After over eight months of negotiations, U of L Hospital and University Medical Center will enter into a joint agreement with KentuckyOne Health on March 1, 2013.
KentuckyOne Health — which is under directives of Catholic Health Initiatives — will maintain the day-to-day operations but U of L Hospital and the James Graham Brown Cancer Center will remain independent in its oversight and health directives, which was a major criticism during last year’s merger talks.
On Wednesday, officials said there were two competitive bidders, the other being Health Management Associates out of Naples, Fla. But, they say KentuckyOne Health was more aligned with UMC’s mission and goals.
Attorney General Jack Conway, who last year provided Gov. Steve Beshear his recommendations that U of L not merge with KentuckyOne Health, said the new joint agreement addresses issues that previously concerned him.
“It also maintains state control of the hospital. It does not transfer a state asset. It protects women’s health. It maintains all current services and it ensures the hospital’s ability to help care for our community’s indigent,” he said.
Under the 20-year $1.4 billion agreement, all services will be maintained at the respective facilities, but none of the Catholic health directives under CHI will be put on any of the University’s facilities.
In return, KentuckyOne Health will have access to UMC and U of L to help develop its healthcare system.
In the first few years over half-a-billion dollars will invest in academic programs, technology improvements and other services:
o $75 million annually for academic and program investments and another $95 million over the first three years for key service lines and departments;
o $70 million for critically needed IT infrastructure upgrades at UMC;
o $15 million for discretionary spending by UofL for each of the first three years, targeted on statewide health efforts; and
o $3 million will be dedicated for research annually and $7.5 million per year in capital investment for technology.
University officials say a study provided during the bidding process shows the return on investment looks very good in the first four years.
Update: Honi Goldman, a critic of the UofL Hospital merger plan from last year, issued this statement: “This UL ‘partnership’ is the old proverb of ‘once a camel gets his nose in the tent, his body will soon follow.’ So beware of the ‘Kentucky One’s’ nose.”
Update: Current University Medical Center policies for women’s health and end-of-life care will remain unchanged, officials said.
The joint agreement will lead to a $543 million investment to UMC in the first five years, then $1.4 billion over 20 years, officials said.
Earlier: The University of Louisville Hospital announced Wednesday a partnership plan with KentuckyOne Health — the same group it attempted to merge with last year.
From the announcement:
The University Medical Center (UMC) and the University of Louisville (UofL) announced today that they have entered a partnership that brings together University Hospital and the James Graham Brown CancerCenter with KentuckyOne Health. The agreements for the partnership have been signed by the partners along with Governor Steve Beshear.
This new collaboration with KentuckyOne Health is essential for University Hospital | James Graham Brown Cancer Center to continue its core mission as an innovative academic medical center and a vital regional safety net hospital that provides the highest level of care to all patients. This partnership will maintain local control of the hospital. Additionally, it enables the University of Louisville to continue to recruit and retain the best faculty for its health schools, which are critical as the pipeline of future generations of doctors, nurses, dentists and caregivers.
Last year, Gov. Steve Beshear rejected a plan that would have merged UofL Hospital with Catholic Health Initiatives and Jewish Hospital. Jewish Hospital and Catholic Health Initiatives then merged without UofL Hospital, creating KentuckyOne. UofL Hospital issued requests for proposals for a new merger plan earlier this year.
WFPL will bring more information as it becomes available.