The state Senate is in a generous mood when it comes to helping the UNC Health Care System.
For starters, the Senate will introduce a budget this morning that includes a $25 million subsidy for the system's flagship UNC Hospitals in Chapel Hill. That's a big improvement from the House version, which slashed the subsidy to nothing.
And three key Republican leaders said Monday that they aren't interested in forcing a sale of UNC Health's Raleigh subsidiary, Rex Healthcare. Senate President pro tempore Phil Berger questioned whether the legislature should even have a role in the future of Rex.
WakeMed CEO Bill Atkinson has proposed buying Rex from UNC Health for $750 million. UNC Health officials have said that they will consider a formal offer but that they don't want to sell Rex.
So Atkinson is seeking support from state lawmakers for the hostile takeover bid, arguing that the money could help bolster the state's fragile finances. Berger, Sen. Neal Hunt of Raleigh and Sen. Richard Stevens of Cary agreed during a discussion at The News & Observer on Monday that selling an asset like Rex isn't a good way to solve the state's fiscal woes but didn't rule out a sale in the future.
"The last thing we need is an influx of one-time money when we're trying to balance the budget in a responsible way," Berger said. "I see no need to do anything in haste" and added that any review would need to study whether "divestiture is a positive thing."
If a sale of Rex were to happen, it would be crucial to ensure that the money isn't used to "fill budget gaps," but to be put into "a trust fund to support indigent medical care," said Hunt, who co-chairs the Senate Budget Committee.
Not that UNC Health is getting all it wants. The Senate subsidy for UNC Hospitals is less than the $33 million included in the budget proposed by Gov. Bev Perdue. UNC Hospitals received $36 million this year.
Still, any appropriation would be a blow to WakeMed, which has lobbied that UNC Health is using taxpayer money to help recruit physician groups and support its "predatory" expansion strategy in Wake County.
Senate leaders decided that UNC Health needs the money to help offset the millions in charity care it provides every year, said Stevens, who co-chairs the Senate's budget-writing committee. "It's the state's health system," he added.
It probably didn't hurt that UNC Health has orchestrated a massive lobbying effort at the General Assembly. That has included CEO Bill Roper and more than 50 physicians and faculty visiting Raleigh to meet with state lawmakers in the House and Senate.
"This is a very hard year for the state and we appreciate the Senate realizing that these funds are very needed," said UNC Health spokeswoman Karen McCall. She declined to comment about whether UNC Health will seek to get a bigger subsidy as lawmakers negotiate a final budget.
"This will be a long process," she added. "Just as we have during most of the session, we will continue to talk to legislators about the teaching, research and clinical care we provide."
Hagan backs worker aid
U.S. Sen. Kay Hagan joined 41 other senators in sending a letter to President Barack Obama on Monday supporting his efforts to get more money to re-educate workers laid off from manufacturing jobs.
The Trade Adjustment Assistance program offers health care and job training financial assistance to workers who have lost their jobs through international trade.
Obama told Congress earlier this year that he won't move ahead with proposed trade agreements with Colombia, Panama and South Korea unless TAA funding is kept at 2009 levels.
That funding was included in the 2009 American Recovery and Reinvestment Act, the stimulus law Obama signed shortly after taking office.
That law expanded health care credits and offered assistance to all employees whose jobs had been moved offshore, not just those moved because of international trade deals, according to The Hill newspaper.
"Trade Adjustment Assistance is a critical lifeline for distressed workers in North Carolina and across the country who find themselves unemployed through no fault of their own," Hagan said. "A long-term extension of this program is essential to keeping our workforce competitive in the 21st century economy."
According to Hagan's office, an estimated 18,331 North Carolina workers have been certified to receive TAA since reforms took effect in May 2009. Last year, displaced workers in North Carolina received more than $56 million through TAA - the second largest amount given to a single state - to help them develop skills to find new jobs, Hagan's office said.
Compiled by staff writer Alan M. Wolf and Washington correspondent Barbara Barrett
alan.wolf@newsobserver.com or 919-829-4572
