The Plan to Enlarge PCMH

           Pitt County Memorial Hospital had admitted about 56,000 patients by the time its tenth anniversary came in 1961. An article in The Daily Reflector commented on the growth in hospital personnel to 185, adding, “and one day, in the projected future, the staff will be something like 300 persons.” 

           In a special referendum that had been held in September 1958, a hospital bond issue of $750,000 was passed to cover enlarging and improving PCMH. Federal funds of $923,400 brought the total cost of the project to about $1.6 million.

           Excavation began in July 1959 on the first addition, a one-story wing at the west end of the existing four-story hospital. It would provide an addition to the emergency area, in which a new 100 KVA transformer bank would be installed; this would supplement the existing bank to supply emergency power to the entire building. The new one-story wing would also house a new emergency room with two treatment rooms, each with two treatment tables. Three observation beds were to be added, and three X-ray rooms. There were also a new staff lounge, an outpatient waiting room, and an observation room with four beds.

           The X-ray department would expand into the second added wing, with an office and viewing room, a film storage room, two diagnostic rooms, and a deep therapy room. The space that had been occupied by the staff lounge was to be used for laboratory expansion. The basement of the two-story wing would house a new kitchen, food storage compartments, a cafeteria, two dining rooms, and ice machines, as well as a physical therapy room and an exercise room. The old kitchen space on the second floor of the existing building would be converted to a third major operating room, a sterilizing room, and an operating room for dental surgery.

           A four-story, 80-bed wing was to be built behind the existing building. The second phase of construction was still under way in February 1961, to bring the number of beds to 200. Laboratory space would be doubled, the entire hospital would be air-conditioned, the heating system converted from coal to fuel oil and natural gas, and an additional elevator installed.

          What was known as the “Negro” division of the hospital was to be expanded on the first floor of the addition, the size of the coffee shop doubled in size, and a chapel added. The Greenville Service League had pledged to equip the small chapel, in cooperation with the Greenville Ministerial Association, and pay for enlarging the coffee shop. The whole second floor would be used for surgical patients, with a six-bed recovery room. Where the new wing joined the existing hospital, a doctor’s dressing room and lounge would be added.

          Twenty-six beds for obstetrical patients were to be added on the third floor, and the pediatrics section moved to the fourth floor, with 25 beds. There would be 45 beds for general medical patients on the third and fourth floors of the existing hospital.

          Other additions were a physical therapy department, a new call system with an intercom at the head of each bed connected to the nurses’ station, and enlarged parking facilities.

          By the early 1960s Pitt Memorial was one of the best equipped hospitals in the state, and one of the largest east of Raleigh, but it was no longer adequate for the county’s needs. Where the national average was 42 beds per 1,000, Pitt County had only 105 for a population of 69,000, or less than two beds per 1,000. The hospital should have had more than 300 beds.

          In September 1961, another step was taken toward expanding the hospital, when the county commissioners considered the hospital trustees’ request to purchase an additional 15 acres of land on the south and west sides of the tract that the Moye family had donated. After two months of deliberation by its planning committee, the board approved the purchase of 12 acres. They “felt assured the land would be adequate for reasonable expansion of the county medical facility within the foreseeable future,” the Daily Reflector reported.

          The need was clear to the physicians practicing at the hospital and to its trustees, but the public was not prepared to act. Pitt County voters on June 8, 1963, defeated by a vote of 1,748 to 778 the proposal to increase the county’s special tax for support of the hospital from $0.54 per $100 of property evaluation to $1.04 per $100. The request for an increase in the level of support had been initiated by the board of trustees because of a $30,000 deficit in the hospital’s balance sheet resulting from unpaid patient accounts. The board, noting that April had shown a loss but that during May the hospital had no loss, decided to hire an outside bill collector to supplement the work of the hospital credit manager’s office.

          The Service League of Greenville continued with unflagging support. It donated $4,500 toward the cost of the new critical care unit that the hospital was preparing to open in the fall. The unit would have four beds and a specially trained nurse always on duty in the room.

Desegregation

           Since the opening of the hospital, there had been two separate patient entrances, with the “white” entrance located in front of the building where it was convenient to drive up and walk in, and the “colored” entrance around in the back of the building, at the top of a short flight of steps.

           All facilities at Pitt County Memorial Hospital were desegregated on Monday, May 24, 1965, to avoid losing federal funds, which amounted to about $250,000 a year. No discrimination because of race, color, or national origin would be practiced in the hospital toward patients or employees. No dining room facility would be designated by race. All references to race were eliminated from existing or future hospital records. The entrances and associated waiting rooms were consolidated, and the “colored waiting room” converted to an office.

          There were 130 African-Americans employed by the hospital at the time, or 42 percent of the total number of personnel.

Medicare Arrives

           The advent of Medicare in 1966 transformed the financing of medical treatment. Medicare largely funded the growth of the hospital over the next 17 years, until Diagnosis Related Groups, or DRGs, cut the level of reimbursement. When it started, Administrator C. D. Ward anticipated that there might be some misunderstandings in the community about the Medicare requirement that patients pay the initial $40 of their bill when they were admitted to the hospital and about the other deductibles and copayments they would have to pay later on. However, no problems occurred at PCMH when the Medicare program of benefits for healthcare to the elderly was instituted on July 1, 1966.

          Jack Richardson, who joined the hospital administration just before Medicare took effect, commented in an interview on May 22, 2000, that the doctors practicing at PCMH took the lead in accepting Medicare assignments in eastern North Carolina, in contrast with many other physicians in the area. The willingness of the hospital medical staff to accept Medicare patients was widely known. It resulted in an increase in the number of patients who came from other areas to Greenville for medical care, greatly benefiting the hospital’s long-term growth.

Splitting the Seams Again

          This growth created a need for hospital leaders to plot a course for future expansion. On February 1, 1967, the board of trustees commissioned a survey of the hospital’s service area to identify the immediate and long-term demands for expansion.

          As a part of this survey, the hospital trustees and medical staff, as well as professional and business leaders in Greenville and Pitt County, met in August to discuss the hospital’s intensifying space problems. The average occupancy ran above 80 percent, and up to 95 percent in the medical and surgical floors; at times, occupancy ran so high that patient beds had to be placed in the corridors.

          The hospital was not only starved for space, but also for money. Its financial operations were hand-to-mouth, and it depended on immediate income for working expenses. At the time, Blue Cross was the intermediary for Medicare, processing claims for the government. This amounted to 35 or 36 percent of the hospital’s income. Since it took two weeks or more to process Medicare claims, accounts often became payable before the money had been received to cover them. The situation was particularly uncertain where the payroll was concerned, since Ward had to wait for the Medicare checks from Blue Cross before he could make out checks for the employees, and often had to hold checks made out to vendors until enough cash was accumulated to pay them. There was never much of a balance in the bank account.

          T.B. “Buck” Sitterson, who was Ward’s assistant at the time, on one occasion reported that the time came around to pay the employees, who were paid every two weeks. The bank account was virtually empty. Sitterson called a Blue Cross representative whom he knew well and asked whether he could bring some claims to the Blue Cross office in Durham and have them processed right away. This was possible, so he took a briefcase full of claims to Durham, and the claims office took some people from other work and assigned them to processing Pitt Memorial’s reimbursements. They processed the claim forms, and wrote a check for about $20,000. Sitterson put the check in his pocket and carried it back to Greenville. It was just a little more than enough to cover the payroll. The employees never knew how close they came to not being paid.

          Before making any decision on expanding the hospital, the board of trustees waited for the findings of a feasibility study by Charles P. Cardwell from the School of Hospital Administration at the Medical College of Virginia in Richmond and A. Gibson Howell, also from MCV. They set a deadline of April 1968 for delivery of the completed survey.

          The survey recommended immediate expansion from 205 to 305 beds by adding 100 private rooms mostly for adult medical and surgical patients. Along with the enlarged support services, this would necessitate a new building. Enough acreage had been added to the 17 original acres so that there was ample room for new construction. The consultants recommended that the hospital retain flexibility in further expansion, and consider the development of the East Carolina University School of Medicine and paramedical programs taught in the hospital and at Pitt Community College.

          In May 1968, the board engaged the architectural firm of Freeman-White Associates of Charlotte to design an architectural plan for expansion. In November, the Joint Committee met to consider purchasing land around the hospital.

          On August, 19, 1968, in a letter to Dr. Eric L. Fearrington, a member of the hospital staff with whom he had been associated in his practice, Dr. Monroe summarized the recommendations he had made to the hospital architect. He emphasized the importance of providing for future expansion and planning for a comprehensive health complex to which the hospital would be central.

          Cardwell met on January 13 with the joint conference committee of the Pitt County Board of Commissioners, the hospital administration, and the hospital medical staff. He had requested the meeting to discuss outpatient clinics and possible involvement in educational programs. After a long discussion, the group agreed that, while the primary responsibility of the hospital was to provide good medical care to the area, they were “willing and even eager to negotiate with any established educational institution in working out an affiliation to use the hospital for clinical experience of their students.” The group insisted that such an affiliation must not pose any financial burden on patients or taxpayers, and should build on the programs already being conducted within the hospital.

          The board instructed the consultants and the architects to include educational facilities in their plans: conference rooms, lecture rooms, and a large auditorium. The medical staff accepted the provision of outpatient services as an irreversible trend, even though they did not fully agree that such services were appropriate for a hospital. They agreed to keep communication open between the hospital and East Carolina University and to discuss any proposed programs that might be mutually beneficial.

          In February 1969, Freeman-White proposed four alternative designs for expansion. Scheme “A” proposed renovating and expanding each department of the hospital where it was, with as little new construction as possible. There were many disadvantages to this alternative, including interruptions of service by the construction, which would take considerable time. Also, this approach, which would cost about $7 million, would make further expansion almost impossible.

          Scheme “B” included relocating many departments to a new addition, with minimum renovation to the existing structure. Divisions that needed little refurbishing could then reoccupy the space that had been used by the relocated functions. Long corridors connected by ramps with varying slopes would connect the new addition to the older construction. The consultants estimated the cost of this plan at $7.3 million.

          Ironically, Scheme “C” was not proposed, but included only for comparison. It examined the possibility that had been put aside as probably too expensive to manage: building an entirely new building with 300 private rooms, and making the old building into a long-term care facility, or converting it into a county office building. The cost would be about $10.7 million.

          Scheme “D” was for a new 300-bed hospital with 65-75 percent private rooms, and the rest semi-private, at a cost of $9.09 million.

          Consultant Cardwell supported Scheme “B,” because it required minimal renovation to the existing structure, with administrative areas of the building being most affected. Hospital clinical operations would be relatively undisturbed, since the administrative functions could be moved to temporary mobile buildings.

          In March 1969, several trustees, hospital administrators, and architects went to Raleigh to meet with Bill Henderson, the executive director of the state Medical Care Commission. This was the agency that approved all bonded indebtedness for public health entities, and at a previous meeting it had been asked to consider the four proposed alternatives for expanding the hospital. Not more than a half-hour into the encounter, Henderson shocked the group by informing them that the commission was not going to approve any expansion for the hospital. He said that the building, even if expanded, would still be substandard, and would not permit the hospital to achieve what he thought its potential to be. Also, there was insufficient space around the building to handle the greater parking demands that would result from an increase in the number of patients. The commission was saying that in order to do what they wanted to do, they should consider building a new building in another location instead of expanding and renovating the old one. Without the approval of the commission, there would be no state funds for expansion. Local citizens would have to carry the entire burden.

         Sitterson, who was in the group that met with the Medical Care Commission, said, “I can remember the sick feeling that everyone had. We had a good building. It was a brick building that was very adequate but needed expanding. It was the equivalent of coming to the taxpayers of Pitt County today and telling them that we had outgrown the hospital and wanted to build a new one. I remember riding back to Greenville that day, and nobody said anything, because nobody wanted to come home and be the one to tell the news.”

          In April, Henderson wrote to the hospital planning group, “For all of these reasons and the little difference in money it would take to build an all-new facility, we suggested that the local authorities might wish to place prime priority on additional land and on studying seriously the advantages that may accrue in approaching your problems with an all-new facility. We are sure that you do not want to spend vast sums of money and still wind up in a facility that is comparatively sub-standard.”

          The “vast sums of money” that the city and county would have to raise locally appeared at the time to be an insuperable obstacle to taking this route, however desirable. The best course, in spite of the lack of encouragement from the Medical Care Commission, seemed to be to renovate and expand the existing hospital. In April, the committee met with the hospital board and the county commissioners to review the commission’s recommendations. One option considered was selling the hospital. The sale would remove the burden of having a bond issue, which would demand intensive campaigning with no assurance of success, and if it failed would waste the time and money invested in planning.

          C.D. Ward telephoned Cardwell to discuss the proposed addition to the hospital. On May 1, 1969, Cardwell responded with a written recommendation to add 50 beds to the 100 recommended the year before, to bring the total to 350. He added that the installation of 40 modular structures similar to some used by Rex Hospital in Raleigh might immediately relieve the overcrowding problem. Although this approach would not save very much money, it would save some time. Cardwell did not recommend whether the additional beds should be added to the existing hospital, or whether a new hospital should be built. He said that these possibilities had been explored earlier, and any final decision would have to be made by the hospital’s board of trustees and presumably the county commissioners. Cardwell had also learned that the Medical Care Commission had projected only 63 additional beds for the eastern region of the state. This was a major obstacle in the way of expansion. Since the Commission would not fund any beds beyond its estimate of needs, the community would have to finance the project.

Sell the old Hospital Building?

           In May, the joint committee of the commissioners and trustees met with the East Carolina University Regional Development Institute to discuss seeking buyers for the hospital building. R. T. “Captain Tim” Brinn, an economic development consultant with the institute, got in touch with several companies and government agencies that might be interested in buying or leasing the building for their own use. They might convert it to a hospital or long-term care facility, adding hospital bedrooms in modular units, or building a second hospital to supplement the existing one. Brinn found that several organizations were interested, but the time schedule for replacing the hospital was an impediment. Both private groups and government agencies hesitated to commit when the building would be available for use no sooner than late 1974.

          In October, a number of companies with extended care facilities in North Carolina had written about purchasing the hospital for use either for extended care patients or as an operating hospital. On two occasions, the county commissioners, the executive committee of the hospital trustees, and representatives of the medical staff and administration met with representatives of one of these companies, American Institutional Developers from Pennsylvania. They discussed a medical complex that would eventually have a 200-250 bed acute care hospital, a subacute and rehabilitation hospital with 300 beds, and an intermediate care facility if economically feasible, with centralized laboratory services and X-ray, some inpatient care, with outpatient and ambulatory patient care. Day care services would be provided for employees of the medical complex and other families in the community. The company estimated the complex would cost altogether more than $10 million.

          This statement was pivotal in the company’s proposal: “The support of the state and county would be limited to the care of the medically indigent, state vocational rehabilitation patients and the like for whom arrangements would have to be made by mutual agreement.” Ultimate management authority would be retained by the company, but with participation of local physicians in setting policies. The company did not recommend selling the hospital at that time to a private group but wanted to be considered a potential purchaser if it was eventually sold. In the meantime, the company suggested that they enter into a management contract to achieve more efficient operation.
          The company representatives met with the medical staff in November to discuss buying the hospital. After that meeting, the physicians decided to mail a ballot to members of the medical staff, asking whether they wished to continue looking into private purchase. The staff voted to go on with negotiations.

          In a tempestuous meeting early in December 1969, Cardwell, the planning consultant, detailed the many disadvantages of turning the hospital over to a private company. The company would have to operate it at a profit, whatever effect this might have on serving the community. He noted that private operation of Pitt Memorial would almost certainly eliminate the possibility of affiliating with a medical school if one should be established. His severe criticisms appear to have had little effect on the commissioners’ negotiations.

          On December 17, the county attorney was notified of the medical staff’s November vote. Interested businesses were scheduled to make presentations to joint meetings of the county commissioners, the executive committee of the board of trustees, the executive committee of the medical staff, and hospital administrators.
Meanwhile, the persistent problems with overcrowding continued unabated. On January 20, the hospital board voted to ask the county commissioners as soon as possible to close discussions on the hospital sale. C.D. Ward reported to the board that 11 patients had been in bed in the halls the night before, and that hardly a day passed without patients in this situation. He said also that the only bar to having a medical technology training program at the hospital was the lack of lab space.

          In January and February, private firms continued to appear before members of the joint committee. The committee decided to take no further proposals after February 15, 1970. On March 31, the county commissioners met with hospital trustees and medical staff to present the Regional Development Institute’s package of six proposals that had been submitted by private firms, along with the other proposals being considered. Staff member Dr. William Fore informed the commissioners that there were fewer than four beds per doctor among the hospital’s 200 beds. Dr. Donald Tucker, a member of the executive committee of the hospital board, then spoke on the immediate need for beds, as well as room for expansion of ancillary services such as operating rooms, laboratory, X-ray, and other departments.

          Dr. Howard Gradis, chief of the hospital’s medical staff, added, “We have to make our recommendations based on needs–regardless of what it costs. We should not try to second guess the public.” Dr. Tucker said that the public should understand that the county might lose control of the hospital if money was not approved for expansion. “One reason we are faced with this problem today is because the commissioners and people of the county were far-sighted 20 years ago and constructed what was at that time the best medical facility in this part of the state.” The facility attracted the medical staff, which in turn attracted the patients. Both Fore and Dr. Tucker declared that the shortage of facilities had to be rectified in order to maintain the medical community and bring in new doctors.

         After receiving the recommendations of trustees and the medical staff, the Board of Commissioners decided to submit the question of sale to a private firm to the county’s citizens through a referendum on a bond issue. If the community supported issuing bonds to finance expansion of the hospital, then there would be no question of selling it.

Teaching in the Hospital

          East Carolina University administrators had regularly pursued with hospital representatives the possibility of using PCMH’s facilities for clinical instruction. Dr. Monroe, one of the Greenville physicians who had been active at least from the early 1960s in the discussions, continued to be involved after he became dean of the School of Allied Health and Social Professions at ECU in June, 1968. He immediately began talking with the PCMH administration and staff about making the proposed hospital a clinical training site for allied health professionals studying at the university.

          In April, 1970, Monroe proposed that ECU should farm out students, when the medical school was opened, to community hospitals, instead of requesting state funds to build an independent teaching hospital in Greenville. He made the same proposal to a subcommittee of the Legislative Research Commission’s subcommittee on health, estimating that taking this route would save about $18 million in construction costs and 3 million per year in operating costs.

Funding the Expansion

          Then on May 19 the hospital trustees voted unanimously to ask the county commissioners to submit a $9 million bond proposal to fund expansion of the Fifth Street hospital. The alternative chosen (close to Freeman-White’s Scheme “B”) called for adding two floors with 42 beds above the hospital’s emergency area. A new building would be constructed in front of the hospital to house 125 beds, 25 of them for intensive care. The foundation for the new construction would be made strong enough to accommodate future expansion of 10 or even 12 stories if needed. The medical base would be large enough to provide X-ray, laboratory, and surgical facilities for a 500-bed hospital. The trustees emphasized that they wished not only to get patients out of the hallways, but to provide a hospital that would not be obsolete within a few years. They wished also to continue using the present structure, possibly converting it to an extended care facility later.

          The trustees met in the hospital board room with the county commissioners three days later and presented the request for a bond referendum. The commissioners did not act immediately on the hospital board’s request, but promised to meet again soon to vote on the issue. They acknowledged a pressing need to improve the hospital facilities, but recognized the difficulty of getting approval for any additional spending. Dr. Don Tucker, who was present at the meeting, told the commissioners that it was not a threat but a matter of fact that several specialists would definitely leave Greenville for better facilities elsewhere if no bond issue were passed.
          Tucker and several others asked whether it was possible as a temporary alternative to start construction on the 42-bed addition above the emergency area of the hospital, an addition expected to cost about $340,000. He described the results of a January visit by an engineer from the N.C. Insurance Department. The engineer had inspected the hospital to determine what changes would be necessary if a three-story addition were added over the emergency room.

          The commissioners said the county had no money to begin the smaller project before a bond issue passed, adding that until then private donations would probably be the only solution. They suggested that ECU might provide some funds if a bond issue passed, to ensure access to community facilities for teaching. Vocational Rehabilitation, then planning to make Greenville a regional center, might help, and there might be funds from other private and public sources. Donations, grants, or other funding would decrease the amount of bonds that would have to be sold. The $9 million figure was a maximum.

          Kenneth Dews, former chairman of the hospital board, declared, “We’ve investigated every angle now, and all the time the needs of the hospital have been growing. We are outdated as far as space and medical equipment go. From here on out, it’s up to the people. If they see the need, we’ll have an updated hospital that will keep the fine diversified medical staff we now have and probably attract others. If they do not, we’ll lose many doctors and many people will have to go elsewhere for medical attention. Also, I believe we will have to sell out to a private firm and let the people pay their profit-making prices.”

          On June 16, 1970, the hospital trustees passed a resolution formally requesting that the county commissioners call for a referendum in November to grant the board authority to issue up to $9 million in bonds for additional hospital facilities.The referendum was timed to coincide with the general election.

          The commissioners and hospital board had been assuming that the county would have to raise all the money for improving the hospital. The campaign for the bond issue had begun with this supposition. Then on June 18, 1970, the Hill-Burton Act that provided direct grants for hospital construction was passed again by the U.S. House of Representatives and immediately vetoed by President Richard Nixon. Just five days later, Congress overrode the veto—the first time in 10 years that they had done so—and reinstated the $1.26 billion in grants over the next three years. The House had included an additional $1.5 billion in guaranteed loans, and a provision that the administration must spend the money, not simply ignore it as past presidents had done.

           Dean Monroe wrote urging the county commissioners and the hospital board to include facilities that met national accreditation standards in their planning. He also pointed out the need for providing outpatient clinics, for meeting Medicare and Medicaid requirements, and for including accommodations to furnish experience in patient care to medical and nursing students, residents, and paramedical personnel. Some of the more conservative members of the medical staff found the concept of outpatient care inconsistent with their views of the functions of a hospital.

          On July 7, the county commissioners passed a resolution proposing a $9 million bond referendum to be held on November 3. The next night, the Greenville Chamber of Commerce and Merchants Association sponsored a “Medical Awareness Meeting” at the Candlewick Inn, attended by about 50 businessmen and their wives. Dr. Don Tucker spoke to the group about the history of the expansion project. Jack Richardson, assistant administrator of the hospital, presented a summary of activities over the previous three years. Woodrow W. Wooten, a merchant and farmer from Falkland, who served as chairman of the hospital board, commented on the history of the hospital, and led a question and answer session. A Chamber of Commerce member, Bill McDonald, commented that he had not favored the bond issue for the hospital until he had attended the “Medical Awareness Meeting” and heard Dr. Tucker’s and Richardson’s presentations.

          Harold Creech, Chamber of Commerce manager, and Gene Skinner, its president, pledged the organization’s help on the bond issue, and were assured that their help would be needed and appreciated.
On August 3, 1970, the Pitt County Board of Commissioners finally approved holding the $9 million referendum in November, “for the purpose of paying the cost of construction or acquisition of an addition to the Pitt County Memorial Hospital.”

Why Renovate When You Can Build?

          A delegation composed of the executive committee of the hospital trustees, several members of the medical staff, and several county commissioners went to Raleigh on August 6 to meet again with representatives of the NC Medical Care Commission. At the meeting they were persuaded that expansion of the old hospital was not the way to go. Woodrow Wooten, chairman of the board of trustees, clarified the reasons for their change of mind: “We had been convinced until that time that we would be able to get no Hill-Burton money, that all funds would have to be local, so we decided on the least... expensive method of getting better facilities. This led us to choose a plan of adding rooms over the emergency wing of the present hospital and building an annex which would house the bulk of the ancillary facilities like operating room, labs, and X-ray rooms, and most of the bedrooms, also.

         “At the August 6 meeting, however, Bill Henderson, executive secretary of the Medical Care Commission, told us he was confident we could receive an outright grant. He hinted at not less than $2 million. He urged us to change our plans—to build a facility that would be adequate for many years. Hill-Burton funds, once they are allocated, are usually not available again to the same area for at least 15 years,” he said.

         “Why, he asked, and we asked ourselves, should we spend $9 million on additions and renovations, when for $11 million we can have a new facility, extra land, and a building to either sell or use to boot?”
Commissioner Bob Martin said that what he had heard at the Raleigh meeting had changed his mind. The county attorney would be instructed to begin work right away on amending the bond issue application if the hospital trustees and medical staff would submit a formal written request to do so. The trustees and staff met on August 19 to discuss the proposal to build a new hospital rather than remodel and renovate the old one. After the meeting, they formally requested a change in the application for a bond referendum. County Attorney W.W. Speight began on August 20 to modify the bond issue application, designating the funds to be for a new hospital instead of changes and additions to the old one.

          The new hospital would be built on a site still to be chosen. On the advice of the Medical Care Commission, at least 100 acres would be purchased to allow for parking and possible future expansion of the building. The hospital trustees instructed the architects to plan a hospital with 350 private rooms and sufficient space and foundation for adding more beds later on.

          The commissioners took the final step toward the bond referendum on September 8, when they instructed the county attorney to proceed with the public notices for the amended bond issue. On September 10, notices were published in the Daily Reflector of the election to be held on November 3 and of the intention to apply to the Local Government Commission to have the $9 million of bonds approved.

          On September 16, 1970, the 22nd anniversary of the vote for the bonds that had funded Pitt Memorial Hospital, J. W. Pou, vice president of Wachovia Bank and Trust Company became general chairman of a citizens’ committee to seek funding for a new hospital with 330 beds. Pou’s selection as chairman was a wise move. In addition to being a respected businessman, he also had strong ties to a number of influential farmers in the county, many of whom were reluctant to support the higher taxes that would surely result from the bond issue.

          Many other Greenville business people and professionals enlisted to carry the message to the public.
          In November 1970, Pitt County’s citizens reluctantly took a major step forward, by responding favorably to the referendum on a special bond issue. They approved $9 million in bonds–by a scant 12 votes.

          In the spring of 1971, the county bought 97.5 acres of land near the old hospital to provide a site for the new one. The commissioners had definite building plans drawn up, taking into account the present and projected needs of the hospital, as well as the needs of the medical program being planned at East Carolina University.

          On October 11, 1971, the Pitt County Board of Commissioners passed a resolution to expand the project by establishing a Regional Rehabilitation Center as part of the new PCMH. They committed $881,000 toward constructing the 55-bed rehabilitation center, the balance to be provided from federal and state rehabilitation grants. The change in plans increased the cost of the project to $13.8 million. The committed funds still left a shortage of $3.3 million over the funds provided by the bond issue and the rehabilitation grants.

Funding the Building

          On August 2, 1972, the Daily Reflector noted that a Memorial Gifts committee had been established for the new hospital. The $3 million fund shortage still had to be made up. Some of the difference between the funds already allocated and the total needed, it was expected, would be made up from Hill-Burton grants and contributions. The Duke Endowment was expected to assist, and other foundations were being approached for support. Memorial gifts had already been received to the D. L. Moore Memorial Fund and the Dorcas Highsmith Memorial Fund. The Memorial Gifts committee was to approach individuals, families, and organizations for gifts to cover deficits and provide added facilities.

          On the same day, Burroughs-Wellcome Co. announced a donation of $30,000. The funds were earmarked for the Brooks Memorial Hemodialysis Unit of six beds included in the new hospital’s plans.

          During August, the county commissioners were compelled to apply for a $2 million loan guaranteed by the federal Health, Education and Welfare Department. The architects continued to work on the plans for the building, with the fall of 1973 targeted for soliciting construction bids.

          In November 1973, bids were taken for the hospital construction, coming in at $2 million above the estimated cost of the project and the money then available. During more than a month of negotiations, some cuts were made in the plans, and additional funds secured: a $280,100 grant from the state Medical Care Commission, $250,000 provided by the hospital board of trustees from reserve funds, and $537,645 from the county commissioners, to come out of revenue. It was now possible to accept the bids for building the hospital, and for work to begin. Most of the funding came from the $9 million bond issue, as planned, with the direct loan of $2 million from HEW, the $1.69 million federal and state rehabilitation funds, the $750,000 grant from the Duke Endowment, and $685,800 in federal revenue sharing.

          In October 1973, the organization of Petroleum Exporting Countries raised oil prices by 70 percent, and in December, by an additional 130 percent in retaliation against supporters of Israel in the Yom Kippur War. At the same time they placed an embargo on oil shipments to the United States. Two results of the oil shortage were lines of automobiles, more than five miles long in large cities, waiting at gasoline stations, though the price of gasoline moved up—premium grade approached 50 cents per gallon for the first time in history—and a sharp decrease in gasoline tax collections. By December, 99 percent of the gasoline stations in the U.S. were closing voluntarily to save fuel. Stations regulated sales by selling on odd and even days respectively to customers with odd- and even-numbered license plates. Along with the inconvenience and high gasoline prices, the oil shortage brought about a budgetary shortfall in North Carolina.

          On February 8, 1974, the Pitt County Board of Commissioners offered to sell the existing Pitt Memorial Hospital building to ECU for a medical school, as soon as the new county hospital was completed in mid-1976.

          ECU Chancellor Leo Jenkins said that Pitt County’s offer to sell the hospital to the university might be helpful to ECU in its efforts to expand. “This expression on the part of the county authorities is welcome and exciting news,” Dr. Ed Monroe said. “The present hospital facilities offer great potential in the future development of the medical school and the other health-related schools of the university, as well as possible future potential for a wide range of community-university partnership efforts in student training and health services in this area of the state.”

Building on Stantonsburg Road

          On Valentine’s Day, 1974, a groundbreaking ceremony inaugurated construction of the new Pitt County Memorial Hospital on Stantonsburg Road, a short distance from the existing hospital. A light rain fell as a small group of spectators observed members of the Pitt County Board of Commissioners and hospital representatives turn the first spadefuls of dirt for the construction. It was to include a 315-bed acute care hospital and a 55-bed regional rehabilitation center, and was scheduled for completion in September, 1976. R. L. “Bob” Martin, chairman of the county commissioners, said the new facility would tie in with development of the ECU medical school.
On that same day, Chancellor Jenkins wrote to Martin, “I am extremely gratified that you and the other members of the Pitt County Board of Commissioners have offered to make the present county hospital and its surrounding county-owned land available to us in the future development of the East Carolina University School of Medicine.” He commented that the lack of adequate facilities for clinical teaching had become an issue in the conflict over expanding the medical school. “Pitt County’s far-sighted and generous action should lay this spurious argument to rest,” he said.

          Jack Richardson, who had succeeded C.D. Ward as PCMH administrator in 1971, recruited Ralph Hall, construction manager at Lenoir Memorial Hospital in Kinston, to supervise the building of the hospital. He came to Greenville in July 1973. The hospital was the first of the more than 25 construction projects overseen by Hall during his tenure of over two decades as vice president for facilities services.

          Piedmont newspapers continued to follow the political machinations over starting a medical school in Greenville. On July 31, 1974, the Greensboro Daily News reported that ECU would like to purchase land near the new PCMH and retain an architect to begin planning the new medical science building, but that the UNC-Chapel Hill medical school administration had refused to release any of the $15 million appropriated by the legislature for development of the school.

          The spirit of perseverance remained evident at a September 1974 dinner held at the Greenville Golf and Country Club to initiate a $1 million fund-raising campaign for the hospital. Keynote speaker Lt. Gov. James B Hunt, Jr., leveled criticism at those who opposed the success of the medical school at ECU, “continuing to resist its expansion and the addition of a second-year program despite the mandate of the General Assembly that this be done.”

Movement Toward Affiliation

          In July, ECU medical school officials had arranged for medical students to use Cherry Hospital in Goldsboro for instructional purposes. In August, Pitt Memorial Hospital had taken a step toward relieving the pressure for a formal relationship with ECU by crafting an agreement with the medical school that would probably mean students could get clinical experience at the hospital. The agreement was only a general one, stating PCMH’s desire to work with ECU. Before the end of the year, the trustees and medical staff of Lenoir Memorial Hospital had voted to provide ECU medical students with in-service education. Affiliation plans soon hit a snag, however. The Medical Liaison Committee of PCMH, chaired by Dr. Jack Wilkerson, carefully considered the pre-affiliation agreement that had been offered by the UNC planners in August. The agreement was based on a non-traditional eight-year program in which students would spend their first and fourth years at ECU. This program would start after the sophomore or junior year in college, and run through a three-year residency in family practice.

          As the planning groups were discussing the affiliation between the hospital and the medical school, open conflict also arose between UNC-CH Dean Christopher Fordham and the medical staff of PCMH about the requirements for using the hospital as a teaching facility under his curriculum plan. Richardson noted that the limited clinical facilities in Greenville could make a second-year medical program at ECU a bit awkward and crowded during late 1975 and 1976, before the new building was completed, but indicated that the hospital could certainly handle this problem temporarily.

          The liaison committee concluded in September that it was not satisfactory to allocate 75 beds as teaching beds under the administration of the ECU medical school for 30-40 medical students and for the hospital to accommodate 16 full-time clinical teaching faculty and two non-physician professionals, along with six to eight pathologists. Further, the proposal suggested that the hospital should provide an outpatient facility and that staff doctors be available for teaching, with individual exceptions.

          Wilkerson relayed his committee’s suggestion that the Eastern Area Health Education Center provide the outpatient clinic, and that office space for the clinical teaching faculty should be furnished in the $15 million basic science building that was to be constructed. He emphasized that these matters were out of the committee’s jurisdiction, but said that the committee had previously endorsed the concept of affiliation with ECU. Their approval had been based on the understanding that the ECU program would add a traditional second year class.

          In the conflict over affiliation, the medical school staff were torn between their community care responsibilities and the responsibilities they felt to educate more doctors. Dr. Fordham acknowledged this dilemma in a September 18 meeting and expressed his concern that PCMH officials felt UNC planners were imposing their plan on the hospital. He emphasized that UNC did not originate the hospital’s dilemma and was sympathetic, reminding all that the demands of Section 46 of the General Assembly mandate required adequate resources for clinical teaching.

          The question of jurisdiction and appropriate allocation of resources remained a sticking point through September negotiations, as the hospital’s medical education liaison committee reviewed the latest agreement submitted by UNC. Speaking for the committee, Wilkerson noted that the group felt it essential that the hospital retain administrative control over all its beds. In addition, he related that some of the hospital’s staff strongly opposed the UNC policy of paying hospital staff for teaching only after the first 50 hours a year, which were to be donated. He noted that the committee could agree, with these reservations, to provide the necessary clinical facilities. The hospital staff had directed the committee to proceed with the negotiations.

          The committee wrote on October 3 to the UNC planners endorsing the ECU medical faculty program. The letter reiterated the hospital’s primary goal of serving Pitt County residents. It stated that no beds would be allocated solely for use by medical school faculty. It also expressed the committee’s unanimous support for the curriculum proposed by the ECU medical school faculty, and urged that the Executive Committee of the ECU Medical School faculty should be involved in further deliberations.

          These sentiments became more public in a statement on October 7, 1974, to the Daily Reflector. Dr. John Wooten, hospital chief of staff, reiterated the committee’s position against committing 75 beds to teaching, as recommended by the UNC planners. “Pitt County citizens are building the new hospital, and we’re not about to relinquish control of a large part of the facility before it’s a reality. The ECU people tell us it’s not necessary for the medical school to control the beds in order to teach in a hospital, and we know there are hospitals in the country used by medical schools which do not have such an arrangement.”

          Meanwhile the UNC administration in Chapel Hill became more frustrated. At an October 7 meeting of his Advisory Committee on the ECU School of Medicine, Dr. Fordham discussed the correspondence leading up to the PCMH Liaison Committee’s letter of October 3. He related that he was almost certain that ECU would not accept any supervision by UNC, any changes, or any ideas. Any LCME team visiting the Greenville campus would observe the hostility of the East Carolina faculty and administration toward UNC, making doubtful any cooperative arrangement between the two campuses with Chapel Hill in command. With his efforts to set up a school under UNC’s control persistently thwarted, Fordham wrote in his journal that he was beginning to wonder whether establishing a freestanding four-year medical school at ECU could be avoided.

The Choice Between an Independent Teaching Hospital and Affiliation

          A pivotal moment occurred on November 9, when UNC President William C. Friday recommended that the UNC Board of Governors authorize a four-year medical school with its own 200-bed teaching hospital at East Carolina University. He said that a two-year medical school could cost as much as $45 million to build and $10 million a year to operate, without increasing the number of doctors being trained in North Carolina. A teaching hospital costing $20 million would still be necessary even if the school’s curriculum were only increased to two years.

          Citing these reasons, President Friday lent his support to the four-year program in Greenville. He said that a new hospital could be finished by the fall of 1979. He also proposed building a $29 million clinical science building to be completed by the fall of 1978 and a $1.1 million outpatient clinic.
The plan the UNC Board of Governors submitted to the General Assembly included a $20 million teaching hospital for ECU. For the time being, affiliation between the medical school and Pitt County Memorial Hospital appeared to be in abeyance.

          The next hurdle lay with the state’s health facilities planning office. On November 28, 1974, the planning office director, Lawrence Burwell, expressed concern that building a new hospital in Greenville could draw patients away from other hospitals in the area and increase hospital care costs. Many eastern North Carolina hospitals were operating below their capacity, he said, and losing more patients could make fee increases necessary.

          Burwell’s office would have to approve the project in order for the hospital to be eligible for federal reimbursement through such programs as Medicare and Medicaid. The decision would be based on need, impact on other hospitals in the region, impact on healthcare cost, and estimation of the likely efficiency of the proposed hospital.

          The state Department of Revenue reported just after the middle of December that revenue had begun to grow again, so that legislators who argued that there would be insufficient funds for the medical school could no longer support that argument. On December 19, the UNC board of governors released $2.5 million of the $15 million medical education reserve fund to ECU, to be used mostly for planning. The board earmarked $698,000 for planning a 200-bed teaching hospital, $853,000 for planning the $26 million basic science building, $55,000 for planning an outpatient facility, $50,000 for planning interim clinical and library facilities.

          ECU forged ahead. On Tuesday, January 7, 1975, Chancellor Jenkins announced that ECU’s medical school would be located on a 50-acre site near the new PCMH. He indicated the land would be purchased that week. The basic medical science complex and a teaching hospital would cost $40 to $50 million, Jenkins said.

          Jenkins revealed that the plans included helicopter facilities for emergency and other medical services in a 75- to 100-mile radius. This plan addressed the inadequacy of roads for transporting patients quickly.

          Continuing, he stated the medical school would work closely with the EAHEC in Greenville, which would rotate medical students from teaching facilities to hospitals in the 24-county area it served.

          The General Assembly still faced the shortage in revenue that the recession had brought about, and wrestled with the problem of identifying funds to carry out the ECU project to which a majority of legislators had committed themselves during the previous session. On January 24, 1975, Representative Horton Rountree mentioned publicly for the first time that changing plans for the ECU medical school might mean that it would not need all of the $54 million set aside for it by the Advisory Budget Committee. The university and PCMH were discussing arrangements for providing clinical training facilities at the new hospital being built at a cost of $16 million. This arrangement might make it unnecessary to use all of the $20 million budgeted for a teaching hospital.

          Chancellor Jenkins responded that it would be premature to say that the $20 million would not be needed. It might become possible, and ECU would welcome any means of saving money, as long as the medical school program did not suffer. He said the $35.2 million 1975-77 appropriation for ECU’s four-year school was absolutely essential.

          In response, the hospital’s medical staff had reaffirmed its desire to affiliate with the ECU medical school. Jack W. Richardson, PCMH administrator, said the hospital staff “has issued an invitation to the school of medicine to enter into a relationship so it can practice medicine and educate medical students, as guests of Pitt Memorial Hospital . . . [with] all serving at the pleasure of the board of trustees and the Board of County Commissioners . . . in a real spirit of cooperation.”

          The medical staff emphasized, he said, that the hospital should “continue to be Pitt Memorial Hospital and its ownership maintained by the county,” and that “the cost of medical education be borne by the state.” The medical staff agreed there should be “no duplication of facilities in this community.”
Richardson said that the local physicians who practiced at the hospital recognized the need for medical education. They had offered “a set of principles for affiliation with the understanding that the teaching program be adjunctive to the purpose of providing medical services to the people . . .” He also said that the medical staff recommended that “another bed tower be considered” for the new hospital being constructed, “so enough beds to take care of teaching needs will be available.”

          Meanwhile, the county commissioners lent tentative support to the medical school. Chairman Bruce Strickland stated, “This commission will work with the medical school . . . any time they are willing to work with us.” He also said, “We have offered them the old hospital building, but we don’t want to get into competition with the medical school.” Establishment of a separate teaching hospital could lead to competition between the two hospitals, Strickland opined, but having the medical school base its clinical program at PCMH could “add prestige to the county operation.”

Competition from a 200-Bed Teaching Hospital

          An editorial on February 1, 1975, in the Raleigh News and Observer, a long-standing opponent of the school of medicine, commented that the PCMH medical staff in reasserting its wish to affiliate with the ECU medical school had “substantially qualified” its proposal. It said that the hospital staff and Pitt County commissioners were concerned about competition for patients by medical school faculty and by a 200-bed teaching hospital. They were uneasy about any affiliation agreement that might put a large portion of PCMH under administrative control of the medical school, but recognized that even the most disadvantageous affiliation might be better than competing with a teaching hospital.

          Planning for the school had not been completed, and difficulties in recruiting a dean and faculty might still be made difficult by tensions between the private physicians in the area and those paid by the state. Chancellor Leo Jenkins denied any misunderstanding or disagreement between local medical practitioners, the hospital, and ECU planners.

          In an address to the local Rotary Club, Jenkins outlined the planning that was under way. He said that primary care medicine would be emphasized, and that there would soon be residency programs in family practice. In addition, the university would cooperate with local physicians and the Eastern AHEC to set up residencies in medicine, pediatrics, gynecology, and obstetrics.

          Faced with the prospect of a competing teaching and research hospital, on March 12 PCMH’s medical staff agreed to offer the hospital as the primary clinical training facility for the school of medicine. A formal document, entitled “Principles of a Proposed Affiliation Agreement by the Pitt County Memorial Hospital and East Carolina University School of Medicine,” was to go before the hospital board of trustees the following week.

          Some still had reservations. Dr. Eric Fearrington, hospital chief of staff, noted that the proposed agreement was “not a legal document,” but “just principles for an agreement.” He explained that there were “three parties concerned with any affiliation agreement.” These were first the hospital, including its staff and board of trustees, second the University and its medical staff and board of trustees, and third the national accrediting agency.

          The agreement accepted by the medical staff had been developed over many months by the medical liaison committee of the hospital, working with the medical school’s administration, Kenneth Dews from the hospital board of trustees, and Charles Gaskins from the Pitt County commissioners. They had no template to follow, since the agreement was the first of its kind. It was in later years taken as a model by a number of other institutions across the country.

          The provisions of the affiliation agreement included these items:
          1. PCMH board of trustees would continue to administer the hospital, with 33 percent of its members               representing the university;
          2. with the complete knowledge and consent of the patient and the attending physician, all patients would               be available for the teaching program;
          3. patients from Pitt County would have priority for admission, in accordance with need;
          4. an open staff would be maintained, i. e., private physicians at PCMH, could decline to participate in the               program and remain on the staff;
          5. additional beds and supporting teaching facilities would be added to the new PCMH at the expense of the               State of North Carolina;
          6. the chairmen of the clinical departments at the university would administer hospital services internally,               with an advisory committee including non-university physicians to provide checks, balances, and review               for the system.  

          The medical staff had approved the principles by a large margin and had recommended that the hospital’s board should also approve, Fearrington said. “This approach to use Pitt County Memorial Hospital as the primary teaching center for the university will sort of obviate the need of having two separate hospitals in this community.” PCMH medical staff members and university officials had expressed a great deal of concern that the two hospitals might be “standing side-by-side with about 50 percent occupancy. . . a very expensive situation. I think this will save our citizens’ money.”

          Administrator Richardson confirmed, “I think it shows there is firm support for the medical school at ECU, with 85 percent [of the medical staff] voting to recommend to the trustees the acceptance of the principles.” Fearrington noted that the financial side of the joint venture would be up to the county commissioners and the hospital board, and was outside the authority of the medical staff. Richardson agreed, and said it would be the responsibility of the trustees and commissioners to set up a formal contract between PCMH and ECU.
          On March 18, 1975, the PCMH board of trustees of Pitt County Memorial Hospital approved the affiliation agreement. For the benefit of any board members who had not seen it, Dr. Eric Fearrington read the agreement reached by the liaison committee on which he served.

          Rainy weather during March had greatly hampered hospital construction. Ralph Hall, who was directing the construction, reported to the board that the foundation was completed and the structural steel almost all in place. Twenty-five percent of the work was complete, he said, and $5.2 million had been paid out so far.

          The financial outlook for a separate state-supported teaching hospital was starting to look gloomier, however. On March 30, 1975, the Raleigh News & Observer reported that revenue forecasts for the state were again increasingly pessimistic. It commented that the $20 million teaching hospital at ECU might be in for some cuts. It quoted Lt. Gov. James B. Hunt, Jr. as saying he would prefer for the medical school to use the existing facilities at PCMH. The $15 million budgeted for the rest of the ECU school “is less in doubt,” Hunt said, and would probably survive any budget cuts.

          The state’s budget problems gave UNC-CH officials new impetus in their quest for reasons that it was impractical to set up a new teaching hospital in Greenville and expand the ECU medical school. Claiborne Jones, UNC vice chancellor for business and finance, said in an interview reported in The Chapel Hill Newspaper that if the legislature allocated funds for a four-year school and associated teaching hospital, it would have spent more money at one time than it had spent over a period of 23 years on the Chapel Hill medical school and teaching hospital. Such statements served to discourage setting up a separate teaching hospital in Greenville, and so to encourage development of PCMH as the medical school’s teaching facility.

          Felix Joyner, UNC vice president for finance, an inveterate opponent of the Greenville medical school, stated that he knew of no federal funds available for a teaching hospital. Washington’s requirements on building new teaching hospitals were very strict, and he assumed the lack of federal assistance for ECU’s plans showed that the need for a hospital had not been demonstrated.

          A third UNC source who asked not to be identified said that the chances of ECU’s obtaining federal funds were very remote. It was difficult to show adequately that a hospital was needed because the four closest urban areas, Wilson, Rocky Mount, Goldsboro, and Kinston, had new, underutilized hospitals. The Division of Facility Services of the N.C. Department of Human Resources had reported that all four cities were served by hospitals less than 10 years old, and three of the hospitals averaged 35-40 percent empty beds.

          The case for PCMH and the medical school to affiliate grew stronger with every statement made by UNC officials. The advantages for the hospital of avoiding competition with an academic hospital were clear. The advantages of decreasing the costs of providing teaching facilities in a time of tight budgets became more and more distinct. In Raleigh, UNC Vice President for Academic Affairs Raymond Dawson told legislators on April 30, 1975 that if the ECU medical school reached an agreement to use PCMH facilities rather than building a teaching hospital, $6-8 million could be cut from the $20 million proposed for a new 200-bed facility. Adding 100-150 teaching beds to the new Pitt County hospital while it was still under construction made the budget decrease possible.

Affiliation is the Right Way to Go

          That same day, UNC President Friday recommended to the Senate appropriations subcommittee on education ways to cut the UNC budget. The subcommittee agreed and voted to cut $7 million from a request for $35.2 million in funds for constructing facilities at the ECU medical school. Friday said the money would not be needed because of plans to use the new PCMH as a teaching facility. He said medical educators had almost reached agreement with Pitt County officials and the PCMH medical staff.

          Support for affiliation gained momentum in the east. Local officials saw the establishment of a medical center in Greenville as important for the city and the region. It would become a focus for development of the entire eastern part of the state, encouraging the building of four-lane highways and new growth in the entire economy. The Raleigh News & Observer reported that as early as 1967, Greenville had the aspiration to become the “medical, higher education, cultural, and entertainment center of the coastal plain, as well as the economic center.” With a new medical school in sight, the city was well on its way to achieving its goal.

          On June 2, 1975, the Raleigh News & Observer, in character to the end, made another feeble attack on the project of building a hospital in Greenville. It wrote that, by federal standards, North Carolina had too many hospital beds, and eastern North Carolina, where a declining population was projected, had a larger surplus than other areas of the state. Even without the new ECU wing of PCMH, hospitals in Pitt County and surrounding areas would be only 60 percent occupied in 1980. With the ECU beds added in, HEW predicted 56 percent occupancy, and state planners who used different baselines from HEW in estimating hospital bed needs predicted only 75 percent occupancy in 1980. The newspaper commented that if a national health insurance program were passed, both formulas would become useless.

          The long-awaited affiliation agreement between ECU and PCMH was announced on June 12, 1975. ECU Chancellor Jenkins, Vice Chancellor Monroe, and Dr. Harold Wiggers, acting dean of the medical school, appeared before the UNC Board of Governors Planning Committee to report that ECU had reached an agreement with the hospital and the county to use the hospital for teaching. The agreement would take effect upon approval by the UNC board and by national accreditation officials. The hospital would maintain control over all the beds, but ECU representatives would hold at least a third of the board seats.

          The expansion of the hospital also had to be approved by the Comprehensive Health Planning Section of the N.C. Department of Human Resources in order for the new hospital to be eligible for Medicaid and Medicare reimbursements. The approval process was expected to take at least 45 days.

          The perennial opponent to the ECU medical school, Felix Joyner, UNC vice president for finance, asked what would happen to the bed tower if the agreement collapsed after several years. He answered his own question: The state “would probably have built the county a nice big hospital.”