Novant Health Objects to Rex Healthcare Joint Venture ASC: 4 Insights

Raleigh, N.C.-based Rex Healthcare, a subsidiary of UNC Healthcare, plans to open a joint venture ambulatory surgery center in Wakefield, N.C., but Novant Health, based in Winston-Salem, N.C., has voiced strong opposition, according to a Triad Business Journal report.

Here are four things to know about the contested ASC project.

1. Rex Healthcare's proposed project would convert an operating room at its Wakefield campus to an ASC. The process, if approved, is expected to cost less than $500,000. The health system hopes to partner with 20 to 30 surgeons for the joint venture project. Rex Healthcare already operates two similar projects in the state.

2. Novant Health already operates three operating rooms in Louisburg through its Novant Health Franklin Regional Medical Center. The health system also plans to open the Novant Health Same Day Surgery Franklin in Youngsville, just 10 miles away from Rex Healthcare's proposed ASC.

3. Rex Healthcare filed its own objects to the Novant Health project, which received certificate of need approval in April. The Novant surgery center will have two ORs and one procedure room. The health system argues that its ASC will provide the area with adequate access to outpatient surgery. On the other hand, Rex Healthcare representatives believe the Wakefield campus ASC would be able to provide superior service.

4. North Carolina has had a certificate of need program since 1978. It is one of 27 states with a CON program that regulates ASCs. The state's Department of Health and Human Services oversees the CON application process and makes the final decision regarding new projects. The department could make a decision regarding Rex Healthcare's application by the end of July, or state regulators could delay the decision until September.

More Articles on Transactions and Valuation Issues:
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