§ 116-37. University of North Carolina Health Care System.
§ 116‑37. University ofNorth Carolina Health Care System.
(a) Creation of System.
(1) There is herebyestablished the University of North Carolina Health Care System, effectiveNovember 1, 1998, which shall be governed and administered as an affiliatedenterprise of The University of North Carolina in accordance with theprovisions of this section, to provide patient care, facilitate the educationof physicians and other health care providers, conduct research collaborativelywith the health sciences schools of the University of North Carolina at ChapelHill, and render other services designed to promote the health and well‑beingof the citizens of North Carolina.
(2) As of November 1,1998, all of the rights, privileges, liabilities, and obligations of the boardof directors of the University of North Carolina Hospitals at Chapel Hill, notinconsistent with the provisions of this section, shall be transferred to andassumed by the board of directors of the University of North Carolina HealthCare System.
(3) The University ofNorth Carolina Hospitals at Chapel Hill and the clinical patient care programsestablished or maintained by the School of Medicine of the University of NorthCarolina at Chapel Hill shall be governed by the board of directors of the Universityof North Carolina Health Care System.
(4) With respect to theprovisions of subsections (d), (e), (f), (h), (i), (j), and (k) of thissection, the board of directors may adopt policies that make the authoritiesand responsibilities established by one or more of said subsections separatelyapplicable either to the University of North Carolina Hospitals at Chapel Hillor to the clinical patient care programs of the School of Medicine of theUniversity of North Carolina at Chapel Hill, or to both.
(5) To effect an orderlytransition, the policies and procedures of the clinical patient care programsof the School of Medicine of the University of North Carolina at Chapel Hilland of the University of North Carolina Hospitals at Chapel Hill effective asof October 31, 1998, shall remain effective in accordance with their termsuntil changed by the Board of Directors of the University of North CarolinaHealth Care System.
(b) Board of Directors. There is hereby established a board of directors of the University of NorthCarolina Health Care System, effective November 1, 1998.
(1) The board ofdirectors initially shall be composed as follows:
a. A minimum of sixmembers ex officio of said board shall be the President of The University ofNorth Carolina (or the President's designee); the Chief Executive Officer ofthe University of North Carolina Health Care System; two administrativeofficers of the University of North Carolina at Chapel Hill designated by theChancellor of that institution; and two members of the faculty of the School ofMedicine of the University of North Carolina at Chapel Hill designated by theDean of the School of Medicine; provided, that if not such a member ex officioby virtue of holding one or more of the offices aforementioned, additional exofficio memberships shall be held by the President of the University of NorthCarolina Hospitals at Chapel Hill and the Dean of the School of Medicine of theUniversity of North Carolina at Chapel Hill, for a total potential ex officiomembership of eight.
b. No less than nineand no more than 21 members at large, which number shall be determined by theboard of directors, shall be appointed for four‑year terms, commencing onNovember 1 of the year of appointment; provided, that the initial class of at‑largemembers shall include the persons who hold the appointed memberships on theboard of directors of the University of North Carolina Hospitals at Chapel Hillincumbent as of October 31, 1998, with their terms of membership on the boardof directors of the University of North Carolina Health Care System to expireon the last day of October of the year in which their term as a member of theboard of directors of the University of North Carolina Hospitals at Chapel Hillwould have expired. Vacant at‑large positions shall be filled by theappointment of persons from the business and professional public at large whohave special competence in business management, hospital administration, healthcare delivery, or medical practice or who otherwise have demonstrateddedication to the improvement of health care in North Carolina, and who areneither members of the Board of Governors, members of the board of trustees ofa constituent institution of The University of North Carolina, nor officers oremployees of the State. Members shall be appointed by the President of theUniversity, and ratified by the Board of Governors, from among a slate ofnominations made by the board of directors of the University of North CarolinaHealth Care System, said slate to include at least twice as many nominees asthere are vacant positions to be filled. No member may be appointed to morethan two full four‑year terms in succession; provided, that personsholding appointed memberships on November 1, 1998, by virtue of their previousmembership on the board of directors of the University of North CarolinaHospitals at Chapel Hill, shall not be eligible, for a period of one yearfollowing expiration of their term, to be reappointed to the board of directorsof the University of North Carolina Health Care System. Any vacancy in anunexpired term shall be filled by an appointment made by the President, andratified by the Board of Governors, upon the nomination of the board ofdirectors, for the balance of the term remaining.
(2) The board ofdirectors, with each ex officio and at‑large member having a vote, shallelect a chairman from among the at‑large members, for a term of twoyears; no person shall be eligible to serve as chairman for more than threeterms in succession.
(3) The board ofdirectors of the University of North Carolina Health Care System shall meet atleast every 60 days and may hold special meetings at any time and place withinthe State at the call of the chairman. Board members, other than ex officiomembers, shall receive the same per diem and reimbursement for travel expensesas members of the State boards and commissions generally.
(4) In meeting thepatient‑care, educational, research, and public‑service goals ofthe University of North Carolina Health Care System, the board of directors isauthorized to exercise such authority and responsibility and adopt suchpolicies, rules, and regulations as it deems necessary and appropriate, notinconsistent with the provisions of this section or the policies of the Boardof Governors. The board may authorize any component of the University of NorthCarolina Health Care System, including the University of North CarolinaHospitals at Chapel Hill, to contract in its individual capacity, subject tosuch policies and procedures as the board of directors may direct. The board ofdirectors may enter into formal agreements with the University of NorthCarolina at Chapel Hill with respect to the provision of clinical experiencefor students and for the provision of maintenance and supporting services. Theboard's action on matters within its jurisdiction is final, except that appealsmay be made, in writing, to the Board of Governors with a copy of the appeal tothe Chancellor of the University of North Carolina at Chapel Hill. The board ofdirectors shall keep the Board of Governors and the board of trustees of theUniversity of North Carolina at Chapel Hill fully informed about health carepolicy and recommend changes necessary to maintain adequate health caredelivery, education, and research for improvement of the health of the citizensof North Carolina.
(c) Officers.
(1) The executive andadministrative head of the University of North Carolina Health Care Systemshall have the title of "Chief Executive Officer." The board ofdirectors, in cooperation with the board of trustees and the Chancellor of theUniversity of North Carolina at Chapel Hill, following such search process asthe boards and the Chancellor deem appropriate, shall identify, in cooperationwith the Chancellor, two or more persons as candidates for the office, who,pursuant to criteria agreed upon by the boards and the Chancellor, have thequalifications for both the positions of Chief Executive Officer and Vice‑Chancellorfor Medical Affairs of the University of North Carolina at Chapel Hill. Thenames of the candidates so identified shall be forwarded by the Chancellor tothe President of The University of North Carolina, who if satisfied with thequality of one or more of the candidates, will nominate one as Chief ExecutiveOfficer, subject to selection by the Board of Governors. The Chief ExecutiveOfficer shall have complete executive and administrative authority to formulateproposals for, recommend the adoption of, and implement policies governing theprograms and activities of the University of North Carolina Health Care System,subject to all requirements of the board of directors.
(2) The executive andadministrative head of the University of North Carolina Hospitals at ChapelHill shall have the title of "President of the University of NorthCarolina Hospitals at Chapel Hill."
(3) The board ofdirectors shall elect, on nomination of the Chief Executive Officer, thePresident of the University of North Carolina Hospitals at Chapel Hill, andsuch additional administrative and professional staff employees as may bedeemed necessary to assist in fulfilling the duties of the office of the ChiefExecutive Officer, all of whom shall serve at the pleasure of the ChiefExecutive Officer.
(d) Personnel. Employeesof the University of North Carolina Health Care System shall be deemed to beemployees of the State and shall be subject to all provisions of State lawrelevant thereto; provided, however, that except as to the provisions ofArticles 5, 6, 7, and 14 of Chapter 126 of the General Statutes, the provisionsof Chapter 126 shall not apply to employees of the University of North CarolinaHealth Care System, and the policies and procedures governing the terms andconditions of employment of such employees shall be adopted by the board ofdirectors; provided, that with respect to such employees as may be members ofthe faculty of the University of North Carolina at Chapel Hill, no suchpolicies and procedures may be inconsistent with policies established by, or adoptedpursuant to delegation from, the Board of Governors of The University of NorthCarolina.
(1) The board ofdirectors shall fix or approve the schedules of pay, expense allowances, andother compensation and adopt position classification plans for employees of theUniversity of North Carolina Health Care System.
(2) The board ofdirectors may adopt or provide for rules and regulations concerning, but notlimited to, annual leave, sick leave, special leave with full pay or withpartial pay supplementing workers' compensation payments for employees injuredin accidents arising out of and in the course of employment, workingconditions, service awards and incentive award programs, grounds for dismissal,demotion, or discipline, other personnel policies, and any other measures thatpromote the hiring and retention of capable, diligent, and effective careeremployees. However, an employee who has achieved career State employee statusas defined by G.S. 126‑1.1 by October 31, 1998, shall not have his or hercompensation reduced as a result of this subdivision. Further, an employee whohas achieved career State employee status as defined by G.S. 126‑1.1 byOctober 31, 1998, shall be subject to the rules regarding discipline ordischarge that were effective on October 31, 1998, and shall not be subject tothe rules regarding discipline or discharge adopted after October 31, 1998.
(3) The board ofdirectors may prescribe the office hours, workdays, and holidays to be observedby the various offices and departments of the University of North CarolinaHealth Care System.
(4) The board ofdirectors may establish boards, committees, or councils to conduct hearingsupon the appeal of employees who have been suspended, demoted, otherwisedisciplined, or discharged, to hear employee grievances, or to undertake anyother duties relating to personnel administration that the board of directorsmay direct.
The board of directors shallsubmit all initial classification and pay plans and other rules and regulationsadopted pursuant to subdivisions (1) through (4) of this subsection to theOffice of State Personnel for review upon adoption by the board. Any subsequentchanges to these plans, rules, and policies adopted by the board shall besubmitted to the Office of State Personnel for review. Any comments by theOffice of State Personnel shall be submitted to the Chief Executive Officer andto the President of The University of North Carolina.
(e) Finances. TheUniversity of North Carolina Health Care System shall be subject to theprovisions of the State Budget Act, except for trust funds as provided in G.S.116‑36.1 and G.S. 116‑37.2. The Chief Executive Officer, subject tothe board of directors, shall be responsible for all aspects of budgetpreparation, budget execution, and expenditure reporting. All operating fundsof the University of North Carolina Health Care System may be budgeted anddisbursed through special fund codes, maintaining separate auditable accountsfor the University of North Carolina Hospitals at Chapel Hill and the clinicalpatient care programs of the School of Medicine of the University of NorthCarolina at Chapel Hill. All receipts of the University of North CarolinaHealth Care System may be deposited directly to the special fund codes, andexcept for General Fund appropriations, all receipts of the University of NorthCarolina Hospitals at Chapel Hill may be invested pursuant to G.S. 147‑69.2(b3).General Fund appropriations for support of the University of North CarolinaHospitals at Chapel Hill shall be budgeted in a General Fund code under asingle purpose, "Contribution to University of North Carolina Hospitals atChapel Hill Operations" and be transferable to a special fund operatingcode as receipts.
(f) Finances Patient/HealthCare System Benefit. The Chief Executive Officer of the University of NorthCarolina Health Care System, or the Chief Executive Officer's designee, mayexpend operating budget funds, including State funds, of the University ofNorth Carolina Health Care System for the direct benefit of a patient, when, inthe judgment of the Chief Executive Officer or the Chief Executive Officer'sdesignee, the expenditure of these funds would result in a financial benefit tothe University of North Carolina Health Care System. Any such expenditures aredeclared to result in the provision of medical services and create charges ofthe University of North Carolina Health Care System for which the health caresystem may bill and pursue recovery in the same way as allowed by law forrecovery of other health care systems' charges for services that are unpaid.
These expenditures shall berestricted (i) to situations in which a patient is financially unable to affordambulance or other transportation for discharge; (ii) to afford placement in anafter‑care facility; (iii) to assure availability of a bed in an after‑carefacility after discharge from the hospitals; (iv) to secure equipment or othermedically appropriate services after discharge; or (v) to pay health insurancepremiums. The Chief Executive Officer or the Chief Executive Officer's designeeshall reevaluate at least once a month the cost‑effectiveness of anycontinuing payment on behalf of a patient.
To the extent that theUniversity of North Carolina Health Care System advances anticipated governmententitlement benefits for a patient's benefit, for which the patient laterreceives a lump‑sum "back‑pay" award from an agency ofthe State, whether for the current admission or subsequent admission, the Stateagency shall withhold from this back pay an amount equal to the sum advanced onthe patient's behalf by the University of North Carolina Health Care System,if, prior to the disbursement of the back pay, the applicable State program hasreceived notice from the University of North Carolina Health Care System of theadvancement.
(g) Reports. TheChief Executive Officer and the President of The University of North Carolinajointly shall report by September 30 of each year on the operations andfinancial affairs of the University of North Carolina Health Care System to theJoint Legislative Commission on Governmental Operations. The report shallinclude the actions taken by the board of directors under the authority grantedin subsections (d), (h), (i), and (j) of this section.
(h) Purchases. Notwithstandingthe provisions of Articles 3, 3A, and 3C of Chapter 143 of the General Statutesto the contrary, the board of directors shall establish policies andregulations governing the purchasing requirements of the University of NorthCarolina Health Care System. These policies and regulations shall provide forrequests for proposals, competitive bidding, or purchasing by means other thancompetitive bidding, contract negotiations, and contract awards for purchasingsupplies, materials, equipment, and services which are necessary andappropriate to fulfill the clinical, educational, research, and communityservice missions of the University of North Carolina Health Care System. Theboard of directors shall submit all initial policies and regulations adoptedpursuant to this subsection to the Division of Purchase and Contract for reviewupon adoption by the board. Any subsequent changes to these policies andregulations adopted by the board shall be submitted to the Division of Purchaseand Contract for review. Any comments by the Division of Purchase and Contractshall be submitted to the Chief Executive Officer and to the President of TheUniversity of North Carolina.
(i) Property. Theboard of directors shall establish rules and regulations for acquiring ordisposing of any interest in real property for the use of the University ofNorth Carolina Health Care System. These rules and regulations shall includeprovisions for development of specifications, advertisement, and negotiationswith owners for acquisition by purchase, gift, lease, or rental, but not bycondemnation or exercise of eminent domain, on behalf of the University ofNorth Carolina Health Care System. This section does not authorize the board ofdirectors to encumber real property. The board of directors shall submit allinitial policies and regulations adopted pursuant to this subsection to theState Property Office for review upon adoption by the board. Any subsequentchanges to these policies and regulations adopted by the board shall besubmitted to the State Property Office for review. Any comments by the StateProperty Office shall be submitted to the Chief Executive Officer and to thePresident of The University of North Carolina. After review by the AttorneyGeneral as to form and after the consummation of any such acquisition, theUniversity of North Carolina Health Care System shall promptly file a reportconcerning the acquisition or disposition with the Governor and Council ofState. Acquisitions and dispositions of any interest in real property pursuantto this section shall not be subject to the provisions of Article 36 of Chapter143 of the General Statutes or the provisions of Chapter 146 of the GeneralStatutes.
(j) Property Construction. Notwithstanding G.S. 143‑341(3) and G.S. 143‑135.1, the board ofdirectors shall adopt policies and procedures with respect to the design,construction, and renovation of buildings, utilities, and other propertydevelopments of the University of North Carolina Health Care System requiringthe expenditure of public money for:
(1) Conducting the feenegotiations for all design contracts and supervising the letting of allconstruction and design contracts.
(2) Performing theduties of the Department of Administration, the Office of State Construction,and the State Building Commission under G.S. 133‑1.1(d), Article 8 ofChapter 143 of the General Statutes, and G.S. 143‑341(3).
(3) Using open‑enddesign agreements.
(4) As appropriate,submitting construction documents for review and approval by the Department ofInsurance and the Division of Health Service Regulation of the Department ofHealth and Human Services.
(5) Using the standardcontracts for design and construction currently in use for State capitalimprovement projects by the Office of State Construction of the Department ofAdministration.
The board of directors shallsubmit all initial policies and procedures adopted under this subsection to theOffice of State Construction for review upon adoption by the board. Anysubsequent changes to these policies and procedures adopted by the board shallbe submitted to the Office of State Construction for review. Any comments bythe Office of State Construction shall be submitted to the Chief ExecutiveOfficer and to the President of The University of North Carolina.
(k) PatientInformation. The University of North Carolina Health Care System shall, atthe earliest possible opportunity, specifically make a verbal and writtenrequest to each patient to disclose the patient's social security number, ifany. If the patient does not disclose that number, the University of NorthCarolina Health Care System shall deny benefits, rights, and privileges of theUniversity of North Carolina Health Care System to the patient as soon aspractical, to the maximum extent permitted by federal law or federalregulations. The University of North Carolina Health Care System shall make thedisclosure to the patient required by Section 7(b) of P.L. 93‑579. Thissubsection is supplementary to G.S. 105A‑3(c). (1971, c. 762, s. 1; c. 1244,s. 6; 1981, c. 859, s. 41.5; 1983, c. 717, s. 32; 1985 (Reg. Sess., 1986), c.955, ss. 30, 31; 1989, c. 141, s. 1; 1991, c. 550, s. 2; c. 689, s. 206.2(d);1993 (Reg. Sess., 1994), c. 591, s. 10(a); 1998‑212, s. 11.8(a); 1999‑252,s. 4(a); 2005‑417, s. 3; 2006‑203, s. 47.2; 2007‑182, s. 1;2007‑306, s. 1.)