5:50am

Tue January 10, 2012
Health and Welfare

U of L Hospital Officials React to Beshear's Rejection

University of Louisville Hospital officials say Gov. Steve Beshear’s decision to reject the proposed merger with two other health care entities will likely lead to cuts to indigent care.  Beshear met with U of L merger officials last week after rejecting a three-way merger with Jewish/St. Mary’s Health System and Catholic Health Initiatives. Last week Jewish/ St. Mary’s and CHI officials announced they have reached an agreement to merger without U of L, retroactive for Jan. 1, 2012.

Beshear rejects the latest proposal, saying U of L Hospital produced a  profit in 2010 and it is a hospital with strengths.

“I think I saw where last year they had a $13 million profit. So it looks like it’s being run well. I think there will be a lot of options out there for University Hospital,” Beshear said in a prepared statement to media.

Hospital officials call that claim “disingenuous,” and say that profit accounts for less than a 3 percent growth, which would not sustain U of L Hospital’s plans for expanding. The merger was vital to the hospital’s future in serving the nearly 20 percent of patients who are unable to pay, said  CEO James Taylor.

The most recent alternative plan for capital investment includes an initial $385 million in order to satisfy increased patient demand and to provide updated technology. It also included an additional $50 million a year in operating costs.

Taylor said Beshear’s decision will lead to cuts in the future, but wouldn’t predict when those might occur.

“I’m not prepared today to say how and when those cuts will happen but its inevitable that given our financial status we are not going to be able to continue to serve the mission as we have,” he said.

U of L has been pushed away from the negotiating table and will likely continue talks with CHI for alternative partnerships, said Taylor.