BELHAVEN — On July 1, 2014, health care in Belhaven changed drastically.

Vidant Pungo Hospital, one of two Beaufort County hospitals, closed its doors, sending a ripple effect from Washington to Swan Quarter.

Fast-forward to Dec. 28, 2016, and the hospital, once a centerpiece for the town, was reduced to a pile of rubble.

 

A doomed fate

Vidant Pungo Hospital, formerly known as Pungo District Hospital, was a late-1940s facility opened under the Hill-Burton Act, which allotted funds to provide free or low-cost health care through construction or modernization of medical facilities.

Vidant Health took over the hospital in 2011, but announced plans to close it in late 2013, after operating on a deficit of more than $1 million.

Belhaven is home to many low-income residents, and state restrictions on Medicare/Medicaid coverage put the final nail in the coffin for the hospital’s viability. The facility was also in need of updates and repairs.

“What we said is, ‘Let’s try to keep it here as long as we can.’ Because we’re very, very hopeful the economy would turn around, that perhaps reimbursement would go up and the third thing, which is really driving the decision right now, is that facility would stand the test of time and allow us to maintain that facility. None of those three things have happened,” said Vidant CEO and President Dr. David Herman at a forum in September 2013.

In response to public outcry, the state NAACP submitted a Title VI complaint on Jan. 7, 2014, alleging “a continuing pattern of deception and discrimination” against minority groups in the Belhaven area.

In April of that year, Vidant signed an agreement that pledged $1 million to the Town of Belhaven to assist with transferring the hospital to another management company. The Beaufort County Board of Commissioners also voted to provide a loan of $2 million to the cause.

The agreement provided a 90-day extension for the hospital to remain in operation to give the Town time to find a management company.

However, despite this seemingly positive step for Vidant Pungo, efforts were to no avail, and the facility closed July 1, 2014.

 

‘Do or die’

The closure of Vidant Pungo Hospital removed emergency care from Belhaven, and the closest hospitals are now Vidant Beaufort Hospital in Washington and CarolinaEast Medical Center in New Bern.

Vidant did agree, however, to build a 24-hour multispecialty clinic, which would provide immediate and specialty care to residents. Officials said they believed this to be a more sustainable model of health care for Belhaven.

“Belhaven and the region would benefit from this new facility. We remain committed to pursuing health care solutions that will serve this region,” Herman said at the time.

The East Water Street property was turned back over to Pantego Creek LLC, a group formed to oversee the property’s management, which still owns it today.

A couple of weeks after Vidant Pungo’s closing, Belhaven Mayor Adam O’Neal made a 275-mile walk to Washington, D.C., as part of the Save Our Hospital campaign in support of rural health care.

“Belhaven’s battle to hold onto emergency health care is shaping up to be a do-or-die challenge for rural America,” O’Neal said in July 2014.

Around the same time, 48-year- old Swan Quarter resident Portia Gibbs died from cardiac arrest while waiting for a helicopter transport. Gibbs’ death led to much criticism from hospital supporters, who pointed out that, if open, Vidant Pungo was only 30 miles away from Gibbs and might have saved her life.

The N.C. NAACP reinstated its Title VI complaint against Vidant and Pantego Creek. Belhaven also requested a temporary restraining order in August 2014 to stop the removal of equipment, suspension of utility services and demolition of the hospital. The town and civil rights group launched complaints against Vidant and Pantego Creek alleging breach of contract, fraud, breach of fiduciary duty and unfair trade practices.

Vidant, maintaining its position, then requested that the complaints be moved to federal court.

Toward the end of 2014, the Town announced that it was in talks with the United States Department of Agriculture regarding a $6 million loan, which could potentially cover the cost of reopening the hospital.

Two of the USDA’s stipulations to secure the loan were: obtaining a certificate of need — essentially a license to run a hospital — and obtaining a property title.

“It is essential to obtain the property to get grants to get the hospital going again. I feel like as soon as an unbiased judge sees this situation and the things done in bad faith, justice will appear quickly,” O’Neal stated at the time.

 

Property pursuit

In January 2015, the Town announced its impending management contract with Florida-based New Frontier Hospitals, although that plan would never come to fruition.

In March of that year, Belhaven began a push to obtain the hospital property via eminent domain. O’Neal said he believed the property should be returned to the town for use.

A new hospital board, Pungo Medical Center, was also formed, comprised of seven members: O’Neal, Hood Richardson, Eunice Williams, Scott Ellis, Jim Madson, Archie Green and Dick Ray.

Pantego Creek, however, continued to decline to hand over the property, as it did not view the town’s reopening plans as viable.

Pantego Creek’s four designated managers, Deb Sparrow, Lynn Ross, Brantley Tillman and Darren Armstrong, wrote: “We had, and continue to have, no confidence that the Hospital can be operated profitably as proposed by Mayor O’Neal. They simply have failed at every turn to provide anything more than unrealistic dreams.”

The managers came under fire for holding onto the property, but they argued that any decisions were made by the entire membership, and the membership had voted previously to keep the property.

In September 2015, in an effort to have the USDA’s certificate of need requirement waived, O’Neal marched to Raleigh to speak with legislators. Legislators then passed a provision to clarify the legal definition of Belhaven’s hospital building as a “legacy medical care facility,” thus eliminating the need for the town to obtain the certificate of need. The last stipulation to meet became, once again, obtaining the property.

In the meantime, a federal judge ruled that the Title VI lawsuit be moved back to state court. Judge Milton Fitch Jr., the first judge to preside over the hearings in state court, was unexpectedly removed from the case.

The case then went to Beaufort County Superior Court in October 2015, and Superior Court Judge Stuart Albright threw out the claims. Belhaven and the NAACP appealed the decision and filed another complaint regarding the removal of Fitch, an African-American.

 

The battle continues

In the 2015 municipal elections, O’Neal eked out a 60-vote win over opponent Ricky Radcliffe, solidifying his plans to continue with reopening the hospital facility.

With the recent loss of community leader Dr. Charles O. Boyette still fresh on their minds, Belhaven officials unrolled a plan for veterans care in March 2016 with the help of Strategic Healthcare LLC, a subsidiary of People’s Choice Hospital Management. Strategic Healthcare had plans to place 30-35 beds in the reopened hospital solely for veterans’ use.

With fears of the hospital’s demise mounting in mid-2016, O’Neal threatened to declare a State of Emergency in Belhaven, setting off shockwaves throughout the town. Some residents set up a makeshift camp and vowed to keep watch over the building.

Around the same time, Strategic Healthcare offered $1 million to Pantego Creek for the hospital property.

In June 2016, Vidant opened its $6 million multispecialty clinic, as promised. Open 24 hours a day, the clinic offers services such as ultrasound technology, physical therapy, X-ray capabilities, lab workspaces, cardiology consults, prenatal care, on-site health coach and regular primary care, to name several. There are 19 exam rooms and a treatment room for biopsies or lacerations.

Another feature of the multispecialty clinic is its emergency vehicle access and helicopter pad for emergency transports.

Some Belhaven residents viewed the clinic with disdain, arguing that the area needed a full-service hospital, not a clinic.

 

End of an era

During the second half of 2016, more problems developed with the plans to reopen the old hospital.

Because the stipulation of obtaining the property had not been fulfilled, the window for the $6 million USDA loan expired.

In the years it sat idle, the building was also privy to deterioration and mold accumulation. According to a USDA report, major renovations would be needed if the building were to house anything, let alone a hospital.

For unknown reasons, the $1 million offer from Strategic was also withdrawn, so Pantego Creek’s managers asked the membership to vote on demolishing it.

Pantego Creek decided in mid-November to move forward with demolition.

“Pungo Medical Center, led by Belhaven Mayor Adam O’Neal, has had more than two and a half years to find an alternative solution for a new hospital. To date, this effort has not demonstrated that conditions necessary for the now-expired USDA loan commitment can be met, nor have the Mayor or the Medical Center presented a viable plan with a realistic timeline,” Pantego Creek said in a statement.

Pungo Medical Center’s subsequent offers of $500,000 and $665,000 were rejected, as they fell below the property’s value, according to Pantego Creek. O’Neal again traveled to Washington, D.C., appealing to the Justice Department for assistance.

Superior Court Judge Cy Grant issued a temporary restraining order on Nov. 28 to stop demolition after eight of the LLC’s members launched complaints alleging the membership was given misleading information in an effort to sway votes in favor of demolishing the old building.

Superior Court Judge Gregory P. McGuire handed down a ruling Dec. 28, denying a preliminary injunction on demolition proceedings. Demolition crews stood ready at the site to begin work just hours after the decision.

“We did the very best we could. We have nothing to be ashamed of,” O’Neal said the next day, adding that Save Our Hospital supporters were still looking at other options.

The Title VI lawsuit remains buried in appeals court, with no hearing date in sight.

The future of the property and what it will be used for now remains unknown at this time.