Louisiana's public hospital system last week offered to pay $45 million to buy the inner-city campus of Baton Rouge (La.) General Medical Center, whose parent corporation needs cash to pay off debts from its money-losing managed-care operations.
The LSU Health Care Services Division, which operates nine of the state's public hospitals, wants to move inpatient services out of the aging 204-bed Earl K. Long Medical Center in Baton Rouge. LSU Health Care has considered moving patients to Baton Rouge General, which can accommodate up to 400 patients, or building a new facility.
The offer countered a pitch made by Baton Rouge General's owner, General Health System, for a 25-year lease and purchase of services arrangement in which the state would pay approximately $80 million for use of space at Baton Rouge General. General Health's proposal included an option for the state system to buy the facility at the end of the lease for $1.
General Health Chief Financial Officer Dionne Viator promised a response by Sept. 18. She said she believes both sides are committed to a deal.
Although Baton Rouge General has been profitable, its parent organization has been under financial pressure because of losses at its managed-care operation, which was disbanded earlier this year (Aug. 27, p. 4). General Health received preliminary court approval to sell its nonacute-care assets, including two nursing homes and a psychiatric hospital, to repay the health plan's debts.
Baton Rouge General staffs about 200 beds at its inner-city campus. The hospital also operates a 104-bed satellite in Baton Rouge that is slated for expansion.