at a higher, managed- is to increase Rex’s market share in 200 W. Morgan St., # 200 care level. Raleigh, N.C. 27601 cardiac services. She says the new “There’s not a physician in (919) 828-3876 • Fax: 821-5117 facility is meant only to accom- this state who would not clamor www.JohnLocke.org modate anticipated population to get compensated at managed- growth. care rates for treating Medicaid pa- Jon Ham The battle over the certificate of need for the cardiac Vice President & Publisher tients,” DeVaughn said. center is but a small part of what is becoming a nasty public Rex doesn’t yet get full reimbursement for Medicaid fight over the provision of medical services in North Caro- John Hood costs, but it could if the federal government approves a lina’s second-largest county. Chairman & President second amendment to the state Medicaid plan. The amend- Certificate of need ment would give Rex full reimbursement for treating the Bruce Babcock, Herb Berkowitz uninsured. Currently, Rex gets an annual state appropria- Charlie Carter, Jim Fulghum North Carolina is one of 36 states with a certificate- tion — ranging in recent years from $18 million to $40 mil- Chuck Fuller, Bill Graham of-need law, which forces hospitals to obtain a “determina- lion — to help cover the cost of indigent care. Robert Luddy, Assad Meymandi tion of need” from state health officials (in this case, from WakeMed and other nongovernment hospitals are re- Baker A.
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