Editor’s note: The original post mischaracterized Huron Consulting’s contribution to Baptist Hospital’s financial recovery. Huron did not play a role in improving finances, according to Baptist officials.
We know by the traffic it generates you love IL’s Monday Business Briefings, and staffers and insiders love bringing it to you.
But it’s gotten to the point we have far more business news than we can squeeze into one post. So, rather than sit on what we know, we’ve created “The Closing Bell,” an end-of-week update.
We survived Derby (barely) and breaking news finally took a holiday, but we have a few tidbits. And by the way, if you followed our advice last week and bet California Chrome across the board, take your winnings and head for Manhattan for a long weekend.
Tell your CEO that Insider Louisville said you earned it. And if you are the CEO, well, you don’t have to ask.
This is the “Where will it end?” edition of The Closing Bell.
• First, it was the University of Louisville suing Norton HealthCare last year over who should control Norton Kosair Children’s Hospital downtown. U of L sued to stop a co-management deal between Norton and the University of Kentucky. Then, of course, Kosair sued U of L and the state of Kentucky, saying Kosair, not U of L, should control the pediatric hospital, one of only two in the state.
Last night, Dr. Peter Hasselbacher at the Kentucky Health Policy Institute scored a scoop, reporting Kosair Charities has joined the fray. In their suit, Kosair officials are claiming Norton, among other things, is using its Kosair name and revenue in violation of earlier agreements.
From Peter’s post:
To add insult to supposed injury, Kosair Charities claims that despite its financial support, the performance of Kosair Children’s Hospital lags behind that of its peers in the region and elsewhere. (Of course, that criticism would also apply to the University of Louisville which provides much of the professional support of the hospital.) Naturally, the claims expressed by one party in a lawsuit represent only one side of the story.
Peter also has Norton’s response:
Norton Healthcare media statement re: lawsuit filed by Kosair Charities
We are saddened and disappointed by the lawsuit filed by Kosair Charities Committee (Kosair Charities). Since 1981, it has been a donor to Kosair Children’s Hospital, owned by Norton Healthcare, through a long-term agreement that includes a provision to use “Kosair” in the name of our children’s hospital.
Kosair Charities began withholding its contractually obligated funding of the hospital last year and is now more than $6 million behind in payments it committed to support Kentucky’s only full-service, free-standing hospital for children, while continuing to advertise and take credit for its current and future contributions to Kosair Children’s Hospital.
We have continued to seek a friendly resolution to Kosair Charities’ ever-changing concerns and demands. We tried professional mediation to no avail and, last week, offered to continue the process until this matter could be resolved. The response we received came in the form of a baseless lawsuit.
More as we talk with the different parties.
• The Seattle-based retailer and drone pioneer just announced it’s adding 15 cites including Louisville to its everyday delivery service in tandem with the United States Postal Service.
In addition to L.A. and New York, where Sunday delivery launched last November, Amazon customers in the following locations in our region are now receiving deliveries on Sunday:
· Cincinnati, Ohio
· Columbus, Ohio
· Indianapolis, Ind.
· Lexington, Ky.
· Louisville, Ky.
Looks like most of Texas is also covered, including Austin and Houston, with this latest expansion of delivery, according to a news release.
“So far, the most common items delivered on Sunday include baby supplies such as newborn apparel, books and toys—Sunday delivery is clearly crossing errands off the weekend to-do list,” Mike Roth, Amazon’s vice president of North America operations, stated in the release. “We know our Amazon customers love the convenience of everyday delivery, and we’re excited to be offering Sunday delivery in more cities across the U.S.”
Amazon Prime members, who receive unlimited two-day shipping on millions of items, can order as late as Friday and receive their packages on Sunday, for free, according to the release.
This was a big national story late last year because of the obvious benefit to the Post Office, which has long been talking about cutting service because they’ve lost so much business to the digital world. But only now is the plan playing out in smaller markets.
Amazon itself delivers through AmazonFresh, its online grocery business. However, it also used postal carriers (on a Sunday!) UPS and FedEx to cover the “last mile.” And the USPS, of course, still goes every day to 150 million homes.
• More news about Amazon, which has a growing presence in this region. Amazon is giving free tours of all its facilities, including its new 1-million-square-foot fulfillment center in River Ridge Commerce Center in Jeffersonville, apparently. CNN just had a big post about founder and CEO Jeff Bezo’s decision to open up his operations to the public from coast-to-coast.
From the CNN post:
Anyone over the age of six can now tour one of Amazon’s fulfillment centers, where millions of products are stored, packed and shipped to customers.
“I’m always amazed when I visit one of our (fulfillment centers), and I hope you’ll arrange a tour. I think you’ll be impressed,” wrote Bezos in a letter to shareholders earlier this month.
The company has 37 of these warehouses in the United States and is opening up six of them to tours. The hour-long tours will be held on the first and third Tuesdays of each month, beginning in May, and can be booked online.
CNN reporter Katie Lobosco speculates on whether opening the doors to the public is Bezo’s answer to criticism of how Amazon treats its employees. What’s for certain is that Amazon is pushing the safety of their fulfillment operations, which typically are 1 million square feet or larger.
This could easily be as cool as those middle-school field trips to GE Appliance Park.
• Pending state approval, Taxi 7 is coming to Louisville. This is NOT the same trend that has brought Uber and Lyft, which have no vehicles, using apps to hook you up with drivers in what are essentially peer-to-peer ride-sharing arrangements.
Taxi 7 will bring a new fleet of 90 Ford C-max hybrid vehicles to Our Fair City. Investment-wise, this seems like a serious endeavor, with the cars going for about $25,000 a pop, or $2.25 million for 90. Though we’re guessing you get a discount over 50.
The Ford C-max Hybrid produces considerably lower emissions than your standard taxi cab, according to a news release. This is good news for an Ohio Valley city that can have serious summer air pollution spikes.
And yes, there is a smartphone app to book your taxi.
More on this later today.
• Baptist Health, unlike one of its rivals, is back in the black.
Modern Health Care System is reporting two years of belt-tightening are paying off for the Louisville-based health care system. Part of the improvement seems to be the expansion of Medicaid under Obamacare, with Baptist reporting a 30-percent decline in uninsured patients!
One insider noted that KentuckyOne, which is in the process of cutting $200 million from its budget, is now the only Kentucky system still struggling as Baptist and Norton HealthCare are generating an operating surplus. (These are nonprofits.)
After reporting a net loss for 2013 and a credit rating downgrade, Baptist reported a six-month surplus of $24 million, compared with a loss of $7.9 million for the first half of FY 2013. Total revenue increased to $1 billion from $929 million for the same period a year ago.
Inpatient admissions were down 6.3 percent compared to Q1 2013, but the system has cut both staffing and costs, according to the post.
• You heard it here first. America is about to become Japan, at least in terms of demographics. Reuters and other news outlets are reporting on new government reports predicting the number of Americans age 65 and older will double by 2050.
One in five will be 65 or older as early as 2030. Demographers project there will be more people over 65 years old than under 18. Which is what is already going on in Europe and Japan, where 25 percent of the population is over 65. America will have one of the smallest labor pools in its history. So, who will do the work?
• Translation service In Every Language, founded in Louisville in 2005, is relocating its headquarters to Washington, D.C. However, the company will still have Louisville operations, according to a news release. Founder Terena Bell chose D.C. because of its proximity to three international airports, the international business community, “and a recent growth in DC’s start-up tech community,” according to the release.
Washington also has a lot of translators and interpreters because American Translators’ Association headquarters are in nearby Alexandria, according to the release.
Bell & Co. also considered Boston and Portland, Ore.
From the release:
“The Louisville community has helped us grow into the company we are today,” CEO Terena Bell said, stressing that the company will continue to serve local clients after the move. “We have no intention of leaving Louisville or Kentucky without access to the same high-level quality of language services that our clients are used to receiving.” As a result, the company will continue to work with approximately 20 interpreters in Greater Louisville and 10 more in the Bowling Green, Hopkinsville and Northern Kentucky areas. In Every Language works with a team of more than 1200 translators and interpreters.
The company’s satellite office in Durham, N.C., is unaffected.
• Dallas-based Dickey’s Barbecue Pit is entering the Louisville market with two stores, including a location in a St. Matthews strip center that also has a Kroger. The address is 285 N. Hubbards Lane. A second store is planned for 9930 Linn Station Rd. in Plainview, just off North Hurstbourne Parkway. This is a large and rapidly expanding chain.