- The Wake Med / Atrium Health merger is approved.

J.D.

Vance rallies in Greensboro for North Carolina's Republican candidates, and a federal lawsuit is filed against the State Board of Election over new mail-in ballot rules.

This is State Lines.

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♪ - Welcome to State Lines, I'm Kelly McCullen.

Joining me today, Mr.

Bruce Thompson of Parker Poe, Jim Perry of NC Capital Strategies, to his right is Kimberly Reynolds of Maven Strategies, and Patrick Sebastian of Opinion Diagnostics is in seat four.

Hello, everyone.

- Hello.

- We have a great, well, this is a deep show.

I mean, it's a lot to talk about.

- A deep panel.

- It is a deep panel.

Like I said, we match the show topics with the brain power of the panel.

You don't believe me, do you?

Wake County commissioners voted 5-2 this week to approve Atrium Health's proposed combination with Raleigh-based Wake Med.

Governor Josh Stein said before Monday's county vote he would not oppose the merger because he saw improvements made to the original merger proposal.

However, State Treasurer Brad Briner warns the merger could shrink the competitive market, lessen that competition, of course, and lead to higher prices.

The deal still faces some federal review, Jim Perry.

Big deal, $2 billion.

WegMed says it can use that cash to upgrade its existing hospital facilities wherever it serves the community there around the Wake County area.

Your take.

- So I think it's a difficult topic that isn't captured well with sound bites.

And unfortunately, that's how we discuss most things today.

You hear a lot of truths about competition.

I understand the concerns.

If it had been UNC that bought the hospital, they would have 80% of the market in Wake County.

We'd have even less competition.

I think the need for capital is very real.

The campus is, whatever, 65 years old.

They need upgrades to be competitive.

And also, they've been price takers so far, right?

They haven't had the strength to push back and get the rates they need.

And when you have a payer mix made up of so many Medicaid patients versus commercial pay, it shrinks your margins.

I think the CEO's done a fantastic job recovering from the pandemic.

You look at his EBITDA numbers over the last five, six years.

And they're still single digits, right?

It's not like they're making a killing at Wake Med and they care for our most underserved population.

So I think it's more difficult than it's summed up to be.

And I understand why they wanted to go that way, to make those investments, to be competitive, and to keep the hospital healthy long-term.

- Kimberly, politically on a local issue like that, last I checked, the Wake County Commission, it's easy to say Republican versus Democrat.

In this case, not the case.

It's, I don't know who pits who.

The community was there, and then you have these commissioners elected by the same community doing what they think is best for the community.

- Yeah, this particular issue had interesting bedfellows all across the board.

You had two commissioners vote against it and five vote for it.

And I think the folks that opposed it were really concerned about the process.

They thought it went very quickly.

They didn't think enough of it was transparent for the public.

You had other folks concerned about prices and that we put profits over people and that it felt more like a takeover versus consolidation.

And so I think, as Jim said, it's a really difficult issue.

And I think what's at the core is people want quality healthcare and they want affordable healthcare.

And so this just became super complicated.

But then you had the governor get involved and after he got involved, there were some concessions made.

You saw that, I think in the book, they spend 4.8% on indigent care, that moved to 8%.

There's $150 million set aside for homelessness, mental health, food insecurity, things of that nature.

You had the $2 billion you're talking about, that went from 10-year investment to 15-year investment.

And the governor who opposed it in the beginning said, "Okay, I'm not gonna stand in the way.

It's got extra hurdles to go through at the federal government."

But I mean, I also think people remember Mission Hospital and the takeover in Western North Carolina and they have some real sour taste in their mouth 'cause they saw prices go up.

And so there's that.

- Patrick, if I use the word takeover, it makes people feel one way.

If I say a merger, it's another.

An absorption, another way.

Do words matter?

- The words do matter.

And this is something that our former state treasurer, Dale Folwell, started talking about about 10 years ago.

And if you see what happens with these kind of big mergers is what happens is higher cost, lower quality and less access.

That's pretty much the standard every time when it comes to consumers.

So people are understandably worried about this.

Everything is costing more.

Healthcare is just exorbitant in the cost for everyday people in this country.

And so the idea of a merger and making it more expensive and less accessible with potentially lower quality upsets some people.

And from the business standpoint of it, it makes great sense from the business standpoint, they're gonna probably do a lot better.

There's gonna be a lot more efficiencies that way.

But for the consumer, I understand why people wanted to block this and stop it and hold it up a little bit.

People can't afford these higher prices.

- Bruce, for clarity, Parker Poe has an interest, maybe not in this deal, but with Atrium as a client, I understand.

- Yeah, our firm does some work for Atrium.

I do not represent them, but wanted to make sure that was clear.

- We'll ask you to tread lightly, of course, because that is your family.

But when it comes to these deals, they look to the past to say, well, it didn't work so well in these other areas.

And so that means it will not work well in Raleigh.

Should we assume that?

- I think here's the difference.

People have looked at things that happened in the past and Kimberly mentioned the governor getting involved.

And I think he should really get a lot of credit for some of the concessions that were made in the deal.

She talked about a number of them.

One, I think that's incredibly important is that they've agreed to price caps.

I'm not aware of any hospital in our state that has agreed to price caps.

So if what we're concerned about is competition and affordability, affordability has been addressed.

You know, Jim made the point earlier with, you know, you look at Wake Med, they're in between two big health systems with Duke and UNC, and they are not as competitive.

This merger allows them to become more competitive and I think gives us more options in the market.

- Very quickly, Jim, is the market more competitive post acquisition or less competitive?

Should we believe Atrium?

Should we believe Stein or even Briner?

- I think it depends on your vantage point.

You know, from Treasurer's vantage point, he is right in that prices will likely increase because of that on some procedures.

But if you compare their pricing today to UNC system that has six hospitals operating in Wake County, their prices are lower.

They haven't been able to get the pricing they need to give them the margins to sustain the hospital in the long term.

Everyone's cost went up.

Hospitals were not immune to that.

They're paying more.

They're under more pressure.

They need some help like this.

- All right, more homework for me, for everyone that cares about the issue, switching to politics, Vice President J.D.

Vance campaigned for North Carolina's Republican candidates Monday in Greensboro.

A rally was held to primarily support U.S.

Senate candidate Michael Whatley, but news later broke that Republican-aligned Political Action Committee, Old North Action, has canceled a planned $6.5 million October advertising buy to support Mr.

Whatley.

Here's Vice President Vance.

- Do you want a person in Washington representing you who bends the knee to the far left?

- No!

- Absolutely not.

And because we need somebody who will fight back against the far left, we need Michael Whatley in the United States Senate.

We can't keep growing our economy.

We can't secure the border.

We can't support American workers and families unless we've got allies in Congress.

- Patrick, take us through the political consultancy of this, PACs pulling back $6.5 million.

That's their choice, but President Trump's in Gastonia last week.

J.D.

Vance is supporting Michael Whatley this week.

I thought when Republicans pulled out of a race, they all pulled out.

This seems to be a split decision.

- So Michael Whatley's losing this race.

There's no way to sugarcoat this.

In fact, my firm just released a poll this morning with Governor Cooper leading by 10 points.

When you add leaners in, which are people that are undecided on the first ballot test, we asked them, "Pick a side, please."

The lead goes down to eight, Cooper lead by eight, but you have Cooper winning 95% of Democrats, Whatley's winning 88% of Republicans, Cooper's winning unaffiliateds by 21 points.

Cooper's winning every media market west of I-95.

We asked people, this is a really interesting stat, we asked people where they get their news from, their number one news source, and the folks that said they watch local news, which is our broadcast channels, when they watch local news, Cooper's winning those voters by 25 points, which tell me when it comes to ads, 'cause that's where, folks, this is where the big money is spent on broadcast ads.

So when it comes to the ad war, Cooper's ads are working better than the pro-Whatley ads.

So that's something that is really, really serious at the moment.

As far as the $6.5 million being taken off the air, that's a lot of money, no doubt about that.

It's a ton of money.

However, they haven't taken all the money off.

There's still a bunch of money on the air for Whatley, and I have to believe if they didn't believe in 'em, they would've pulled all that money off, 'cause there's other places to play.

There's Michigan, there's unfortunately Texas, there's New Hampshire, Alaska, again, unfortunately.

So we have a lot of places to play as Republicans.

If they really didn't believe in 'em, I think they'd pull all that money off.

They haven't done that, so they obviously have some faith in 'em.

- Kimberly, what happens when you start getting news inside your campaign that folks who previously were gonna be very generous are suddenly not so generous with your candidates?

- Well, if you're inside the campaign, you're seeing the same polling numbers that Patrick's talking about.

This is not a shocking system to you.

I think Michael Whatley's camp probably knew that this was an uphill battle.

Roy Cooper is a battle-tested governor, attorney general, so they knew that they were gonna have a hard fight in front of 'em.

I think it sends, though, a strong message.

You never want to be the candidate, the guy sitting there, and people start moving millions of dollars off of your campaign with 30-plus days out.

It's just not a good signal.

So for Cooper, though, on the flip side, you have to be careful, too.

These polls, polls tighten.

I don't think polls are accurate anymore.

I think polls like that-- - Except mine.

- Except his.

(laughing) But I do not think Cooper's gonna win by 10, 12, 15 points like you've seen this week's polling show.

And so I think for Cooper's team on the flip side, it's also showing voters, activists, donors, do not take this for granted.

This is not in the bag.

This is North Carolina.

It's turnout.

It's all these things.

And we have over just 40 days left.

- Jim, that is an aspect of this campaign that I've noticed has popped up.

Roy Cooper himself, this would be a very close race, but every poll shows an eight, nine-point lead on average.

And then now you've got the left-leaning groups saying, oh, the right-leaning polls are meant to be so far ahead for Cooper that Democrats may not vote, so be careful.

What do we trust?

- We trust history.

And looking at North Carolina's history, I agree with Kimberly that this race is absolutely going to tighten.

It's not going to have that kind of margin at the end of the day.

I think that former Governor Cooper certainly has an advantage today.

But I understand Kimberly saying, hey, it's not time to take your foot off of the gas.

Everyone needs to keep working hard.

It will tighten, but it is an uphill battle.

- Bruce, what does it mean to have a vice president, have a president come in?

And years past, Hillary Clinton would come in, Barack Obama.

Does it make a real difference other than get some sound bites on the air for the week in which they visit?

- It's kind of a two-edged sword right now.

When you go back to 2024, it made me very nervous as a Democrat seeing the amount of time that Trump was spending in North Carolina and seeing the impact that has.

But with his polling where it is now, I'm now on the flip side of it where I'd love for him to come in every week and remind people that that's who they're running with.

One thing I wanted to add, my favorite political adage really, I think, applies to what's going on nationally.

And that is there's only two ways to run for office, unopposed or scared.

And you have somebody like Roy Cooper who sees a big lead, but he's gotta go through the finish line as if he's going to lose.

And the reason I think that has an impact based upon this topic in general is you have Republicans who have been in what they thought were very safe districts who feel vulnerable.

I mean, an R plus 10 district is not a slam dunk anymore.

And so they've got to make sure they take care of their own race before they're sending funds somewhere else.

- Well, I was gonna say, I'm just disappointed that we're actually not talking about what these candidates would do as senators.

Cooper's talking about what Whatley was doing when he was state chairman of the Republican Party.

And they're talking about Cooper's role as governor.

What are they actually gonna do as a senator?

And they're not being asked those tough questions, I guess they're being asked, but they're not answering the questions.

And that's been kind of a sad state of affairs.

Cooper's running on a campaign of make stuff cost less.

And that's fine, he's getting away with it.

I don't blame him, but how are you gonna make stuff actually cost less?

We're not really getting those answers, and that's an indictment of our politics.

- Well, I'll ask you, you said your poll was showing a huge interest from local news viewers, but I know local reporters and regional reporters who can't get access unless they drop by a campaign rally.

People like you are behind those strategies to stay national.

- I believe in complete access for reporters, okay?

(laughing) - Remember that, Kelly.

- I will remember that.

I've talked to several reporters, especially the Cooper campaign, they cannot get through.

But guess what?

It's working for Cooper, so I guess he's gotta keep doing it.

I don't think it's right, I don't think it's a service to the people of our state.

- But if you write a Cooper article, the Cooper campaign will reach out to try to-- - They will flip out.

- Yeah, they somehow know that you're writing the story, they somehow don't.

And that goes for everybody, I'm not picking on the Roy Cooper campaign.

- We can pick on 'em.

- I'm hearing the grumbling.

- How about this, a group of advocacy organizations filed a new lawsuit against North Carolina's Board of Elections over a new absentee ballot and voter signature guidance.

These are memos which aren't technically permanent, but they were approved earlier this month.

The plaintiffs will argue the memo demanding inner and outer mail-in ballot envelopes be fully sealed upon delivery will disenchant top franchise voters.

The suit also targets rules mandating that voters sign their absentee ballots according to that state rule, or those ballots would need at least correcting.

State Elections Board spokesmen say they will not address pending legislation, but that the voter experience with absentee ballots so far has not and will not change, Kimberly.

- I feel like a broken record when I come on here because I'm the one that sits in the seat and says, the system was not broken, and I feel like this was a group of politicians that had a solution and went in search of a problem.

And so you have seen elections that have come down to hundreds of votes in the last couple of cycles, and they want control over things.

And one of those is the ability to throw out ballots.

I mean, we already have a system in place that you have to have a notary or two signatures, and the inner envelope has to be sealed, and you have to have a signature.

I mean, you already have some pretty tough safeguards in place when it comes to voting.

And so now you're telling me, let's say an 85-year-old woman licks her envelope and it pops open and it's on the inside, and a sealed envelope, and that ballot gets thrown out, or her signature looks different because maybe she's older and it shakes a little bit.

And then to me with the signatures, so is it those, so you've got the local groups in 100 different counties, and there's inconsistency about how they're looking at them, how they're tossing them, and then is it those Republicans now that can then toss them out when they don't have to have that sort of three, they only have to have two now?

- But Kimberly, if you have a stash of unsealed absentee ballots in a close race decided by a few hundred votes, yes, people who want tighter rules would say, ballots can magically get stuffed into an open envelope.

Not buying that, huh?

- No, I am not buying that.

And I think we've also had over 8,000 votes cast, and they had been talking about this, I think since May and June, and they took a vote on it September 4th, which was the very day that ballots got mailed.

And that is just not the way you do elections.

Be thoughtful, be serious, and again, I just wanna say, the system was not broken, and so why we keep having to fix something that isn't broken becomes to me very political.

- Jim, why do we keep seeing elections, rules, lawsuits, and changes so close to an election?

Everyone on both sides of this debate that I can see, fairly intelligent people, and they must know that going to court while people are voting can't make the waters calmer.

- Yeah, I don't think they've been in charge of all of their timelines, and they've been forced into some situations when decisions come down, or when people finally meet to discuss something.

You know, for me, I wish we could go back to the days when adults could sit around a table and have a reasonable conversation, and reasonable disagreement, without assigning impure motives to each other.

There are impure motives at times.

We all know it.

We work in politics.

But I do think that reasonable people can disagree on some of the topics.

They can also work together to make improvements.

I think we all agree that ballot security, election security, is an important issue.

- Bruce, what's the incentive to ever settle this issue?

One side can be eternally aggrieved that ballots are tainted, or illegal votes are cast.

The other side can generate lots of income protecting democracy.

- Yeah, that's really my concern, Kelly.

I've represented candidates on both sides of the aisles for the past 30 years in election disputes.

And I agree with Kimberly.

You know, before, I mean, let's go ahead and call it, before Donald Trump showed up and started casting doubt over every election in the United States, people had confidence in it.

And one of the things I've experienced as a campaign lawyer is the local boards of election and their employees, they want one outcome.

And that is to make sure there's an accurate count and that everyone who's qualified has an opportunity to vote.

And it's not until people started sowing doubt.

And I think when you're doing things right here on the cusp of the election, it's setting it up for whoever the losing side is, they're gonna be able to point the finger that it wasn't a fair count.

And that's very unfortunate and really undermines what our system is all about.

- We're 10 years into this.

In 2016, remember Donald Trump won because allegedly the Russians quote unquote helped him win that election.

But ever since then, the presidential races, now Donald Trump has said he lost because of flaws and irregularities.

How do we, how many cycles do we get back to normal?

Or are we done?

- So we conducted a poll for right count several months ago and asked people if they believe ballots, mail-in voting is safe and secure or opens the door for fraud.

50% said safe and secure and about 44% said open to fraud.

So that's not real high confidence on mail-in voting.

So I think we need to do everything we can to build that confidence.

And that takes both sides sharing that.

I will say when we talked about that, in that poll we added, we noted that military personnel have been voting by mail for decades.

And when we inform people of that, the people that were skeptical of vote by mail actually increased their support of vote by mail by about 50% in and of itself.

- Can I ask you about the question on that?

Because if you ask me, is elections open to fraud?

Anything's open to fraud.

- Well we didn't ask about elections themselves.

- Or ballots or anything.

- Mail-in voting.

People are very open to Sunday voting.

They're open to early voting being 17 days.

They're open to a lot of things about voting.

But the mail-in voting people are very concerned about or at least more concerned than the other issues.

That's more so Republican.

But I think we need to do everything we can to increase that confidence.

And that means adding some safeguards.

To me that's fine.

But if you want to hurt people's confidence, keep doing these lawsuits.

Here's the deal.

These ballots are out.

Let's get voting.

Let's move on.

- I mean, you just said it right there.

It's been a decade of Donald Trump standing up telling people they should have lost confidence.

Not having proof points that something that they are insecure.

And so I would be interested how you ask the question when you said, why do you feel insecure?

What about it makes you feel insecure?

Versus just a bunch, if you said it's majority Republicans, them having the talking point of their president saying you should feel insecure with nothing to back that up.

- The people making the decisions need to have the same kind of discussion that the four of us just had.

Where you talk about where the problems are, how do you solve this, how do we do this together.

But unfortunately, it's just become a partisan talking point.

- That's where the lawyers are, the millionaire business entrepreneurs, self-made people are there.

You mean we can sit around a table and talk more intelligently than meetings you've had?

(laughing) - Yeah, I think I'm saying that.

- But at the end of the day, we should be doing everything we can to make sure people's vote counts and not discounted.

- And everyone's saying that.

- And by the way, our elections board across the state do a really good job.

Those people work so hard.

It's not a glamorous job.

I tip my hat to those folks who work their tails off.

- All right, we were discussing the constitutional amendment options that are on the 2026 ballot.

So this week, I wanna focus on that amendment that could lower the income tax cap.

There's one already in place.

Statewide voters, you will decide whether our state constitution would establish a maximum income tax rate of 3.5%.

The ballot question will read, quote, "Constitutional amendment to keep the state income tax rate "from being raised higher than three and one half percent."

End quote.

Current state budget, Jim, has our income tax rate at 3.49% beginning in 2027.

For clarity, the amendment does not cut taxes any further, just prevents future legislatures from raising taxes above three and a half percent.

- It does, and there are mixed feelings out there.

- What are your feelings about it?

- Well, I think everyone, it's the most bipartisan thing in the world to love a tax cut, right?

It's always so popular.

I don't care what your party affiliation is.

You don't wanna pay more.

You want the other guy to pay more.

That's just how it works.

We still have mechanisms if we hit a tight spot and need to raise money quickly.

There are mechanisms in place that you could utilize to fill some gaps.

You could always repeal a constitutional amendment if the people felt that way, but I think it's hard to get them to feel that way in the future, right?

- You'll be okay as long as the state continues to grow at its current rate.

You'll be okay.

If you are paying all of your bills today and you believe you have enough cash to meet all of your needs and you continue to grow population-wise, then you would say, "Hey, this is going to be fine."

If you think we're not going to continue that growth or that we didn't start at a place where we're already paying all of our bills, you have some concerns about that.

- I just find it very bizarre that we hand over tax policy to voters when it is the role of the General Assembly and future General Assemblies.

Some of them raise some of these taxes, some of them lower it, and that is their job, is to make those decisions based on the needs of the people.

If the people don't like it, they can elect someone else.

The fact that, what, in 2017, I think, or it couldn't have been 2017, 2018, we had it on the ballot for it not to be above 7%, and now we've moved it to 3.5, and to Jim's point, nobody's ever going to undo that because you're going to put a constitutional amendment that you have to go in and raise the taxes, but what you do is hinder future generations from being able to make real tax policy decisions on the needs of North Carolina based on their today, and I think that can be a problem.

- Bruce, people have the voice on this issue, though.

- They do, but I think the problem is, you know, when it's worded like that, just saying we don't want taxes going over a certain amount, that becomes a pretty easy decision for a voter, and Jim's right.

I mean, who's going to vote against lowering their taxes, but the thing it doesn't include is you are tying the hands of a future legislature.

We do not know what's going to happen in the future, and that's what concerns me.

- Last comment.

- The thing about it is the money's got to come from somewhere, so whether it's income taxes, property taxes, sales taxes, the government, unfortunately, is going to get their money, so we can talk about lowering this or increasing that if they're going to get their money regardless.

I was kind of hoping we put something on the ballot this year that was, as a Republican, that would have motivated our base and made the Democrats squirm.

You see, the Democrats did this, they pushed abortion constitutional amendments or amendments in Ohio and Kansas and other states like that, red states, and they made Republicans squirm that way.

I wish we would have put something on the ballot like capital punishment, the death penalty, which makes Democrats squirm, but it's a majority issue for North Carolinians.

I would have loved to do something like that to get our side motivated, make you, Kimberly, squirm.

(laughing) - At least he's honest about it.

- Hey, email us, statelines@pbsnc.org.

That's the show.

See you next time.

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