Lafayette General Health Signs Letter of Intent to Merge with Ochsner Health System

Combined system will be largest and most comprehensive healthcare provider in the Gulf South and will bring $365 million in investments to the Acadiana region
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NEW ORLEANS –Spurring a major development in both the regional healthcare system and the economy, the Board of Trustees of Lafayette General Health and Ochsner Health System have signed a letter of intent for Lafayette General to merge with Ochsner Health System. The combined organization will be the largest and most comprehensive healthcare provider in the Gulf South, enabling them to improve access to high quality healthcare across the region.

“Lafayette General is a tremendous health system known for high quality care and an extraordinary commitment to patients,” said Ochsner Health System board of directors chairman Andrew Wisdom. “We are proud of what we’ve been able to accomplish through our four-year affiliation, but we know we have only scratched the surface of what we can do together to strengthen access to services in the region and across the state.”

As part of the agreement, Lafayette General will anchor services as the regional healthcare hub in southwest Louisiana for the statewide health system, and Ochsner will invest $365 million in capital and resources in Acadiana over the next 10 years.

“Our vision is to truly improve the health of Louisianans and people across the Gulf South,” said Lafayette General Health Board of Trustees chairman David Wilson. “Just last year, Louisiana ranked as our nation’s least healthy state. By combining our resources and talent, we will be able to provide better access to healthcare here in Acadiana and to continue growing our local economy.”

According to a press release, the system will invest more than $50 million in expanding key services including pediatrics, women’s health, cancer services and more, as well as introduce pioneering behavioral health services the community desperately needs.

The partnership is meant to provide greater financial stability for University Hospital & Clinics, enabling the hospital to continue serving the most vulnerable members of the community. Additionally, a 10-year, $10 million Community Support Fund overseen by the Lafayette General Board will be created to advance health and wellness in Acadiana.

An investment in graduate medical education will be made at Lafayette General Medical Center to help train the physicians of the future. The system will add approximately 48 residency positions at the medical center, building on the 75 positions currently at University Hospital & Clinics and LGMC. Workforce development programs and continuing education to support employees will grow to include physician assistants, respiratory therapists, pharmacy assistants, registered nurses, surgical technicians and medical assistants.

All current Lafayette General employees will continue with the combined organization, and minimum pay will increase by nearly $2 to $12 per hour across the system, impacting 800 employees. The system aims to increase jobs over time, as services expand.

Lafayette General will maintain an open medical staff, allowing physicians to choose how they affiliate with the health system. The current leadership team and Board of Trustees will continue to guide the system and provide operational oversight. Lafayette General will keep its name and co-brand with Ochsner after completion of the merger.

The combined system will invest in further development of digital health tools at Lafayette General to empower patients and lower the cost of care. In addition, $1 million will be invested in the Healthcare Innovation Fund at the Lafayette General Health Foundation to further digital medicine and technology initiatives in Acadiana. The Fund, which started in 2016, supports healthcare startup businesses across the region.

Drivers for Partnership

Across the country, strong health systems are coming together to make healthcare better and more affordable for their communities. In fact, over the past three years, 307 hospital partnership transactions have been announced in the United States, and in 2018, five partnership transactions were announced in Louisiana alone. Industry headwinds require significant expertise, resources and scale for health systems to succeed and to meet the evolving needs of their communities.

“As two of the leading health systems in our state, we have the responsibility to improve quality and safety, increase access and make healthcare more affordable,” said Ochsner Health System president and CEO Warner Thomas, FACHE. “It’s no secret that we face a number of critical health issues in Louisiana – rising incidences of hypertension, obesity, chronic disease and growing demand for key services such as oncology care, stroke care, women’s and pediatric services and more. Joining together, we can tackle these issues to improve healthcare much faster than we can by working alone.”

Signing the letter of intent to merge with Ochsner Health System is the first step in a process that will take several months to complete. Both organizations will now enter into a period of due diligence and seek required regulatory approvals. The merger is expected to be finalized in the spring of 2020.

To keep physicians, employees and the community informed about the partnership and what it means for them, a website has been launched at: www.LeadingTogetherLA.org.

 

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