'We have no intention of leaving North Carolina,' Atrium Health CFO says


The CFO of Charlotte, N.C.-based Atrium Health said the health system has no plans to abandon its mission in North Carolina after state regulators denied a request to re-finance debt from Macon, Ga.-based Navicent Health.

Atrium Health and Navicent finalized a "strategic combination" in January, allowing Atrium to expand into Georgia.

In June, during a North Carolina Local Government Commission hearing, Atrium Health requested that state regulators allow it to refinance $300 million in debt from Navicent, CBS-affiliate TV station WBTV reports.

As a county hospital authority, the system may ask for state approval to take on new debt.

Atrium Health reportedly sought to establish a single entity to issue and service the debt, with bond holders being responsible for ensuring the debt was paid back. The system projected savings of $29 million in debt service costs.

But the commission rejected Atrium's request.

"It had everything to do with the long-term implications," commission member Mike Philbeck told WBTV of the request. "To what degree are we making the citizens of North Carolina the ultimate backers of it?"

People present for the June commission meeting told the TV station Anthony DeFurio, executive vice president and CFO of Atrium, said the system could consider moving its business operations if it didn't  get commission approval. The CFO prefaced his remarks by saying they were not an attempt to threaten regulators, the sources added.

"During a recent Local Government Commission meeting, where Atrium Health was proposing to issue a guarantee of Navicent Health’s debt, I was attempting to explain how the support of our home state is so important to Atrium Health and our future," said Mr. DeFurio, in a statement to Becker’s.

"While my choice of words could have been more thoughtful and were initially misinterpreted by commission members, at no time during the meeting, or during my following conversation with the LGC when asked to clarify my comments, did I intend to insinuate or make any threat regarding Atrium Health's future in North Carolina," said the CFO.

"Atrium Health will continue to look for ways to improve our patients’ access to essential health services and reduce the burden of the cost of health care on all of our citizens, and we have no intention of leaving North Carolina. This is our home, and we are privileged to serve and deliver on our mission to improve health, elevate hope and advance healing — for all," he said.

For now, Navicent Health will not be able to refinance its existing debt through Atrium Health, Atrium officials said.

"We are constantly looking for ways to lower the cost of healthcare. and approval would have allowed Navicent Health to reinvest the savings as a nonprofit into the community it serves, as well as further strengthen the Atrium Health credit group," said Chris Berger, a spokesperson for Atrium. "While we were hoping to receive approval for this debt refinancing, we will continue looking for the best ways to continue making positive impacts on the health of the communities we are privileged to serve."


More articles on healthcare finance: 

For-profit hospital stock report: Week of June 10-14
Missouri hospital won't reopen
IU Health to sell $678M in bonds to finance campus upgrades, refinance debt

Copyright © 2021 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars