Kosair Children’s Hospital and Kentucky Children’s Hospital want to advance pediatric care in Kentucky. Not everyone is happy about it.

By Melanie Wolkoff Wachsman

In a state where approximately 25 percent of the 4.4 million residents are children, improvement in child health is exactly what Kentucky needs. The Commonwealth has one of the highest rates of pediatric obesity in the nation as well as one of the highest percentages of children who smoke. Diabetes and asthma are also among the chronic pediatric diseases affecting Kentucky children at abnormally high rates. Couple that with Kentucky ranking among the worst in the country in terms of childhood poverty, and it’s pretty safe to assume that Kentucky’s children may not be getting access to the healthcare they need. That’s about to change. Maybe.

Kentucky’s two children’s hospitals—Louisville-based Norton Healthcare’s Kosair Children’s Hospital and Lexington—based UK HealthCare’s Kentucky Children’s Hospital – recently signed an agreement to join forces to better meet the healthcare needs and interests of Kentucky’s children and their families.

In the Letter of Intent signed by the leadership of both organizations, the new partnership will maximize the hospitals’ combined resources to improve care and enhance access to quality services for kids throughout the state and ultimately improve the health of children throughout the Commonwealth. The two hospitals will remain independent organizations jointly operated through the collaboration.

“This partnership represents a powerful and innovative union that will allow both hospitals to leverage each other’s considerable strengths to do the most good for the children of Kentucky,” said Dr. Michael Karpf, executive vice president for health affairs at the University of Kentucky.

Statewide Children’s Hospital Network
The partnership strives to serve the state’s 1.1 million children.

“Our goal is to develop a more comprehensive statewide children’s hospital network to make sure every Kentucky family has access to top quality care for their children,” added Stephen A. Williams, CEO of Norton Healthcare, which owns and operates the Kosair Children’s Hospital.

Both organizations will continue to fulfill the obligations and opportunities of their respective children’s hospital relative to the important teaching, research and clinical services needs of the medical schools at the University of Kentucky and the University of Louisville.

“We are confident that both of our children’s hospitals will benefit from this partnership. But, more importantly, we know that Kentucky’s children will benefit under a more coordinated system of care,” said Dr. Steve Hester, chief medical officer, Norton Healthcare. “One of the many exciting elements of our partnership will be our ability to coordinate resources for the recruitment, retention and placement of top-notch pediatric specialists in order to improve and expand the availability of specialty services offered to kids in Kentucky.”

Partnership Pitfalls
However, not everyone is happy about the potential partnership. University of Louisville (UofL) said the partnership could jeopardize UofL’s relationship with Norton Healthcare, which owns Kosair Hospital. UofL Healthcare has long used Kosair Children’s Hospital as its pediatric teaching and research facility. According to the Courier-Journal “UofL’s pediatrics department educates medical students, helps take care of children and performs research at Kosair Children’s; and Norton, in turn, contributes to the pediatrics department’s annual $88 million budget.”

At stake is the future of UofL’s pediatrics department. UofL fears a partnership will cut into revenue and doctor training; consequently leading to cut programs and pediatric residency slots.

Further, Uof L accuses Norton Healthcare of violating a land-lease agreement by entering into the partnership. Kosair Hospital sits on state-owned land and under state rules it must be used for the benefit of UofL and the citizens of the Commonwealth.

UofL officials say Norton’s partnership with UK violates that agreement, and offi cials issued a legal letter to Norton demanding that they end the agreement with UK within 30 days.

After receiving the letter Norton accused UofL of “evicting” them from a hospital the own. UofL denies this.

To further complicate matters, UofL also claimed in the letter that Norton owes UofL $24 million. Norton denies this.

Failed Negotiations
Attempts to resolve the dispute so far have failed.

First, Norton asked UofL to withdraw the legal letter. UofL, in turn, offered a 30-day extension. When Norton rejected that offer, UofL offered to suspend the letter effective on the date of a negotiation. Norton declined.

Norton then filed suit requesting the court “to declare (University of Louisville) threats against Kosair Children’s Hospital to be without legal basis.”

UofL issued a statement calling the filing of the lawsuit “unfortunate.”

“The University of Louisville’s repeated attempts to meet and negotiate have been rejected again and again by Norton’s CEO, who told us today that he will neither meet nor negotiate while their lawsuit is pending,” the statement said. “ is is a disturbing trend in dealing with Norton as we try to resolve these complicated matters in a way that best meets the needs of Kosair Children’s Hospital, the patients we serve and UofL’s Department of Pediatrics.”

At press time, UofL is threatening legal action once the 30 days are up and has requested that the Attorney General’s office look into the matter.

Finally, a Breakthrough
After three weeks of back-and-forth bickering, on September 17, 2013, the two sides sat down for their first meeting. David Dunn, UofL’s executive vice president for health affairs stated that as talks began UofL would amend its agreement with partner KentuckyOne Health, thus eliminating the possibility that UofL could transfer its pediatric affiliation to KentuckyOne Health and try to “evict” Norton from Kosair. Those were the most pressing issues Norton had concerns with.

Dunn said in another statement that, “Our offer today shows without question that UofL has no intention of evicting Norton whatsoever, and that we simply want to get a master affiliation agreement in place and end this conflict.”

Following the meeting Norton officials released the following statement: “We had a constructive meeting and plan to meet again.”

As for the healthcare needs of the state’s 1.1 million children, with the battle based on the future of Louisville’s only children’s hospital still brewing—only time will tell.