But department officials said the hospital can prevent the termination if it significantly improves its procedures for dealing with mentally ill patients by Nov. 18.
In a letter sent to the hospital Friday, representatives from the Centers for Medicare and Medicaid Services told hospital officials that the Medicare agreement between the UNC Hospitals and the federal agency will be terminated Nov. 18.
The federal department's decision comes after a recommendation from the state department to revoke the hospital's Medicare and Medicaid reimbursements. The state concluded that the hospital practices inefficient procedure for dealing with mentally ill patients. The state determined in an investigation that 35-year-old Arcadio Ariza Cortes of Carrboro received insufficient supervision after his involuntary committal to the hospital's Behavioral Health Care Unit.
According to the state's report, nurses allowed the patient -- later identified as Cortes -- to leave the unit the night of his alleged suicide, Oct 1. He was found dead from head trauma at the ground floor of the Kenan-Flagler Business School parking deck.
But Jeff Horton, chief of the mental health licensure and certification section of the state department, said UNC Hospitals has the chance to notify the agency of improved procedures before Nov. 18. The agency will then recommend that the state reinspect the hospital's procedures.
If the hospital passes reinspection, the termination will be reversed, officials said.
Tom Hughes, spokesman for UNC Hospitals, said the hospital will definitely undergo a re-evaluation before the November deadline, but no date has been set. "We fully expect that when we have the next inspection, they will say everything's OK and we won't lose our funding," he said. "If they say everything's not OK, then I don't know what we will do (at that point)."
UNC Hospitals CEO Eric Munson said he does not expect the termination to take effect in November. "We have fixed our deficiencies," he said.
Horton said hospitals that lose Medicare and Medicaid funding can still function and eventually reapply for certification, although it is difficult.