Hospital manager says it paid nearly $7M for debt tied to privatization of LSU hospitals



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BATON ROUGE, Louisiana — The research foundation running the LSU hospitals in Shreveport and Monroe said it paid the university system nearly $7 million Friday for back-owed debts tied to privatization, less than one-third of the amount demanded by LSU in a collection letter this week.

The Biomedical Research Foundation of Northwest Louisiana, or BRF, said it placed another $10.6 million into escrow, saying it will be disbursed to LSU once remaining financial terms are worked out. The foundation said in a statement that it will cover the balance of what is owed to the university system.

LSU health care adviser Jerry Phillips said he didn't know if the foundation had wired any money — but said the university system and BRF hadn't reached an agreement about how much was unpaid. He said the $17 million offered by the foundation is "way short of $25 million" that LSU is owed.

"We still don't have an agreement on what the numbers are," Phillips said.

The research foundation took control of the two hospitals in October 2013 and operates them as University Health System, as part of Gov. Bobby Jindal's push to privatize most of the university-run public hospital system. The foundation had never previously run a patient facility.

In a letter sent this week, LSU accused the foundation of using it like a "personal piggy bank" and said it was owed $25.3 million in unpaid debts, money that the university system said it needed for the medical school operations in Shreveport. LSU claimed the foundation also hasn't completed a list of ancillary agreements related to hospital operations.

In a response email, Stephen Skrivanos, chairman of the research foundation's board, blamed LSU for making the privatization management transition more difficult than necessary. He accused university officials of trying to demand the hospital managers sign agreements that are not consistent with its business purposes, and he said LSU was inflating what it was owed.

The angry exchange of letters comes only a year after the privatization deal was reached. At the time, the Jindal administration and university leaders championed the contract as a way to improve health care for the poor and uninsured who rely on the hospitals for care and to bolster the medical training programs that use the facilities.

The foundation's president, John George, is a Jindal campaign contributor who was one of the Republican governor's appointees to the LSU Board of Supervisors at the time the privatization contract was crafted.

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