Officials at Kansas University Medical Center are applauding Atty. Gen. Phill Kline’s negotiated agreement to allow the sale of the Health Midwest system to HCA Inc.

A key part of the agreement allows a foundation formed to assist with unfunded care of indigent patients to award grants to the KU School of Medicine and KU Med, the university-affiliated hospital. The previous agreement between Health Midwest and HCA prohibited KU from receiving money.

“There are some funds out there that can lead to some fresh ideas and fresh approaches, and we’re glad to have the potential to be a part of that,” said Dennis McCulloch, a KU Med spokesman.

The original agreement between the nonprofit Health Midwest and for-profit HCA excluded KU for several reasons, including that it doesn’t have 501(c)3 nonprofit status and isn’t located in Johnson or Allen counties, where Health Midwest operates medical facilities.

The new foundation, which will mirror one established on the Missouri side of the border, will receive 20 percent of net proceeds from the estimated $700 million transaction. Kline spokesman Whitney Watson said about $100 million would be available in a few months.

McCulloch said he expected about 5 percent of the endowment to be spent each year, to expand care for poor residents in the metropolitan area. Uncompensated care has skyrocketed at KU Med in recent years, up about $10 million between 2001 and 2002.

McCulloch said he didn’t know what benefits or how much money KU Med or the School of Medicine might receive from the foundation. Even if the entities don’t receive money directly, he said expanding capacities at other hospital would ease the burden on the KU Medical Center.

“We’re all looking for ways to address the underserved, and for opportunities to give better access to primary care and divert them from more expensive emergency room care,” he said.

McCulloch said that might include collaborations with other hospitals.

“We’ll look at existing programs and look outside the box,” he said. “That’s the whole idea here, to get innovative programs developed on the Kansas side and metropolitan-wide.