The partnership recently announced between the University of Louisville and KentuckyOne Health has addressed serious concerns voiced about the future of end-of-life services and certain types of care for women and the poor at U of L’s University Medical Center.
Gov. Steve Beshear and Kentucky Attorney General Jack Conway nixed an earlier planned merger between KentuckyOne, comprising St. Joseph Health System in Lexington, Jewish Hospital & St. Mary’s Health Care, and UMC in Louisville. The main reason was because the proposed merger would have given control of UMC to Catholic Health Initiatives, St. Joseph’s parent company. There were worries about a lack of separation of church and state.
“We heard what the community said. There was a lot of debate and discussion about the first version of the merger. So we stood back and tried to craft something to meet those concerns. [And,] I think we did,” Ken Marshall, COO of University of Louisville Hospital and James Graham Brown Cancer Center, told Business Lexington. “None of our end-of-life policies will change at University Hospital. Women’s services will still be provided in the future.”
“By addressing Gov. Beshear’s and Attorney General Jack Conway’s concerns, as well as listening to the community, we came up with this partnership that is going to help all our organizations move forward,” explained Ruth Brinkley, president and CEO of KentuckyOne Health, in a recent phone interview.
Under terms of the joint operating agreement, KentuckyOne Health will oversee most of the daily operation of University Medical Center while UMC maintains its assets and operates its Center for Women and Infants.
Conway had reviewed the original merger and recommended it not be implemented. KentuckyOne Health submitted a new proposal under the state’s procurement process and answered many detailed questions about its intentions. That process lasted about six months.
“My staff and I reviewed the final term sheet, and it appears to address the concerns raised in our December 2011 report,” Conway said in a statement. The attorney general went on to say the new operating agreement did not transfer ownership of a state asset.
“The executive branch … retains authority to oversee the new agreement. It also appears that the same health services will continue to be available on site at University Hospital,” he added.
Brinkley said the agreement won’t just benefit the Louisville area but also the entire state.
“It is going to help us expand care, training, education and research throughout the commonwealth. It’s a win-win for the state, KentuckyOne and University Medical Center, but most of all for our patients as we deploy our services to smaller communities,” said Brinkley.
Brinkley, who assumed her duties in January, said the agreement gives University of Louisville Health Sciences Center access to a statewide network. It will also stabilize the finances of the university. UMC has been doing well, Brinkley stated, but as administrators looked to the future, they realized UMC could not be sustained over the next five or six years “because in this business, scale matters.”
“They have gained significant scale and scope in this partnership with us,” said the KentuckyOne leader.
To central and eastern Kentuckians, Brinkley promises that “as this partnership takes hold, they will see more access to our clinical trials, training and education.
Marshall agrees that stand-alone urban hospitals such as UMC cannot survive long on their own and must leverage synergies across a larger system.
“Health-care reform has pushed us and a lot of hospitals into partnerships,” he said.
Dr. David Dunn, executive vice president for health affairs at U of L, calls the agreement perhaps “the largest health care transaction ever in the state.” He said he’s pleased that there will be $3 million a year for 20 years for statewide clinical trials.
“We intend to launch trials almost immediately through the James Graham Brown Cancer Center and also through our cardio-vascular medicine research programs,” said Dunn. “That’s how you discover new treatments for diseases.”
Does that mean more of a U of L medical presence will be seen in the eastern half of the state?
“We’ll have statewide reach, but our intent is not to compete with the University of Kentucky, for example. We would much rather collaborate with UK in cancer research and care,” said Dunn. “I think there are areas where U of L has considerable strengths, and UK would benefit from these collaborations.”
Dunn also mentioned predictions of a shortage of 3,000 physicians in Kentucky by 2020 and intentions for U of L to train more medical students, nurses, dentists and public health experts. Dunn said KentuckyOne Health is especially interested in that, because the Affordable Care Act calls for care to be offered to 350,000 Kentuckians who currently have no medical access.
“We are excited about this transaction and that Gov. Beshear and Attorney General Conway were so helpful,” said Dunn. “When many people talk about state and federal governments, they mention their meddlesome nature and overreach. I believe this process was an example of good government at work.”