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It's time to update NCGS 131.E: North Carolina's 'Hospital Authority' enabling legislation

NC GS 131.E

Joe Vincoli <joevincoli@gmail.com>

 

Sun, Feb 16, 5:22 PM (8 days ago)

to dana.jones

Senator Jones,

 

Thank you for reaching out.

 

I would like to meet with you to discuss legislation to update NC GS 131.E.

 

NC GS 131.E was passed in the 1940s and allowed counties to create 'hospital authorities'.

 

You may have noticed a plaque on the hallway at Forsyth commemorating when Forsyth transitioned from a 'hospital authority' to a 501(c)3.

 

As a result of that transition, employees of Forsyth Memorial (now Novant) went from having their health and retirement benefit plans protected by the oversight of a self-perpetuating private board to having legal protections under federal law (ERISA, 1974).

 

Ninety miles to the south, the Charlotte-Mecklenburg Hospital Authority never made that transition.

 

As a result, their employees are not protected by ERISA. They, in contrast, are protected by the oversight of a self-perpetuating private board.

 

Clearly, hospitals (as medical providers to their employees) have, at least, the appearance of a 'conflict of interest' when it comes to selecting the health benefit plan to be made available to the employees.

 

Does the board choose a plan that pays the hospital the highest reimbursement rates of all the plans? Or, does it choose a plan that pays it the lowest reimbursement rates of all the plan but saves its employees the most money?

 

NC GS 131.E allows private, self-perpetuating, hospital boards make that decision in secret.

 

That is not right.

 

I have ideas on legislative proposals that would fix the problem and I would love to meet with you to discuss them.

 

I live in Clemmons and am a retired hospital/managed care/Medicaid/Department of Public Safety employee.

 

Thank you,

 

Joe Vincoli

220 Epping Road

Clemmons, NC 27012

I will update this site when I hear from Senator Jones.

Re: NC GS 131.E

Inbox

Cheryl Kakouras (Sen. Dana Jones) <Cheryl.Kakouras@ncleg.gov>

 

Thu, Feb 20, 11:17 AM (4 days ago)

to me

Hi Joe,

 

Thank you so for reaching out. Senator Jones is very interested in talking with you. Are you available for a meeting on February 28th at 12:30pm. The meeting will be at her office in Kernersville at 208 E Bodenhamer St. Kernersville.

 

 

Cheryl Kakouras

Office of Senator Dana Jones       

2113 Legislative Building

16 W Jones Street

Raleigh, NC  27603-5925

919-733-7850

Cheryl.kakouras@ncleg.gov

2015 Email from Commissioner Bill James

Cheryl Kakouras (Sen. Dana Jones) <Cheryl.Kakouras@ncleg.gov>Fri, Feb 21, 2025 at 7:35 AM

To: Joe Vincoli <joevincoli@gmail.com>

Hi Joe,

 

With all the snow cancellations, Senator Jones' schedule has changed. We will need to re-schedule your meeting with the Senator. I will circle back when some time opens up for a meeting.

Thank you and have a great day.

 

 

Cheryl Kakouras

Office of Senator Dana Jones       

2113 Legislative Building

16 W Jones Street

Raleigh, NC  27603-5925

919-733-7850

Cheryl.kakouras@ncleg.gov

 

From: Joe Vincoli <joevincoli@gmail.com>
Sent: Friday, February 21, 2025 12:54 AM
To: Sen. Dana Jones <Dana.Jones@ncleg.gov>
Subject: Fwd: 2015 Email from Commissioner Bill James

 

Senator Jones,

 

My adult son told me that there's a 'variation' on the Myth of Sisyphus where he pushes the rock up the mountain so many times that the mountain develops a flat spot at the top and at least the rock comes to rest.

 

I have been at this a very long time and I hope you will at least be 'the parent in the room'.

 

Note dates and start at bottom.

 

Joe


---------- Forwarded message ----------
From: William F. James, Jr <wjames@carolina.rr.com>
Date: Fri, May 1, 2015 at 5:15 PM
Subject: RE: Background on CHS Issue
To: Joe Vincoli <joevincoli@gmail.com>

 

She can say whatever she wants, I do not recall the Commissioners or even the Chairman EVER receiving any audits – external or internal (or being allowed access for the purposes of performing an internal audit). They do not follow our policies, they do not present any reports to the Commission. If they report to the Chair, I haven’t seen any reports listed as public (and if he or prior chairs received reports they would be public).

 

You can ask Trevor Fuller the current chair, perhaps he has been doing this.

 

The statute was written to provide the slight ‘appearance’ of oversight without having any real control.

 

Government lawyers or those that sue the government will have to get to the bottom of the matter.

 

I do know that it was originally set up by the City. It was a City of Charlotte hospital that was given to the authority to get it started. Later, the County got involved.

 

From: Joe Vincoli [mailto:joevincoli@gmail.com
Sent: Friday, May 1, 2015 4:49 PM
To: Commissioner Bill James
Subject: Fwd: Background on CHS Issue

 

Looks like they think the CC's are in charge.

 

---------- Forwarded message ----------
From: Moore, Jill D <moore@sog.unc.edu>
Date: Fri, May 1, 2015 at 4:18 PM
Subject: RE: Background on CHS Issue
To: Joe Vincoli <joevincoli@gmail.com>
 

Mr. Vincoli,

 

Thank you for your inquiry. You have been referred to me because I work in the area of public health law. We do not have anyone at the School of Government who works with issues that are specific to public hospitals. Unfortunately, that means that neither I nor any of my colleagues have expertise in this area. However, I told Professor Allen that I would be willing to look at the public hospital authority statutes to see if I might be able to address some of the questions in your original email.

 

I see Mr. Reagan has already addressed the public records question.

 

On your question of which elected officials have oversight responsibility, it appears the main roles of elected officials lie in appointing hospital commissioners (G.S. 131E-18), in receiving audits (G.S. 131E-29), and in making appropriations to the hospital authority (G.S. 131E-30). Either the mayor or the chairman of the board of county commissioners appoints the hospital commissioners and receives the audits. The elected officials that may appropriate funds are the members of the governing body of the city (i.e., city council) or county (board of county commissioners). I have explained each of these matters in a bit more detail below.

 

The hospital authority statutes state that hospital authority commissioners are appointed by the mayor or the chairman of the board of county  commissioners from a list of nominees presented by the existing hospital commissioners. Appointments must come from the hospital commissioners’ list of nominees; however, the mayor or chairman of the board of commissioners may require the hospital commissioners to submit additional lists of nominees. Hospital commissioners serve three-year terms and the statute does not place a limit on the number of terms that may be served. G.S. 131E-18. The appointing authority (i.e., mayor or chairman) may remove a hospital commissioner from office only for specified purposes and after giving the hospital commissioner notice and an opportunity to be heard. G.S. 131E-22. Upon original appointment, the hospital commissioners must submit an application to the Secretary of State for incorporation as a hospital authority. G.S. 131E-19. The Charlotte-Mecklenburg Hospital Authority’s initial application and subsequent amendments are available on the Secretary of State’s website at https://www.secretary.state.nc.us/Search/filings/4977755. It appears the hospital authority was initially created by the city of Charlotte and the initial hospital commissioners were appointed by the mayor. I do not know who is currently appointing and reappointing hospital commissioners for the authority, but I would assume local officials in Charlotte or Mecklenburg county can answer that question.

 

The legal powers and duties of a hospital authority are specified in G.S. 131E-23. Among many other things, the authority may appoint an administrator and employees. You asked several questions about employees in your original email. I do not know the answers to your specific questions; however, it does not appear to me that the employees of a hospital authority are subject to the State Human Resources Act (formerly the State Personnel Act). See G.S. 126-5. As I am not an employment lawyer I would urge you to double-check that conclusion with the Office of State Human Resources.

 

The hospital authority must file an audit report at least annually with the mayor of the city or the chairman of the board of county commissioners. G.S. 131E-29. The governing body of a city or county in which the hospital authority is located may appropriate and transfer funds to the authority from its general fund. G.S. 131E-30.

 

I hope this is at least somewhat useful. I’m sorry I’m unable to be of more assistance.

 

Jill Moore

 

Jill D. Moore

Associate Professor of Public Law & Government

School of Government

UNC-Chapel Hill

919.966.4442

 

 

 

E-mails sent to or from this e-mail address that relate to the School of Government's work are public records and may be subject to public access under the North Carolina public records law.

 

 

 

 

From: Joe Vincoli [mailto:joevincoli@gmail.com
Sent: Friday, May 01, 2015 12:55 PM
To: Moore, Jill D
Subject: Background on CHS Issue

 

Professor Moore,

 

I am forwarding the attached email from Walker Reagan concerning CHS, its incorporation, and its subjection to public records request.

 

Not answered in this reply is my key question:  which elected official(s) have oversight responsibility for decisions made by CHS.

 

To illustrate this point, CHS made a decision in relation to its health plan to deny its plan members equal access to seek medical services at a competing hospital (Presbyterian).  If CHS is a 'political subdivision of the state' which elected official can be held accountable for that decision?

 

A private employer, under ERISA, would be held to certain fiduciary standards that ensure such decisions are made with a 'single eye' toward the best interests of the plan member.

 

ERISA excludes governmental entities because Congress assumed that there would be governmental oversight of these types of decisions.  My concern in this case is that the employees of CHS (and other NC hospital authorities) are neither protected by ERISA nor protected by 'governmental oversight'.

 

Thanks,

 

Joe Vincoli

 

From: Walker Reagan (Research, Director) 
Sent: Monday, April 06, 2015 12:45 PM
To: Sen. Joyce Krawiec; Rep. Verla Insko
Cc: Gina Insko (Rep. Verla Insko); Robb Jansen (Sen. Joyce Krawiec); Erika Churchill (Research); Tim Hovis (Research); Brad Krehely (Research); Kelly Quick Tornow (Research)
Subject: [RTS-2015-00844] Appeal of CHS Public Records Request Denial (Sen. Joyce Krawiec; verlai@ncleg.net)

 

 

The Charlotte-Mecklenburg Hospital Authority was initially incorporated in 1943. The Authority was created by the City of Charlotte and the Mecklenburg County Commissioners in accordance with Part 2, Article 2 of Chapter 131E of the NC General Statutes.  (See G.S. 131E-15 et. seq.).  Once established, the Authority is a political subdivision of the State, separate from either the city or county, and operates under its authority set forth in the statutes and it’s articles of incorporation.

 

For public records purposes under Chapter 132 of the General Statutes, it is treated as a subdivision of the State under G.S. 132-1.  As Mr. Bethune said, under Chapter 132, requests for public records of the Authority are to be made to the Authority.  If the Authority fails to provide the public records requested, the requestor has the right to go to court to request a court order compelling release of the records.  G.S. 132-9, provided by Mr. Bethune below, sets out the procedure for bring such action. It also give the court the authority to award attorney’s fees to a party who successfully compels disclosure of public records.  Chapter 132 primarily defines what are legally public records, but other statutes outside of Chapter 132 may also set out exceptions to records held by governmental entities that are not public records.

 

Federal law does not apply to defining the legal status the Charlotte-Mecklenburg Hospital Authority or what constitutes a public record under North Carolina law.

 

Please let me know if you need any additional information.  Thanks.

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