August 1997
Philanthropy Journal of North Carolina • 5
Greensboro health care nonprofits may mei^
Wesley Long Community Hospital
and Moses Cone Health Systems
seek federal approval for merger
and develop an outline to create a
foundation.
By Leslie Broberg
Greensboro
In years to come, the summer of
1997 may be remembered as the sea
son of nonprofit hospital mergers in
the Piedmont.
Just as the new Novant Health
System in Winston-Salem and
Charlotte was formally emerging as a
regional health care giant,
Greensboro’s Wesley Long
Community Hospital and Moses Cone
Health System were entering the
final phase of their proposed merger
plans.
In early July, the two hospitals
filed their officiM mei^r notice with
the Federal Trade Commission,
which will decide whether the merger
would create an unwanted health
care monopoly in Greensboro.
Hospital officials are hoping for an
approval within 30 days.
Combining the two interests
would involve folding the 309-bed
Wesley Long HEALTH
Community Hospital CARE
into the 547-bed
Moses Cone
Memorial Hospital,
which includes the
115-bed Women’s Hospital of
Greensboro and other specialty ser
vices and physician practices.
In addition to saving the com
bined hospitals $53 million over five
years, the merger would establish a
more competitive force in the local
health care market that now includes
Novant Health, with its bold plans to
serve more than 2.2 million people in
North Carolina and parts of Vir^a
and South Carolina.
As hospital officials await the
FTC ruling, they are laying the
groundwork for the $50 millkp
Wesley Long Community Health
Foundation, to be funded by the hos
pital’s former sale of shares in PHP
Inc., the health maintenance organi
zation
The foundation will award $2.5
million in grants each year for pro
jects that help improve the health of
the community.
The hospitals have already
named officers to this new founda
tion, which will begin operating if the
merger is approved. William R.
Rogers, the former president of
Guilford College, was named chair
man, and Warren G. Corgan, a former
vice president at AT&T, was named
vice chairman.
Hospitals
Continued from page 3
cialties.
Facing managed care and height
ened competition, many hospitals
around the country have been seek
ing partners to help strengthen their
stance in the health care arena.
Carolina Medicorp and
Presbyterian were no exception. The
for-profit Columbia/HCA Healthcare
Corp., for example, was once rumored
to be a possible partner for
Presbyterian.
But Carolina Medicorp and
Presbyterian decided to join forces,
maintaining their nonprofit status
and keeping their form of health care
out of the hands of Wall Street
investors and distant managers.
“We will retain medical manage
ment in the providers’ hands,” says
Gregory J. Beier, who was named
president of Novant’s Triad region.
“We’ll look to the MDs — not the
MBAs — to develop the best ways to
practice medicine.”
Novant will be led by Wiles, who
was previously the president and
chief executive officer of Carolina
Medicorp. Paul E Betzold, who was
president and chief executive officer
at Presbyterian Healthcare System, is
now president of Novant’s Southern
Piedmont Region.
“As we began the due diligence
process, we found no impediments to
proceeding,” Betzold says. “It con
firmed what we had been saying aU
along—this is a merger of two equals
with similar missions and visions of
the future.”
hi seeking its new status, Novant
needed routine state and federal
approvals from the North Carolina
Medical Care Commission, the
Internal Revenue Service and the
Federal Trade Commission.
Novant also had to convince
Forsyth County to change the bylaws
of Carolina Medicorp and Forsyth
Memorial Hospital. Since 1984, when
Carolina Medicorp was created to run
Forsyth Memorial, county commis
sioners have appointed 12 of
Carolina’s 19 trustees.
But a change was needed if the
new entity was to reach beyond the
scope of the county.
Now, under the changed bylaws,
Forsyth County Commissioners will
appoint one person to Novant’s Board
of Trustees. They will also approve
the nominations of 12 of the 19
Paul M. Wiles
trustees on the board that will over
see Forsyth Memorial after the merg
er.
The interesting fallout from this
exchange was
a $10 million
gift to the
county that
will likely be
used to pay for
health care
needs in the
county.
The pay
ment was
“never a key
factor in the
merger,” says Peter Brunstetter,
chairman of the Forsyth County
Commission and the new Forsyth
area trustee on Novant’s board. “It is
a return to the government for an
asset that has grown over time,” he
explains.
Brunstetter says the money will be
put in a bank to collect interest for
one year until County Manager
Graham Pervler develops suggestions
for its use.
But, Pervier adds, “we will take
our time in recommending strate
gies.”
NONPROFIT BRIEFS
LEADERSHIP
Web site for women
Juliette Tracey Gcddman is
the new director of development
and outreach at Women’s
Connection Online, a web site for
professional women and women
business owners, located at
http:/Avww.womenconnect.
com>.
Goldman will work to
increase the visibility of women
business owners, women’s non
profit organizations and volun
teer efforts on the Internet. She
also will work to improve
Internet access for these women.
Goldman was director of
development and outreach for
the Washington Area Community
Investment Fund and has served
as deputy director of the
National Women’s Business
Council.
research
Why do nonprofits die?
New research sponsored by
the Nonprofit Sector Research
Fund attempts to answer the
question: Why do nonprofits die?
Researchers used a sample of
organizations tracked over 15
years and interviewed represen
tatives from “dead” organiza
tions. The study found smaller
and younger organizations were
more likely to die than older and
larger ones. Small size was sin
gled out by 37 percent of respon
dents as the main reason for
closing.
Twenty percent pointed to
organizational instability, such
as personal loss and turnover, as
the most critical factor. A signifi
cant number indicated their
organizations were harmed by
the influence of strong board
members.
housing
Fannie Mae would
aid Habitat
The Fannie Mae Foundation
has announced a $1 million chal
lenge grant to Habitat for
Humanity International. The
announcement was made at the
First Annual James W. Rouse
Forum on the American City in
Washington.
The Fannie Mae Foundation’s
$1 million challenge grant over
two years will support Habitat
for Humanity International in
developing a dedicated operating
reserve fund of $10 million,
based on an annual operating
budget projected to grow to $100
million by 2002. The Fannie Mae
Foundation will match $1 for
every $3 Habitat raises in
response to its challenge grant.
CaE (800) HABITAT.
FUNDRAISING
Used-car charity
under fire
The nonprofit that built a
multi-million-dollar charity from
used car donations was slapped
with a preliminary injunction
recently amid charges of fraud
and false advertising, according
to reports by the San Francisco
Examiner and the Associated
Press.
The order, passed down by
Superior Court Judge William
Cahill, means the Jewish
Educational Center must close
until a hi^er court overturns
the ruling. Cahill had appointed
a receiver to oversee the non
profit’s assets, which the charity
reported as $1.8 million.
The charity runs one of the
largest for-profit used-car deal
ers in the U.S., with sales of $8.5
million last year. But it spent
only $1.45 million on charity
causes.
1997 North Carolina Funders Summit
Making Chanqe
Happen
A conversation among funders and
state government decision-makers
■ Sponsored hy the
Philanthropy Journal of North Carolina
■ Co-sponsored by the
Office of the Governor
Thursday, October 30, 1997
Raleigh Marriott Crabtree Valley
Raleigh, North Carolina
Featured Speakers
George Autry, President, MDC Inc.
Tom Bacon, Director, North Carolina Area
Health Education Centers
Pheon Beal, Associate Director, Employment
Programs, State Division of Social Services
Philip Blumenthal, Director and Trustee,
Blumenthal Foundation
Robin Britt, Policy Adviser to the Governor
for Children, Families and Nonprofits
David l^bxi. State Secretary of Human Resources
Jeanne Butler, Executive Director, Thomas S.
Kenan Institute for the Arts
Rick Carlisle, Adviser to the Governor for
Economic Policy
Todd Cohen, Editor and Publisher,
Phi/anthroP)i Journal of North Carolina
Ray Cope, Executive Director, Kate B.
Reynolds Charitable Trust
Janis S. Dempster, Director of Corporate
Communications, Sprint
John Doman, President, Public School Forum
of North Carolina
Katie Dorsett, State Secretary of Administration
William Friday, Executive Director, William
R. Kenan Jr. Charitable Trust
Jim Henderson, Head of Upper School,
Carolina Friends School
Bill Holman, Director of Government Affairs,
North Carolina Chapter, Nature Conservancy
Tom Houlihan, Governor’s Education Adviser
The Honorable James B. Hunt Jr., Governor
of North Carolina
Mack Jarvis, State Secretary of Corrections
Joseph Kilpatrick, Assistant Director, Z.
Smith Reynolds Foundation
Tom Lambeth, Executive Director, Z. Smith
Reynolds Foundation
Cathy Lawrence, Executive Director, Warren
Family Institute
Peter Leousis, Assistant State Secretary for
Children, Youth and Families
Rob Maddrey, President, Arts North Carolina
Betty McCain, State Secretary of Cultural
Resources
Wayne McDevitt, State Secretary of
Environment, Health and Natural Resources
Kate McGuire, Program Director, N.C.
Center for Nonprofits
Sandra Mikush, Assistant Director, Mary
Reynolds Babcock Foudnation
Richard Moore, State Secretary of Crime
Control and Public Safety
Hilda Ragland'Pinnix, Manager, Community
Relations, Carolina Power &. Light Co.
James B. Hunt Jr,
William Friday
Jane Preyer, Director,
North Carolina Environmental Defense Fund
Deborah Ross, Executive Director and Legal
Director, American Civil Liberties Union of
North Carolina
Lao Rubert, Executive Director, Carolina
Justice Policy Center
Jonathan Sher, President, North Carolina
Child Advocacy Institute
Pam Silberman, Research Fellow, Cecil G. Sheps
Center for Health Services Research, UNC-CH
Leslie Takahashi, Executive Director,
Wildacres Leadership Initiative
Mike Ward, State Superintendent of Public
Instruction
Don Wells, Director, Certificate Program in
Nonprofit Management, Duke University
The 3rd annual statewide gathering
for North Carolina’s
grantmakers
Conference open to
funders and state
officials only.
ii Journal subscribers
save $25 on confer-
ence registration.
* To request a
brochure, please call
(919) 899-3740
■ Deadline to register is
October 16, 1997