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Archive for Thursday, February 16, 1995

HOSPITAL TO WEIGH ADDITIONAL OFFERS

February 16, 1995

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LMH officials will consider several ideas before deciding on a partnership plan proposed by Columbia/HCA.

Members of Lawrence Memorial Hospital's board didn't rule out a deal, and Mayor Jo Andersen said she liked much of what she heard of the 50-50 hospital partnership Columbia/HCA Healthcare Corp. proposed Wednesday.

But don't expect LMH or the city to make a financial deal with another health care provider for months, if at all.

"I liked that people are not wanting to duplicate services," Andersen said of Columbia's presentation Wednesday before the hospital's nine-member board.

"I liked that people are wanting to keep patients from Lawrence in Lawrence," Andersen said. "I liked that everybody is on board for wanting to improve health care services while keeping costs down. And I liked the public statement that no matter what happens, no matter what route we take, that people who can't afford health care will still be cared for.

"I felt like the hospital board handled a very good meeting. They're going to have a lot to think about."

There will be much more to think about in the coming months. By the end of April, the hospital board hopes to hear presentations by four other area health providers, as well as a presentation by the Jayhawk Alliance, an association of five area hospitals: LMH, Olathe Medical Center, Miami County Hospital in Paola, Ransom Memorial Hospital in Ottawa and the KU Medical Center in Kansas City, Kan.

Hospital board member Donna Bell said she was interested in hearing from other potential partners with LMH before making a decision on Columbia.

"So at this point, I'm reserving judgment," she said.

The hospital board's chairman, Ken Martinez, is wary of joining forces with Columbia, a company known, as one of its executives acknowledged Wednesday, for being a "fierce" competitor.

"They can say anything," Martinez said. "Doing it is another thing. They said they don't want duplication, but they're creating duplication. It doesn't make sense. You can't have it both ways."

In July 1994, Columbia opened Mt. Oread Medical Arts Centre, a doctor's office and occupational health and minor-emergency center at Clinton Parkway and Kasold Drive

An adjacent outpatient surgery and diagnostic building will open this spring. Columbia executives said last month that they would build a new 50- to 70-bed hospital in Lawrence unless the company could buy all or part of LMH.

"I guess you have to not be bowled over by threats of that nature," LMH board member Don Johnston said.

Columbia proposed forming a new for-profit company that would be half owned by the city and half by Columbia, the nation's largest for-profit health care company.

In addition to LMH, the new company would include the Mt. Oread facilities, and Columbia would pay the city an unspecified amount of cash to create an "equitable partnership." All LMH employees would be retained by the new company.

Columbia would manage the new company and its facilities, but Columbia would not have a controlling interest in the company or its board.

The new company would be governed by a board partly appointed by the city commission and partly by Columbia.

Columbia's proposed partnership with the city would bring new tax revenue to the city and Douglas County -- an estimated $1.7 million a year, according to Columbia -- but would, as outlined Wednesday, diminish local control of long-term decisions about how the hospital should be run.

Since the 1920s, LMH has been owned outright by the city, with a board appointed by the city commission.

"You can't drive a vehicle with two people sitting at the steering wheel," Johnston said. "Fifty-fifty sounds wonderful, but somebody's in charge and it's clearly them."

Kevin Hicks, chief executive officer of Columbia's Overland Park Regional Medical Center, said that's not what his company is after. He said Columbia is ready and willing to negotiate the specifics of its proposal.

"The process has just begun," Hicks said. "Their options are to continue their own plan and remain a stand-alone facility, to partner with somebody else or to join us. We recognize that's a big, big decision."

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