Norton Healthcare and the University of Louisville have released the details of the agreement the parties reached Friday to settle an ongoing dispute over Kosair Children’s Hospital.
The issue began in 2013, when Norton announced it would partner with the University of Kentucky for pediatric care. Norton owns Kosair Children’s Hospital, the building is on land owned by the state, and Norton leases the property. But the lease includes a condition that the property be used in a way that benefits U of L, and the university claimed the new partnership with UK violated that provision.
Now, under the terms of the agreement, U of L will be Norton’s primary academic partner for pediatrics, and 90 percent of Kosair’s residency positions will be available for U of L students. The entities are also forming a new committee—the Pediatric Academic Medical Center Committee—to oversee the affiliation. Norton will also pay U of L $272 million over eight years for ongoing academic support and physician services from the university, as well as pediatric care investments. The money also includes a one-time payment to settle past financial disputes.
In return, Norton can pursue other relationships and programs, including the agreement with the University of Kentucky that initially sparked the dispute, as long as the hospital’s commitments to U of L are fulfilled. The land lease between Norton and Kentucky will also be amended to secure Norton’s control and ownership of the hospital. This will allow Norton to move forward with $35 million in capital improvements to Kosair.
In a press release, the agreement was praised by both Norton CEO Stephen Williams and U of L President James Ramsey. Both also thanked Kentucky Governor Matt Bevin for his help brokering the deal.