In 2022, after reportedly waiting over five hours for care, a 77-year-old woman died in the emergency department of Novant Health New Hanover Regional Medical Center, the region’s largest hospital.

The incident prompted an investigation from the Centers for Medicare and Medicaid Services (CMS), which threatened to terminate Novant Health NHRMC’s Medicare contract following an inspection of the facility.

CMS restored the hospital to good standing after a reinspection found that immediate patient safety concerns had been resolved, but for many, the incident was a flashpoint moment in the hospital’s recent history, and for some, questions remain over whether the sale of the previously county-owned hospital to Novant Health was a mistake or not.

As the region’s flagship hospital, NHRMC shoulders an enormous burden: In many cases, it is the sole hospital for residents in need of specialized services nearby, especially those in neighboring rural areas.

Five years have passed since former state Attorney General Josh Stein signed off on the multibillion-dollar sale of the 823-bed hospital to Winston-Salem-based Novant Health.

The Asset Purchase Agreement (APA), which finalized the sale in 2021, included several specific obligations that Novant was required to uphold over the following five years and for the duration of its ownership.

Since then, population growth has continued in the region – leading the State Medical Facilities Plan to identify a need for 225 additional beds in New Hanover County – and competitors such as UNC Health and Columbus Regional Healthcare System have begun inching into a Novant-dominated market.

The question remains: As the caretaker of the area’s largest hospital, how has Novant Health delivered on its promises to bring high-quality care to residents? And how will it respond to a region where the needs keep growing?
 

NAVIGATING ROUGH SEAS 

Novant Health found itself in difficult waters immediately after the purchase.

“Doing a major acquisition and integration in the middle of a pandemic is probably not something I suggest people do again,” said Laurie Whalin, president of the Novant Health Coastal Region.

Nursing shortages led to the hospital relying heavily on travel nurses – over 400 at the pandemic’s peak, according to Amy Akers, chief nursing officer for Novant Health’s coastal region.

Rob Zapple, the only county commissioner to vote against the sale of the hospital to Novant in 2020, said that the travel nurse reliance contributed to a perceived cultural shift at the hospital.

He also pointed to leadership instability. Including Whalin and an interim leader, Novant Health NHRMC has hired four presidents since taking over the hospital.

“You just took an institution that was incredibly stable and incredibly popular in New Hanover County and made it feel unstable within our community,” Zapple said.

“Even pre-Novant, things were still stretched thin, but the culture was different,” said Phil Brown, former chief physician executive at NHRMC and now senior adviser for strategic health initiatives at the University of North Carolina Wilmington. “As a community hospital, we took care of our friends, neighbors and families, and there was a pride of being part of the organization that did that, no matter where inside the organization you worked.”

Novant Health NHRMC’s hospital safety grade from Leapfrog – an independent nonprofit watchdog organization – fell from a B to a C in fall 2024. CMS inpatient and overall star ratings remained at 2 out of 5. Both metrics showed a rise in hospital-acquired conditions, including falls and foreign objects retained after surgery.

According to Katie Stewart, director of healthcare ratings at Leapfrog, hospital grades are calculated through a combination of self-reported survey data and CMS data. As CMS data lags (data for NHRMC was collected from 2024), ratings don’t always reflect immediate progressions in hospital quality.

When Jon Martell, a retired chief medical officer from Hilo Medical Center in Hawaii, checked into Novant Health NHRMC for gallbladder surgery in 2024, he said staff ignored standard pre-surgery steps and blocked his attempts to call a Rapid Response Team. The experience prompted him to start the Cape Fear Five Star Project, a nonprofit organization advocating for improved care and transparency at the hospital.

“They were basically promising that they could deliver what UNC or Duke would deliver,” Martell said of Novant Health’s acquisition commitments. “And if you make that promise to a community, the community expects you to deliver.”

“We are dedicated to delivering safe and high-quality care because that's what our patients deserve,” Whalin said in an email in response. “Our dedication is not motivated by third-party rating systems or organizations but driven by our purpose to create a healthier future.”

Whalin maintains that the hospital quality standards have improved significantly in recent years. “Having been here through that entire period and beyond, we are not the same hospital,” she said.

Whalin maintains that as both Leapfrog and CMS ratings include lagging indicators, they do not reflect “the hospital we are today.”

“Our real-time quality data tells a very different story,” she said.

To highlight progress to county commissioners on the fifth anniversary of Novant’s ownership of the hospital, Novant Health NHRMC leaders praised reductions in hospital-acquired infections and improved cardiac surgery outcomes.

In May, CMS upgraded the hospital to three stars, citing improvements in mortality, safety of care and timely and effective care.

Martell, however, is skeptical that the CMS upgrade will be permanent. “CMS looks at outcomes; Leapfrog looks at the process,” he said. “Anybody who has any background in process management knows that you don’t get the outcomes unless you get the process right.”

Leapfrog scores indicate that NHRMC has yet to improve its processes, Martell said, specifically its communication, which includes staff responsiveness, communication about medicines and discharge information.

According to Leapfrog, overall staff responsiveness has improved since the spring of 2024, although it remains 79 out of 100, below the national average of 82 for hospitals surveyed.

“If your staff responsiveness – how the staff responds to patient inquiries, patient needs – if that’s in the bottom 25%, you’re really going to struggle,” he said. 

Stewart said that hospital ratings don’t always require many resources to improve and that changes typically start with leadership initiative.

“When we see hospitals really making improvements, it starts with leadership,” she said. The response to a bad grade shouldn’t be, ‘The data is old’ or ‘The methodology is flawed.’ It should be, ‘This is what we’re going to do moving forward,’ and making that known to the public and to their providers.”

“Novant Health as a system does very well. This round, they have seven As, five Bs and this one C: New Hanover,” she added. “So, the question is: What are they doing that works at their other hospitals, and how can they carry that over to New Hanover?”

 

CREATING A HEALTHCARE MONOLITH

The sale of the county-owned hospital was controversial, although decision-makers argued a larger financial partner was essential to sustain ongoing healthcare commitments.

“The conclusion, which was correct, is that it was not a sustainable model for the long run,” said Spence Broadhurst, co-chairman of a 21-member Partnership Advisory Group that was assembled to review proposals from top contenders, including Novant Health, Atrium Health, Duke Health and UNC Health.

Novant’s proposal stood out, Broadhurst said, for its alignment with the existing culture at NHRMC. Additionally, Novant’s proposal included a long-term partnership among Novant Health, UNC Health and the UNC School of Medicine to expand the school of medicine’s existing presence at NHRMC.

“Everything about Novant felt like it was New Hanover Regional Medical Center on a bigger scale,” Broadhurst said. “Their philosophy, everything we dug into, felt that way, and I personally still feel that way.”

The $1.5 billion sale came with substantial obligations: a $2.5 billion investment into regional healthcare infrastructure, $600 million in routine capital investments, plus the establishment of the New Hanover Community Endowment fund.

As a result, Novant Health is now the region’s largest employer and held 96% of the healthcare market share in Wilmington as of 2024, according to KFF, a nonprofit health policy research organization.

Novant Health’s regional network expands through Brunswick County, home to longtime Novant Health Brunswick Medical Center, and in Pender County, with the Novant Health Pender Medical Center, which it absorbed ownership of in 2023, plus the 66-bed Novant Health Scotts Hill Medical Center. 

In early 2026, Novant’s board approved a master facility plan, committing over $1 billion in new infrastructure in the area, including a new 120-bed heart and vascular patient tower on South 17th Street, an 80,000-square-foot expansion to a heart and vascular medical office and a new 60-room physical rehabilitation hospital. 

According to Whalin, Novant Health has now committed $2 billion of the $2.5 billion investment outlined in the APA, not including a proposed 20-bed hospital in Leland nor the proposed freestanding emergency department that would be built in Carolina Shores. 

“I will be honest, being part of a large healthcare organization like Novant has not always been easy,” said Bill Smith, lead physician of Novant Health’s heart and vascular institute. “But we could not have had the growth, sustained the growth that we’ve had, or maintained the amount of energy and investment in the next generation, without Novant, without a large, financially stable corporate partner who does support and understand this market.”


 

STEPS FORWARD

Despite Novant Health’s regional expansions, the need for healthcare continues to grow and has been identified by competing providers like UNC Health, which recently submitted a certificate of need (CON) application to the state with the aim of building a community hospital in Wilmington. 

Ernie Bovio, former president of the Novant Health Coastal Region, announced his departure from the organization earlier this year – after accepting a position as regional president of UNC Health’s Southeast Coastal Region. 

“Novant is working very, very hard and is making some great investments, but they’re just not keeping up,” he said. “Wouldn’t it be great to have another healthcare system making investments, building capacity and bringing in more physicians to serve the growing community?” 

UNC Health’s proposal was directly supported by Wilmington Health, a physician-owned practice led by CEO Jeff James, who emphasized that the practice knows “patients are interested in choice.” 

For Zapple, more healthcare options are essential to improving overall health in the county: He points to the 17-year life expectancy gap identified by the Cape Fear Collective and the Coastal Journalism Hub. According to the data, the gap exists between a predominantly affluent neighborhood and a lower-income neighborhood in Wilmington and, to Zapple, is evidence of strained healthcare resources in the community. 

“They’ve done a lot in the community that we’re thankful for,” said Zapple, of Novant Health, “and adding this next layer of a little bit of competition here, I think, will help them use these new assets even better.” 

In addition to UNC Health, another outside player, Atrium Health, has submitted a CON application to build a full-service hospital in New Hanover County.

As for how Novant Health and the hospital will respond to increased market competition, Whalin believes Novant is still uniquely positioned to serve area residents best. 

“I’m not concerned about anybody else’s plans,” Whalin said of the region’s broadening healthcare landscape. “I think healthcare access for patients is always a good thing. I’m committed to it. But I think Novant is meeting that need. 

“We generated the need for those beds,” she said of the 225 beds identified in the State’s Medical Facilities Plan. “New Hanover County needs inpatient beds like today, and we can put those beds in circulation the fastest.” 

Novant Health has submitted its own CON application for those beds as part of the proposed heart and vascular tower. 

Editor's note: This version updates the story with information about the certificate of need applications health systems have filed to build hospitals or add beds to existing facilities in New Hanover County.