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Creating a healthier Kentucky

by Rushton,Jeff last modified Aug 01, 2011 08:06 AM


From the desk of Jim Ramsey

Creating a healthier Kentucky

August 1, 2011

The rationale for the merger of Jewish Hospital & St. Mary’s HealthCare, Saint Joseph Health System and the University of Louisville Hospital

    If you have read the newspaper, watched local news (primarily in Louisville), or listened to the radio in the past week, it is likely that you may be confused about some of the details regarding the merger that we have been working toward for the past 18 months.

    While we are addressing the legitimate questions and issues being raised, we feel it is important to keep the “why’s” of the merger at the forefront as we work our way through the “how’s.”

    Why merge?

    Kentucky faces huge health challenges, too big for any single organization to solve. We believe that by working together we will have the resources and reach to address these critical issues.

    According to the Centers for Disease Control and Prevention and the American Heart Association, Kentucky ranks among the 10 states with the worst health indicators for cancer, obesity and death due to heart disease and stroke. More than half of the state is designated as medically underserved, and there is a growing scarcity of physicians across Kentucky.

    The partners are committed to expanding most services provided throughout the health system. This includes care for the poor, the at-risk and the uninsured. The depth of this commitment is evident in year-over-year increases in all of the partners’ levels of quantifiable community benefit, which includes charity care. Together, the three partners provided more than $270 million in community benefit, including indigent care, in 2009. That number swells to more than $850 million nationwide when all Catholic Health Initiatives’ entities are included.

    University Hospital and Jewish Hospital & St. Mary’s HealthCare for years have sacrificed much needed capital reinvestment in their facilities so that each can continue their missions of serving those who cannot afford care. This noble activity has taken its toll on both organizations.

    Without sufficient capital, the growth of University Hospital and JHSMH – in terms of physical plant, equipment and the increasingly sophisticated services the community demands – will be limited and current levels of service may not be available.

    Not merging also will eliminate the capital investment that has been delayed for years as both University Hospital and JHSMH have fought to continue their missions for providing for the indigent, as well as providing a place to train future generations of health care providers. Two hundred million dollars has been set aside for upgrading ULH and Jewish Hospital within the first three years of the merger. And with the merger, a new $100 million electronic medical record system will be implemented. This infusion of new money into the Louisville market would not be available without the merger.

    Why combine a teaching hospital with hospitals with religious affiliations?

    The new health system will include hospitals, clinics, specialty institutions, home health agencies, satellite primary care centers, and physician groups with 91 locations combined. The reach of this integrated system provides the opportunity to efficiently move research from bench to bedside and improve health care outcomes statewide. In addition, physician training programs may be expanded to facilities throughout the Commonwealth, addressing both the rural physician shortage and fulfillment of the University of Louisville’s statewide service commitment.

    Saint Joseph Health System has nine facilities statewide, six of which are in rural areas, and five of those are sole providers for their communities. By bringing together the three partner health care organizations, we will be better able to extend the most recent knowledge and technology more quickly to these rural areas.

    The Louisville academic medical center will double in size to include University Hospital/James Graham Brown Cancer Center, Jewish Hospital and Frazier Rehab Institute; while extending the research and teaching programs of the University of Louisville statewide through an academic affiliation agreement with the School of Medicine.

    While there are challenges to simultaneously upholding the academic requirements of the University of Louisville School of Medicine and abiding by the Ethical and Religious Directives of the Catholic Church, we will do both – as have similar partnerships across the country. The faculty of the University of Louisville School of Medicine are not participants in the merger, and will continue to provide their historic level of clinical care and training, although some parts of that service and teaching will be provided outside the merged health system.

    Why should our patients and communities care about the merger?

    By having the financial stability to carry out our traditional mission of indigent/charity care, the new system we will be able to make the necessary investments to:

    • Share best practices for excellence in patient- and family-centered care
    • Pool resources for efficiency
    • Disseminate knowledge to provide care closer to homes
    • Increase opportunities in health care training
    • Increase reach for medical research

    All these things are necessary for the new health system to address the significant health issues we face. As one organization, we believe we can achieve our ultimate goal – a healthier Kentucky.

    Why would the Louisville-based entities give up control to a Denver-based system?

    The new entity will be governed by a community board of trustees with fiduciary responsibilities. Bob Hewett, the board chair, is a lifelong Kentuckian and a long-time board member (including chair) of Saint Joseph Health System.

    Catholic Health Initiatives’ 70 percent stake in the new entity has been widely reported, but misunderstood. The 70 percent stake is based on Saint Joseph Health System, which includes nine regional facilities with 1,012 licensed beds, more than 5,000 employees and 1,300 physicians on its medical staffs – all in Kentucky. It also reflects  the value of CHI’s 25 percent share of the Jewish Hospital & St. Mary’s HealthCare system, based in Louisville and CHI’s capital infusion to the new system.

    CHI’s investment in the new partnership will benefit not only Louisville’s academic medical center, but will enhance health technology and care delivery throughout the state, and improve local economies through expanded hospital workforces, health care education programs and other outreach within the communities.

    The academic medical center in downtown Louisville will have a standing committee composed of 11 individuals, seven of whom will be from the University of Louisville. This group will advise the health system board on issues related to the teaching and research mission of the academic medical center, the capital budget for the downtown academic medical center, the hiring and performance of the lead administrator for the academic medical center and the strategic planning for the academic medical center.

    Why are there still so many unanswered questions?

    The signing of the definitive agreement, announced in June, marked the end of a phase of our work together that included establishing common goals, intent and desired outcomes. We continue to work on all the details of “how” we will come together, including information systems solutions, human resources policies and procedures, clinical integration and more. We will update you on our progress in all of these areas as milestones are reached.

    Given all the benefits inherent in the merger, we ask, why wouldn’t we come together to better serve our communities, our employees, and our state? There is so much we can accomplish together. We see a healthier future for the Commonwealth by combining our efforts to address the serious health challenges faced by the people of Kentucky.

    Jim Ramsey Signature
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