Fri September 6, 2013
Norton Healthcare Sues University of Louisville in Kosair Children's Hospital Dispute
Norton Healthcare is challenging in court the University of Louisville's legal right to evict the healthcare system from the Kosair Children's Hospital property.
Filed Friday, the lawsuit is a response to a notice from the university claiming that Norton was in breach of its lease, a news release said. Last week, UofL gave Norton 30 days to back out of a plan to partner with UK HealthCare in running Kosair Children's. UK HealthCare is part of the University of Kentucky.
It's the latest volley in a fierce, on-going dispute that began in August when Norton and UK HealthCare announced their intentions. UofL argues that such an agreement violates Norton's lease on the Kosair Children's property, which belongs to the state with the stipulation that it be used for the benefit of the university.
Norton has offered to negotiation with UofL if the notice of breach is rescinded, Norton chief executive Stephen Williams said in a statement.
"We could not in good faith negotiate under those circumstances," Williams said.
On Thursday, Norton rejected UofL's demand that it back out of the plans with UK HealthCare. In response, David Dunn, UofL's executive vice president for health affairs, said: "We are highly disappointed that Norton will not follow the University's example and take steps toward a middle ground. Obviously, we hold a very different position than Norton and continue to hope they will come to the table and not let their inflexibility result in the need for legal action."
The bulk of Kosair Children's physicians come from UofL, and the university argues that a partnership between Norton and UK HealthCare diminishes the idea that Kosair Children's benefit UofL. UofL officials said last month they were surprised by Norton/UK HealthCare partnership and that they'd been in negotiations with Norton, as well.
In his statement, Norton's Williams argues that in the "rapidly changing world of healthcare," Kosair Children's and UK HealthCare's Kentucky Children's Hospital in Lexington must "find ways to further work together."
"Now is not the time for UofL to begin a monopoly on providing all physician services at Kosair Children’s Hospital, to demand $24 million we don’t owe, or if we don’t agree, to try to have us evicted from the children’s hospital we own," Williams said.
" UofL has never had exclusivity at the hospital and exclusivity is not what’s best for the Commonwealth’s children.”
Norton characterized the eviction threats as "highly charged and emotional" and argues that it "threatens to disrupt the medical care for Kentucky's children." The healthcare system said it has invested $500 million to build Kosair Children's and to improve it, and that it paid full value for the property through a donation to UofL.
Norton argues that its lease on the property calls for them to "make available" the hospital for UofL's medical school.
UofL has requested that Attorney General Jack Conway look into the dispute.
A Norton's spokesman declined to comment further.
We've requested further response from UofL and will update as soon as we get it.
Update: Here's Dunn's response:
"It’s unfortunate that Norton filed a lawsuit instead of meeting to negotiate a long-term agreement for the care of children at Kosair Children’s Hospital. The University of Louisville’s repeated attempts to meet and negotiate have been rejected again and again by Norton’s CEO, who told us today that he will neither meet nor negotiate while their lawsuit is pending. This is a disturbing trend in dealing with Norton as we try to resolve these complicated matters in a way that best meets the needs of Kosair Children’s Hospital, the patients we serve and UofL’s Department of Pediatrics. It is our hope that, later today, Norton will take a deep breath, accept our invitation to meet, and we all can focus on securing a long-term agreement to best serve the children of our community."