Calls mount for NC attorney general to review ‘rushed’ WakeMed-Atrium merger

Three weeks after a divided Wake County Board of Commissioners gave its approval for Atrium Health to merge with WakeMed, a coalition of health advocates, state employees and nonprofit groups says there are far too many unanswered questions.

Wednesday’s news conference took place just hours before state Treasurer Brad Briner announced most Atrium facilities will no longer be in-network for State Health Plan members in 2027. It’s unclear what that might mean for state employees who rely on WakeMed for healthcare.

The group formally urged Attorney General Jeff Jackson to open and pursue a rigorous investigation of the deal and its impact on patients and taxpayers.

“There was no open competitive bidding process and the public had little opportunity to examine the full terms,” said Jamila Headley, executive director of nonprofit advocacy group Patients Union. “Patients had to fight to just learn what was being proposed and who it would serve.”

She said details of Atrium’s agreement to invest $2 billion of its own assets in WakeMed have not been put in writing.

Headley said a steady drumbeat of public pressure forced changes to the level of charity care Atrium offered, and a five-year price cap negotiated by Gov. Josh Stein before the commissioners’ vote generated new questions the county attorney could not answer. Commissioners had to vote on the deal without seeing the final version of it.

Nathan Foster, a health policy specialist at the N.C. Justice Center, said the deal gives away 60 years of public investment to one of the largest and most expensive healthcare corporations in the country. WakeMed no longer receives public funding from the county, but did for much of its history.

“This deal gives away meaningful local control of WakeMed to Atrium executives in Charlotte and Chicago,” said Foster. “One of Atrium’s powers will be to fire WakeMed’s CEO at will. What kind of local control can there be when an outside party can fire the CEO of an organization?”

Foster said the attorney general should also be very worried that one of the known provisions states that if WakeMed shuts down at some point in the future, its assets will automatically transfer to Atrium.

Members of the Patients Union, the State Employees Association of North Carolina, the NC Justice Center, Raleigh-Apex NAACP, the NC Poor People’s Campaign and others want the attorney general to make the final enforceable language of the documents  public  and to conduct an  independent assessment of the impact of the merger on prices and patient access.

Wake County Commissioner Tara Waters, one of the two commissioners to vote against the merger in September, told NC Newsline she still had not seen the wording in the documents they voted on weeks earlier.

“Interestingly enough, I just got a call just before we came here that the documents have been completed, but I have not seen them,” Waters said. “I welcome the attorney general’s scrutiny over the process, over the competitiveness, over every phase.”

By law the North Carolina Department of Justice is required to review the agreement negotiated by Atrium, WakeMed, and the Governor’s Office and approved by the Board of Commissioners to make sure that it complies with the law.

“We’ll begin that work when we receive official notice and all documents from the parties – that has not happened yet,” said Nazneen Ahmed, communications director for Jackson.

Briner moves Atrium out of network

In the meantime, the State Health Plan announced Wednesday that beginning Jan. 1, most Atrium Health facilities will move to the costlier out-of-network tier.

Briner, whose office oversees the State Health Plan, and Atrium have been battling for weeks over the State Health Plan’s new tiered provider system. Atrium was not named a “preferred” provider, so care at most of its facilities would come with higher out-of-pocket costs to incentivize members to seek care elsewhere.

Atrium rolled out a new Atrium “Affordability Protection Program” it said would address the “affordability gap” created by the higher copays. It would essentially cover most out-of-pocket costs for state employees. But the insurer would still bill the State Health Plan for more than other providers do.

Briner sued to block the program, saying it could potentially push the Plan into bankruptcy, but a Wake County judge Tuesday declined to issue a temporary restraining order.

Briner said Wednesday the State Health Plan would hold Atrium to its word of ensuring “members can continue receiving care from Atrium Health at the lowest cost-sharing available under the State Health Plan.”

NC’s State Health Plan moves to block Atrium program it calls an ‘unlawful pricing scheme’

“One of my duties is to keep the State Health Plan financially solvent so it can continue as an incentive for teachers and state employees,” said Briner. “I will not let one hospital system destroy the Plan, raise premiums on every teacher and state employee and send us into overwhelming debt.”

Briner has also invited the state’s attorney general to conduct a thorough, independent assessment of the Atrium-WakeMed merger. He spoke out against the deal a day after Wake County commissioners voted to approve it.

“I’m hopeful that federal regulators will step in to consider how cross-market mergers like this one harm competition,” said Briner in September.

The executive administrator for the NC State Health Plan has estimated if the merger goes through and WakeMed’s rates rise to Atrium’s current levels, premiums could increase by $84 to $132 per year for each policyholder in the state plan.

Atrium did not immediately respond to NC Newsline’s request for comment.

Editor’s note: This story was updated Oct. 14 to include a response from the North Carolina Department of Justice.