A key deadline in the University of Louisville’s search for a partner to acquire Jewish Hospital and other local health care facilities has passed, but the university won’t say who has expressed interest in a potential deal.
“The university won’t be releasing any information about … respondents or the makeup of any potential partnerships until a partner or partners is chosen. And there is no guarantee that this process will end in a partnership,” UofL spokesman John Karman told Insider via email.
The university on Feb. 19 had issued a request for proposal, a formal step to identifying potential acquisition partners, though the scope of any purchase, a potential purchase price and details about cooperation among the parties had yet to be determined.
A deal with a single or multiple joint venture partners could involve as many as nine properties in the Louisville area with more than 1,300 beds combined.
“We are open to exploring any number of different models,” Karman said. “Our ultimate goal is that any partnership enables our clinical enterprise to compete more effectively and provides support to our academic and research missions.”
KentuckyOne has been trying to sell the medical facilities for nearly two years, in part because of financial problems. Nonetheless, the locations, especially Jewish, are critical to the university and serve as a staging area for many School of Medicine-related functions, including cardiology, organ transplantation and neurosurgery services.
For much of last year, KentuckyOne had been in exclusive negotiations for a potential acquisition of the facilities by New York-based alternative asset management firm BlueMountain Capital Management.
UofL in December had signaled its interest in the health care facilities by submitting a non-binding letter of intent to KentuckyOne’s parent, the former Catholic Health Initiatives. Karman told Insider last week that the university has had “conversations with BlueMountain where information was exchanged,” but that there had been no negotiations and that it was not involved in negotiations between BlueMountain and Catholic Health Initiatives.
Prolonged discussions between BlueMountain and Catholic Health had raised doubts about the survival of Jewish Hospital, which, together with Sts. Mary & Elizabeth Hospital, has been losing money at a rate of more than $1 million per week.
The closing of Jewish Hospital, a 462-bed downtown facility that employs thousands of highly skilled and paid health care professionals and takes care of tens of thousands of patients, would have far-reaching consequences for many parts of the Louisville community, sources have told Insider.
University President Neeli Bendapudi had said the institution is looking for a partner who can provide the needed capital and operational expertise to help UofL run the facilities.
She said the university was casting “a wide net” in its search for a joint venture partner, but interested parties had to respond by 4 p.m. Friday — just 13 business days after the issuance of the RFP. The short time frame and other factors had prompted health care experts to tell Insider that they didn’t believe the university would get many responses to its inquiry.
BlueMountain and another possible partner, Nashville-based Ardent Health Systems, declined to comment Friday. Ardent in 2017 saved a struggling 378-bed hospital by forming a joint venture with the University of Kansas when Bendapudi served as the institution’s provost and vice chancellor.
Louisville-based Baptist Healthcare, which said previously that it was evaluating the proposal, told Insider on Friday that it had decided not to respond to UofL’s request, because such a tie-up “did not fit into our strategic plan.”
Baptist said it recognizes the value that the university and its physician group bring to the health of the Louisville community and looked “forward to other potential opportunities for collaboration.”
Louisville-based Norton Healthcare, which also had told Insider that it was studying the RFP, on Friday wouldn’t say whether it had responded to UofL’s request.
“Out of respect for the University, we will defer to them regarding the release of information related to their process,” a spokeswoman told Insider via email.
When the university might make a decision is unclear.
Karman told Insider that UofL officials hope to come to a resolution “soon.” Meanwhile, KentuckyOne’s parent company, the former Catholic Health Initiatives, said in its most recent quarterly report that it still expects the transaction to close in the current fiscal year, which ends June 30.