Louisville, Ky.-based KentuckyOne Health has entered into a joint operating agreement with Louisville's University Medical Center and the University of Louisville. KentuckyOne now will oversee most day-to-day operations of the University Medical Center and its facilities. The partnership, which was launched in mid-November, does not involve the merger of assets.
Under the agreement, the University of Louisville Hospital and the related James Graham Brown Cancer Center Ð which, prior to the partnership, had been managed by the operating company University Medical Center — will remain safety net facilities with the same indigent care services and charity care policies that they had in place before the agreement.
The University Medical Center will operate the hospital's women's center separately and with funds it retains. It will expand that center's facilities, according to a press release and information from the University of Louisville. "All current University Medical Center policies for women's health, end-of-life care and its pharmacy remain unchanged," the partners said in a joint press release.
In the next five years, KentuckyOne plans to invest $543.5 million into the partnership's facilities, including in academic programs, information technology infrastructure, discretionary spending supporting statewide health initiatives and research funding. Its investments under the joint operating agreement will grow to roughly $1.4 billion over 20 years.
The two systems that formed KentuckyOne early this year — both of which have a sponsorship relationship with Englewood, Colo.-based Catholic Health Initiatives — had planned to merge with the university hospital and cancer center from the outset of KentuckyOne. But, Kentucky Gov. Steve Beshear had rejected the three-way merger proposal based on recommendations from state Attorney General Jack Conway. Conway had been concerned about merging a state-owned asset with a Catholic system, in part due to potential challenges that could arise if the merger dissolved, concerns regarding the provision of women's and end-of-life services, questions regarding open records laws and questions regarding payments that may be made to out-of-state sponsors.
The newly approved joint operating agreement avoids such concerns, the partners and state officials say, because the state has not transferred ownership of its assets, the hospital's women's services will not change, Kentucky retains authority to oversee the joint operating agreement and public access to information about the university medical facilities will not change.
Leaders of University Medical Center and the University of Louisville Hospital said the partnership with KentuckyOne gives their facilities access to financial resources needed to expand and improve services and makes it part of a statewide health network. KentuckyOne has 13 hospital campuses and a network of long-term care facilities and outpatient services spanning Kentucky. Inclusion in that statewide network will give University of Louisville students more training opportunities and give faculty the ability to expand access to clinical trials.