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Missouri attorney general raises issue with planned hospital merger

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The University of Kansas Health System and Liberty Hospital plan to come together, but Andrew Bailey says Missouri’s lawmakers must approve the deal.

Missouri Attorney General Andrew Bailey says state lawmakers must approve the University of Kansas Health System's planned acquisition of Liberty Hospital.

Image: Missouri attorney general

Missouri Attorney General Andrew Bailey says Missouri lawmakers must approve the University of Kansas Health System's planned takeover of Liberty Hospital. (Image: Missouri Attorney General's office)

Bailey has sent a letter to Missouri’s legislative leaders this week saying that the state’s House and Senate must sign off on the merger before it can go forward, KCTV reported this week. Both Liberty Hospital and KU Health say they disagree with the Missouri attorney general and plan to continue to move ahead.

In the letter, Bailey wrote, “a clear conflict between Missouri and Kansas law prohibits a Missouri political subdivision from entering an ‘interstate compact’ without approval from the Missouri General Assembly.”

Under Missouri state law, Liberty Hospital is a “political subdivision,” Bailey, a Republican, wrote in the Jan. 24 letter to lawmakers.

“A Missouri hospital district may not legally enter a management services contract with a political subdivision or instrumentality of Kansas without approval from the Missouri General Assembly,” Bailey concluded.

KU Health and Liberty Hospital first announced plans to come together in late October, and they signed a non-binding letter of intent to merge in November. Both organizations say they still look forward to a partnership.

In an email to Chief Healthcare Executive® Friday, Liberty Hospital said, "We assessed all applicable laws and regulations as part of the evaluation process for Liberty Hospital to join another health system. We disagree with the Attorney General’s assessment and welcome discussions as we continue due diligence toward final agreements.

"Our goal is to provide the very best health care close to home for Northlanders and the surrounding area. Joining The University of Kansas Health System does this and more," Liberty said.

Jill Chadwick, director of media relations for The University of Kansas Health System, said in an email Friday, “We disagree with the Attorney General’s assessment and welcome discussions as we continue due diligence toward final agreements with Liberty Hospital. We are committed to providing the very best health care to our region, as close to home as possible.”

Images: Liberty Health, KU Health

Raghu Adiga, Liberty Hospital’s president and CEO, left, and Bob Page, president and chief executive officer of The University of Kansas Health System.

Officials with Liberty Hospital have said they hope to reach a final agreement on the merger in early 2024. Based in the city of Liberty, a suburb of Kansas City, Liberty also operates 15 primary and specialty care clinics.

KU Health and Liberty Hospital have touted a host of benefits from the merger. KU Health has pledged to make substantial investments in Liberty Hospital and vowed to retain all employees. Officials also say it will expand specialty services to more residents of northwest Missouri.

When the deal was announced in November, Raghu Adiga, MD, Liberty Hospital’s president and chief executive officer, said the hospital has been seeking the right partner to preserve access to care.

“We believe The University of Kansas Health System is uniquely positioned to support us in bringing world-class clinical excellence to the Northland and northwest Missouri, making exceptional healthcare as close and convenient as it can be,” Adiga said in a statement.

Bob Page, president and chief executive officer of The University of Kansas Health System, said in November the deal would offer more access to cutting-edge care.

“Liberty and the region deserve access to the highest quality care close to home. Together, we can deliver the full spectrum of care while keeping care local,” Page said in a statement.

The planned merger has riled Missouri state Sen. Greg Razer. A Democrat, Razer opposes KU Health’s plans to take over a hospital in Missouri. He told the Missouri Independent the idea is “terribly wrong.”

“There are boundaries for a reason, and they’ve crossed one,” Razer told the Independent.

Razer has introduced legislation that would require voter approval for an out-of-state health system to take over a Missouri hospital or health facility, KHSB reported.

Missouri has already seen a major merger of health systems.

On Jan. 1, BJC HealthCare and Saint Luke’s Health System completed their merger, forming the BJC Health System. The integrated academic health system boasts $10 billion in revenue and operates 24 hospitals and more than 250 clinics. BJC is based in St. Louis, and Saint Luke's is based in Kansas City. Both brands will continue in their primary markets.


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