KentuckyOne Health said it has “no current plans” to close Jewish Hospital or other facilities and is continuing to negotiate a possible sale with two interested parties, including New York-based alternative asset management firm BlueMountain Capital Management.
But the health system, which said the other party wishes to remain anonymous, also told Insider via email Thursday that reaching any deal likely will take longer than expected.
“We remain committed to finding a buyer for the entire portfolio, if possible, and we anticipate this process will take some additional time,” KentuckyOne said.
The system and its owner, Chicago-based hospital chain CommonSpirit, had hoped to finalize a transaction by June 30, a deadline that already had been pushed back repeatedly because talks with BlueMountain had taken longer than expected.
BlueMountain declined to comment on Thursday.
KentuckyOne has been trying to sell Jewish Hospital and eight other Louisville area health care facilities for more than two years.
While KentuckyOne has cited “significant challenges in the health care industry” as its motivation for a sale, public filings of its parent company have shown that Jewish and Sts. Mary & Elizabeth hospitals have been losing more than $1 million per week. The prolonged negotiations had raised doubts about Jewish Hospital’s survival among some local health care insiders.
For much of last year, KentuckyOne negotiated a potential sale exclusively with BlueMountain, but in February, the University of Louisville said it was seeking a partner to pay for an acquisition of the health care facilities, which serve as a staging area for many School of Medicine-related functions, including cardiology, organ transplantation and neurosurgery services.
For example, through an academic affiliation agreement, KentuckyOne paid UofL tens of millions of dollars last year to pay for more than 50 full-time medical resident positions at Jewish Hospital.
The university said Wednesday evening that it had abandoned the acquisition plans because it could not find a suitable partner to help fund the acquisition — estimated by one Insider Louisville source to be at $1 billion — and that university officials “were not willing to put the university at financial risk by taking on the acquisition alone.”
Nonetheless, UofL and KentuckyOne said they had extended their academic affiliation agreement — but both parties are making plans for it to end.
UofL President Neeli Bendapudi said Thursday that she has reached out to CEOs of Baptist Health and Norton Healthcare to see if either of them would be interested in hosting at their facilities some of UofL’s medical services currently being housed at Jewish Hospital.
KentuckyOne also told Insider Thursday that while it remains committed to providing care at its facilities, any future change to the agreement “will likely affect the services provided” at Jewish Hospital.
The new academic affiliation agreement was not immediately available. UofL declined to provide details.
Local health care experts have said that the loss of Jewish Hospital would have far-reaching consequences for many parts of the Louisville community because the 462-bed downtown facility employs thousands of highly skilled and highly paid health care professionals. It also takes care of tens of thousands of patients, many of them on Medicare and Medicaid.