UNC Hospitals seeks to add beds in Chapel Hill, Hillsborough

Less than a year after UNC Hospitals opened a 72-bed hospital in Hillsborough, the Chapel Hill health care system is seeking to expand that facility and also add more beds at its flagship hospital in Chapel Hill.

UNC’s dual permit application for the hospital expansions in Orange County represents the latest move by the system to broaden its growing regional health care empire. The UNC system already includes Rex Hospital in Raleigh and nine other hospitals in operation or under development.

Most of that explosive growth has taken place since the recession struck in 2008, the year that UNC added Chatham Hospital in Siler City. The expansions show no sign of abating, with UNC entering talks with Lenoir Memorial Hospital in March to create a management services agreement with that Kinston hospital.

UNC is asking the N.C. Department of Health and Human Services for approval to add 29 beds in Hillsborough and 55 in Chapel Hill. The deadline for a competing health care system to challenge UNC’s application is May 31, and a public hearing date has been set for June 16.

A legal challenge is highly likely. When UNC’s Hillsborough campus was awarded its first permit – known as the “certificate of need” – that approval was challenged by Alamance Regional Medical Center, delaying the opening of the Hillsborough hospital by more than 2 years.

The Hillsborough hospital began offering inpatient services Sept. 1, 2015. Now it’s ready to expand to 101 beds and proposing a new 4-story wing that would house 29 new beds and 30 licensed beds to be relocated from the main campus in Chapel Hill. The bed relocation would vacate space at the main campus to install 45 of the 55 beds being requested there.

UNC officials say the need for new hospital capacity is already strong and bound to grow stronger as the local population increases and ages.

“For several years UNC Hospitals has experienced periods of extremely high utilization during which the availability of beds for new admissions has been challenged,” UNC wrote in its April 15 application.

“When beds are unavailable and its emergency department is over capacity, UNC Hospitals must divert trauma patients, which reduces vital healthcare resources for the community and the state,” UNC wrote. “Similarly, UNC Hospitals occasionally must refuse to accept or delay transfers of patients from other facilities due to the lack of an appropriate bed.”

The rationale for requiring certificates of need is to control health care costs by preventing overbuilding in the health care system. Because the process imposes limits on health care development, it is prone to litigation and appeals as regional competitors scramble for the limited number of hospital beds and medical equipment rationed out by state regulators.

If approved the Hillsborough project, which is slated to cost about $77 million, is scheduled to begin next summer and end in 2020. It would add 29 acute care beds and relocate 30 rehabilitation beds from the Chapel Hill campus.

The Chapel Hill project, slated to cost about $29 million, would add 55 beds in the 7th floor area vacated by the relocation of the rehab beds to Hillsborough. It’s scheduled to begin in 2018 and end in 2022.

“The current shortage of general acute care beds severely compounds the problems faced by patients who are many times already stressed and battling difficult illnesses,” UNC wrote in its application.

John Murawski: 919-829-8932, @johnmurawski