UofL and KentuckyOne Agree to Extend Their Academic Affiliation Agreement Another Four Months.

Barely within the statutory requirement for a response to an open records request, I received two critical pieces of the new contractual agreements between the University of Louisville and KentuckyOne Health that extend the current terms of their Academic Affiliation Agreement (AAA) and Master Support and Services Agreement (MSSA). These documents define the conditions and financial arrangements between the institutions for another four months with an option for automatic renewals. The extensions give some breathing room to the organizations currently working behind the scenes to determine the future of KentuckyOne’s operations in Louisville and simultaneously protect the ability of UofL to place students and trainees at Jewish Hospital and Fraser Rehabilitation Institute while simultaneously allowing Jewish Hospital (and Sts. Mary & Elizabeth) to maintain their status as a teaching hospital for Medicare purposes.

The AAA extends the financial obligations of KentuckyOne to the University until April 30, 2019 at the existing prorated monthly amount of $1.98 million for a total of an additional $7.92 million. This is a blessing for financially strapped UofL. The attachments to the agreements that I requested were not provided leaving me to assume that the intended ultimate beneficiaries of the continuing financial support remain unchanged. (Previous versions of Attachment-C contain a lot of personnel details so I will not to post a copy here.)

The two agreements referenced above are interlocking and these second amendments reinforce their connection.  Specifically, item 3 of the AAA notes that its Exhibit C is amended by adding the “Second Amendment to Master Support and Services Agreement.”  Linking the documents together makes sense, but I am not exactly sure what that looks like in final print, and I do not understand the reasons for changes in term-lengths of the Agreements.  The major clause in the new MSSA allows the agreements to automatically renew for periods of 10 months (up from the previous 6 months of potential auto-renewal) further deferring any last-minute anxiety for the concerned!  (There are several versions of earlier AAAs in circulation. The new language appears to amend Section 8.1 of the previous first amendment to the AAA by deleting and replacing its second sentence. In the original version of the AAA available to me, Section 8.1 contains only a single sentence! Any confusion is probably only mine and I will clarify later for this record if I can.)

Final Comment.
The extension of the agreements was, as I argue previously, critically important for the integrity of the two institutions. Obligations to students, trainees, and patients alone are manifestly inviolable. I commend KentuckyOne for shouldering its responsibility which will certainly present challenges. Its parent organization, Catholic Health Initiatives (CHI), has been under financial stress for some time and which I suspect has complicated its intended merger with Dignity Health anticipated at the end of this month. The long-sought goal of CHI to sell QualChoise, its poorly performing health insurance division, was recently announced and which may give the corporation some temporary room to maneuver financially.

As desirable as the extensions to the current Agreements are, the can is only being kicked further down the road. I have no information or prediction of what is yet to come. It is not clear that Blue Mountain Capital is currently the only party negotiating with KentuckyOne to buy its Louisville hospitals, or to what extent UofL will succeed in finding the money or a partner to take over (and at what non-financial cost).  We are still wandering in the dark woods without even a trail of breadcrumbs to follow. Not all fairytales end well for their protagonists.

Peter Hasselbacher, MD
Emeritus Professor of Medicine
President, KHPI
January 8, 2019

What Will Louisville’s Medical Landscape Look Like in 2019?

Isn’t it about time that the curtain is raised a little?

As we enter the new year, many anxious folks in Louisville are waiting to learn about the status of a proposed sale of KentuckyOne Health’s Louisville assets, and what that will mean to the University of Louisville and its Health Sciences Center. The University and KentuckyOne had an existing, multiply-extended, Academic Affiliation Agreement that would have expired December 31, 2018. This critically important document and related agreements defined the financial, administrative, educational, and clinical relationships between Jewish Hospital and the University. A valid Affiliation Agreement is essential for Jewish Hospital for Jewish and Sts. Mary & Elizabeth Hospitals to claim the financial bonuses and other advantages of a Medicare teaching hospital. An Academic Affiliation Agreement is equally important for the accreditation of the Medical School if it wishes to continue to train students and residents in Jewish Hospital or document that it has adequate clinical teaching facilities for its family practice and all its specialty programs. These are no small details. Continue reading “What Will Louisville’s Medical Landscape Look Like in 2019?”

UofL-Norton Dispute over Norton Kosair Children’s Hospital: Documents and Statements

The prominent dispute between Norton Healthcare and the University of Louisville over who controls what at Louisville’s Norton Kosair Children’s Hospital broke into public view the day I was leaving for a two week cruise around the British islands. I have been scrambling to catch up ever since. Due to the magic of technology, I was able to post two initial articles from the Amsterdam Airport and the middle of the Irish Sea.

There has also been much local media attention ably reported by Terry Boyd of Insider Louisville, Laura Ungar of the Courier-Journal, David A. Mann of Business First, Devin Katayama of WFPL, and others. Our local television outlets also covered the story. The matter spilled over to the national media. It is a great story for journalists!

Show Us the Documents.
Many statements have been attributed to the various players at Norton and UofL. Naturally, each wants to advance their particular viewpoints and each claims to be acting in the public interest. Some of the statements reported seem contradictory to me.

My instinct throughout this policy blog has been to go to primary documents and data wherever possible. In that spirit, I intend to use this post to assemble all primary documents and official press releases to make them available to the pubic. Therefore, I begin a list below of material I have available now. I will add to it as more become available.

Invitation to UofL and Norton.
I have seen emails and been shown other information intended for your internal use, but I am unsure of my right to make these public. I invite both parties to allow me to post the documents and internal communications to employees underlying their dispute so that the public can make reasoned judgments of their own. Because this matter is so important to Louisville and the Commonwealth, I do not think your argument should be conducted behind closed doors. We have a valid right to know the facts. In particular, I invite both Norton and UofL to send me their Affiliation Agreements, past and present, as well as the “Term Sheet” so frequently referred to in their legal letters. What is it you are really arguing about?

In the background.
There are another players mentioned in these documents whose relationship with UofL unavoidably and inextricably involves them in this matter: Catholic Health Initiatives and KentuckyOne Health. In fact, because KentuckyOne Health is now managing the Certificate of Need process for expanding the number and type of NICU beds at University of Louisville Hospital, I would say it is right in the middle!  Clinical and academic agreements exist between UofL and KentuckyOne that are highly relevant and of legitimate concern to Norton and the medical community. I have written about these before. Therefore, I also invite UofL and CHI/KentuckyOne to make their current affiliation and partnership agreements and other relevant documents available to us. In the meantime, I will summarize again in another article what I was able to extract from earlier public merger and partnership documents.

Continue for list of documents and statements. Continue reading “UofL-Norton Dispute over Norton Kosair Children’s Hospital: Documents and Statements”