RICK GILSTRAP
CEO
Halifax Regional Medical Center

January 20, 2000

Interviewer: John Stillerman, Administrative Resident - PCMH

John Stillerman: Mr. Gilstrap, we will begin by you telling us a little about your background - where you are from and how you got into health care.

Rick Gilstrap: I am originally from Charleston, South Carolina. Went to Furman University where I received degrees in Business Administration and Economics. Went straight from there to Medical College of Virginia and graduated with a Masters in Hospital Administration. Then did an Administrative Residency of one year at St. Luke's Hospital, McGuire Clinic, in Richmond, Virginia. Following that I was supposed to go into the Army but failed my physical and at the age of 24 I took a job as Administrator of Woodruff Hospital, a small hospital in Woodruff, South Carolina. At that point in time it was decided that I could meet the Army's medical standards and I went into the Army where I was a Medical Service Corps officer. For one year I was at Fort Jackson in South Carolina and the next year I was in the Medical Command Headquarters in Vietnam. In 1971 I got out of the Army and was hired as an Assistant Administrator at Pitt County Memorial Hospital.

As I remember back, I think I was there for 11-1/2 years. For the first three years I was Assistant Administrator and for four years I was the Associate Director, the next four years I was Executive Director and for the last period of time I was there I served as the Senior Vice President. When I first went to PCMH it was about a 206 bed hospital and in 1977 we moved patients to the new PCMH which is now 23 years old where we went to a 370 bed hospital. We moved there and the growth was such that by 1979 it had grown to 569 beds.

It was very interesting when we began partnering with the ECU School of Medicine. It was very different since there had not been a lot of medical specialization in that area. It had been a community hospital and in the late 1960s there had been some specialties and then when the medical school came it grew into such an exciting period of time. Everything we were reading about in journals we were doing at that time. We couldn't go to a meeting anywhere but that something they were doing we were not already doing too.

The hospital was a County hospital solely owned by the County and run as a non-profit organization. For the first six months I was at PCMH, C. D. Ward, who had been the previous Administrator, still had an office in the building. Jack Richardson was the present Administrator. For the period of time I was at PCMH, Jack Richardson was my boss. He let me do many things and we tried things out and he let all of us make many decisions. In doing that you do make a lot of mistakes and learn by them. I guess one of the most difficult things is that there was no history or track to follow in the relationship with the medical school. Nobody had ever done that before, as far as we knew. We didn't know exactly what they should or we should do and we wanted to work together but we were sort of at arm's length because you didn't want to take advantage of them and we didn't want them to take advantage of us. As we both grew and came closer to one entity it worked out into a reasonably good relationship between the hospital and the medical school.

When I was there, the old hospital building, which is now the Pitt County Office Building, was a Hill Burton hospital and it was a good hospital and there were probably about six or seven of them in the state under that same plan. You could ride around to Elizabeth City, Albemarle, and several other places and they had the exact same hospitals and I think the hospital was started in 1948 and completed in 1952, somewhere in that period of time. In 1977 the hospital moved out of the old hospital into the present site. I was a young Administrator and I wanted to do some things my way and I had a boss who didn't always agree with me so I was offered job to come to Halifax Hospital in Roanoke Rapids. In the fall of 1982 I took the job at Halifax and I have been here for almost 17-1/2 years. Halifax is about the same size Pitt was when I first went there which is about 206 beds and Halifax is now a private hospital owned by itself and has changed its name to Halifax Regional Medical Center. We are an affiliate of PCMH and are really not sure what that means other than that down the road we will work together and are talking about working together on a Wellness Center and we do have the Wellness program together.

I still have many friends and contemporaries at PCMH. They keep me informed as to what is going on and about the exciting things they are doing there.

Halifax Hospital is a rural hospital and we are in one of the poorest counties in the state. We take care of two county areas, Halifax and Northampton, and we have about a $120 million revenue budget a year and about 70 doctors and 850 employees. We are trying to stay in business just like most of the other hospitals under the Balanced Budget Act that has hit us quite strongly. We have a very high percentage of Medicare and Medicaid, about 73% between the two of them. Halifax County has by far the highest percentage of food stamps given its population and that kind of tells you about the finances of the area.

John Stillerman: I would like to go back just a little bit when you were at PCMH during the years you were there. What were the biggest developments-I guess they would be the move from the old hospital to the new facility-what did you see Pitt doing for the community at that time and what was their role in the community and how has it changed during the time that you were there?

Rick Gilstrap: I think that the new hospital was one of the most important, but I also think that the development of the new medical school was also one. What we tried to do was to be patient, focused and we had a community Board that tied us in with the community and tried to provide the needs that they had. For a number of years, farming was the main industry they had and that was the main driving thing. Over the years with the evolution of the medical component it became one of the largest financial ports. It also provided services close to home and one of the most successful first ones was the Regional Rehabilitation Center. The people with rehab type problems did have a place to go that was close to home and they did recover and people could come and work with and visit with patients. I guess the saving of lives with the trauma development, the ED development and the Neonatal Intensive Care Unit which saved the lives of those babies who wouldn't have made it otherwise. I think it gave the community a rallying point that where these people never had something they now had this to be proud of and brag about. Historically, the Piedmont area of the State of North Carolina had always had about all the gravy, so to speak, and now there was something that was not in the Central part of the state that was a model and was accessible. To the people of Pitt County, it showed a very good investment that they made when they voted to build the initial hospital. The return on their investment has just been tremendous and has been a good financial investment. Another thing is that the hospital has had so many leaders and they permeate through the Chamber of Commerce, United Way, school boards, and many others and that through these people they give back to the community.

John Stillerman: Who or what do you attribute the success in the 1970s when Pitt County started moving from the community hospital to a tertiary center? How did that happen?

Rick Gilstrap: From my perspective, Jack Richardson was the President of the hospital and Dr. Bill Laupus was Dean of the medical school. I think that both of them had the perfect egos. They were not there for self pride but were there to make things better so they were both able to give something and not inclined to show somebody up. They worked real well together which enabled both to reach their fulfillment. I don't think the medical school would have been going if it hadn't been for Leo Jenkins. He was the grandfather, godfather or whatever in getting the medical school there. But, from inside the hospital and inside the medical school, Jack Richardson and Bill Laupus were the people who did great things and made things work. I don't mean to hurt anyone's feelings on the staff and I could name several of a hundred people who did important things but I would say that these two would be at the head of the class. You have to be very careful with the politicians who supported the hospital and the Board members who pushed it since if any one of those people had said no, then it could have kept the success from happening. When you start listing people you have to be very careful. I admire all of them but those are the two I would pick.

John Stillerman: What do you think the major obstacles were in the 1970s when they were trying to build this?

Rick Gilstrap: Well, the power for the medical school, the power for the funding, it was in the State Legislature and that was an obstacle. They didn't want to give anything out here in the "sticks" where nothing had ever been before and so that was something. They had never done this before and in little Greenville how could you have a medical center that's nation-wide acceptable and the recruitment of all of these people Took time. If you think, most physicians have gone to college, medical school and done residencies in large cities and so for a minimum of 12 years they have lived in large cities and then you try to get them, and even more important, their spouses, to move to a rural area where there is no opera, ballet, or many things they had in the city that was kind of a difficult thing for them. In the early years we had some problems with some people we recruited, and I learned a whole lot from that. If you recruit somebody and they are not happy, they are going to share that and if they feel that they were told something was going to be there and it is not then they will be unhappy so probably that was a good learning experience.

John Stillerman: We talked about Mr. Richardson and Dr. Laupus kind of being the people behind all of this. What was the mood of the city at the time? Can you elaborate of what sort of moods were at the hospital?

Rick Gilstrap: Well, during that period of time, health care was not as big a business. I can remember when I first went to school the goal of a hospital was to break even. A lot of people felt that when you lost any money you were a poor manager and if you made any money you were gouging the public. So a lot of people set their budget for zero bottom line, no margin, and so that was kind of looked at with not much business input into it. It was more of a service type thing. The evolution of introducing the business concept to health care is one of things that has allowed it to grow and be successful. In early time the community was kind of like they felt their taxes were going over there to pay for that hospital and was that the hospital was doing a good job but it was not viewed in the same light by the community as it is now.

John Stillerman: Can you talk a little bit about how the community viewed the hospital then and how it views it now and how that perception has changed?

Rick Gilstrap: Well, I think that early on it was why would we expect to have something real good like this in Greenville-if I'm going to get expensive care I am going to go to Wilson or Raleigh, Durham or Chapel Hill and I think now it is just the opposite. People from all over the East think that if they are going to get really expensive specialized care, I'm going to go to Greenville for it. That has been an evolution in the idea process. Back in 1965 you wouldn't have people from most of the eastern areas sending patients to Pitt County. The best thing, if you looked in 1972, the percentage of patients that came from Pitt County and you looked in 1999, the percentage from Pitt County, that will probably show you as much as anything the change in the regional mission.

I would like to say that Dave McRae has worked very hard in continuing that regional nature because there were some rough years when a lot of hospitals' census went down. Doctors and hospitals said that those turkeys in Greenville are getting all of our patients and we are not doing as well because they are getting all of our patients. He worked real hard to assist these other hospitals in doing whatever it needed to be done for them in order for them to be successful.

John Stillerman: Do you think that as Pitt has grown we have done a good job of keeping community hospitals involved in the system?

Rick Gilstrap: Yes I do and I think that the mission has changed. The mission in 1971 was to take care of people in Pitt County while the mission now is to take care of people throughout the region. That's my interpretation of the mission. That is a big change because in 1971 had they tried to do that, they would want to know what do we mean by taking their money that they paid for the hospital and letting somebody from X,Y,Z county come in here and use our hospital and now they realize that this is part of our mission and actually they are also bringing finances here to help us subsidize some of the care for some of our own patients.

John Stillerman: What do you think will be the challenges for Pitt in the future?

Rick Gilstrap: I think that number one like all the rest of the hospitals, staying in business with government reimbursement. It is easy for somebody to write a law in Washington which would take $30 million a year out of Pitt Hospital and I think that is a major one. I think that for Pitt to decide exactly how they are going to relate to the rest of these hospitals. They have three or four different relationships with five or six different hospitals. Some of the other ones they don't have any relationships with. How are those going to tie in and how the are doctors going to tie in with the local communities. Still in Pitt County you have got your town and gown, you have your medical school doctors and you have your private practitioners and their goals aren't the same and I think that has to be woven together somewhat so that they aren't competing with each other outside of the facility. I also think that this probably isn't for provocation but I think that there needs to be some healing between the county commissioners and Pitt County Memorial Hospital. There is a scar there and it needs to be resolved. That is something that is taking a lot of their energy.

John Stillerman: At the state level, how do you think Pitt is seen?

Rick Gilstrap: I think Pitt is seen on the same level with the other teaching hospitals and the big hospital system in Charlotte. The five of those are seen as the top and I think the resources and quality, success and programs speak for themselves. People outside of this region know that they have got some real exciting things going on there.

John Stillerman: Are there any kind of little known facts or unique incidents that you would like to share with us?

Rick Gilstrap: Well, in the period of time that I was there and since then, I have tried to have a good time with the people there. I have made a lot of friends and have learned a whole lot and I guess that it is my mistake and I hope they don't hold it against me and my successes and I hope they don't forget. No, I think that when Jack Richardson retired a few years ago we had kind of a "dog and pony" show in which there was a semi-roast for him. We told a number of funny stories but I think if you will look at how many senior managers they have had who have been there for a long time, then that kind of helps their history of why they have done so well. Dave McRae has been there for a long time, Buck Sitterson, Ralph Hall, Deborah Davis. Jim Ross is moving into that category. Charles Fennessy was there for a long time. It appears that they are getting young people into positions that when the people who have been there for a long time, the philosophies that they have felt are not forgotten. I won't have a funny story or a should be remember thing other than I can just say that when we were getting ready to build the hospital and we went out there a got in that corn field and walked across it and some of the people said it was such a shame to tear down such a nice corn field and build a hospital over here. I guess the relationship with the Board Chairmen who have been there has been wonderful. They have wanted the hospital to be successful and have given time and energy. I think it is a wonderful case study for somebody to show how hospitals go from so many beds to more beds. I had two of my daughters born in that hospital so I have some wonderful memories from that perspective. I learned so much from doctors who were practicing there and not all of it was from a positive point of view but as you build your personal database you learn different things so there has been a wonderful array of experiences. Just the friends that I have made are invaluable.

John Stillerman: Halifax is an affiliate of PCMH right now? Exactly what does that mean or are you still fishing for that? What kind of relationship do you have with Pitt with the Affiliation Agreement?

Rick Gilstrap: You asked me to describe our Affiliation Agreement in relationship with Pitt. I just think it means that we are good friends and we will work together, and if there is something that they can do to help us or we can do to help them, that we will probably go in that direction. It's non-exclusive and eventually I will probably have Affiliation Agreements with some other areas. I like to be able to do more with Pitt but we just haven't been able to develop some of the things. As I said earlier, two things that we do have is that we have our Wellness Program, ViQuest through Pitt and we are building a Wellness Center and they will be a joint partner with us in that. I think that nobody really knows what it will evolve into and it is a very loose thing, I think from our perspective that Pitt will put some money into our Wellness Center and this allows them to go to their Board and say that we have this agreement.

John Stillerman: What do you think the future holds for Pitt?

Rick Gilstrap: Pitt is kind of the big hospital in this area and when they move it affects a whole lot of other hospitals. I think Pitt has some things that they are doing extremely well and I think they are on a learning curve right now. I see them probably having more relationships with other hospitals. I think that there needs to be some type of a closer relationship between Pitt, the medical school and private practitioners, the doctors and the entities. Equal distance between Pitt, ECU, Wake, Duke, MCV and eastern Virginia medical schools and just a little further to Chapel Hill and we don't get a whole lot of relationships from any of them. We would like to have more of a relationship through the AHEC system. We are in the UNC AHEC along with Heritage, Wake and Wilson and Nash . Several times they have been up and talked with us about special projects. We do have one of the Pitt intensive care ambulances housed in our town. I would see it would evolve more and Pitt's tentacles would expand more over the years and Pitt has to be able to justify that at home and the hospital and the community they are going into has to be able to justify that locally in their community. Most hospitals don't want outside input in running their local hospitals. Some of the ones that Pitt has relations with have had some problems and Pitt is helping them in solving these problems. The ones who have relations with them maybe already admit they have those problems. We and a whole lot of hospitals down I-95 are independent as far as we are not members of any chain or group like that and we have to see how it would benefit us to go into a situation like that.

John Stillerman: Do you have any parting shots, any last words?

Rick Gilstrap: No, I think that it has served Pitt and ECU School of Medicine well to continue to keep an ear close to the ground and find out what the needs are of the health communities outside of Pitt County. They need to try to continue to provide those and to try to develop a way that a good percentage of their graduates study in this area so they will have those feed backs. We don't have very many up here who graduated from ECU and Pitt programs but that is where you get the referrals back. Referrals are what drives the machine. I would just say to stay the course. They have been very ethical, honest, have not played any games and they have helped our people when they have needed help.