New Orleans — A potential public-private partnership that would allow the owner of Children’s Hospital and Touro Infirmary to operate the new University Medical Center came one step closer to reality Thursday when the UMC’s board voted to approve a memorandum of understanding with Louisiana Children’s Medical Center.
The University Medical Center Management Corp. board of directors voted 8-0 in favor of the MOU, with members Alden McDonald, Dr. Chris Rich and David Voelker absent.
Under the proposal, the LCMC would operate Interim LSU Public Hospital and eventually the UMC that is under construction in Mid-City.
The LSU Board of Supervisors must now also vote on the plan. That is scheduled to happen Friday morning.
Officials said the move is necessary to avoid cuts to programs and personnel at the facility that otherwise would have been necessary as the state tries to plug a $300 million hole between revenues and costs in the hospital budget. The gap is due to Congress’ reduction in the amount the federal government pays for its part of Medicaid, leaving the state to pay more than it expected.
The decision to remove day-to-day operation from the board was welcomed by several speakers who railed against the current management. Their main point of contention involved the decision to bulldoze several dozen blocks in Mid-City to build the new teaching hospital, rather than reopen Charity Hospital after Hurricane Katrina.
UMC Management Corp. Chairman Bobby Yarborough said that the board viewed the nonprofit LCMC as a good fit to run the new interim and future hospitals because of its business model and medical education components.
Greg Feirn, chief financial office for Children’s Hospital, said that the LCMC is suited to run the UMC since many combined figures from Children’s Hospital and Touro are equal to or greater than what Interim LSU Public Hospital deals with each year.
“The alternative is pretty bleak,” Tim Barfield , a board member and executive counsel for the state Department of the Revenue, said a few minutes before the vote happened.