Negotiators have reached consensus on some of the major issues involved in leasing West Jefferson Medical Center to LCMC Health, potentially paving the way for a final agreement that would see the local nonprofit company take over the public hospital, sources close to the negotiations said Thursday.
While the two sides appeared far apart just last month, with negotiators for the parish charging that LCMC was seeking to significantly change the terms of its previous offer, including the amount the parish would receive in exchange for the 30-year lease, the significant issues in the negotiations have been resolved and there appear to be few hurdles left, the sources said.
“For the first time, we can see the end in sight,” one source said.
Specific details of the agreement were not available Thursday. One person familiar with the negotiations said it appeared the final deal will be similar to LCMC’s earlier offer, though potentially somewhat less lucrative for the parish because of continuing financial issues at the hospital.
Several Jefferson Parish Council members contacted Thursday said they had not been updated on the negotiations recently but expect to hear more during a closed-door session next week.
LCMC officials would not directly comment on the status of the negotiations when asked Thursday.
“We are encouraged by the progress of the West Jefferson Medical Center negotiations,” LCMC Chief Executive Officer Greg Feirn said in a statement. “The leadership of Jefferson Parish has shown commitment to moving this process forward productively. We look forward to continued collaboration and hope to welcome WJMC into LCMC Health in the near future.”
LCMC runs Louisiana Children’s Medical Center, Touro Infirmary and the Interim LSU Hospital in New Orleans.
Negotiations are still underway on some aspects of the deal, and it could be some time before the council, which will need to sign off on the agreement, will be presented with a final contract.
The privatization of West Jefferson has been a complicated process that stretches back two years, when the hospital and its Metairie counterpart, East Jefferson General Hospital, began looking into privatization as a way to stem their deteriorating financial situations. But the boards of the two hospitals could not agree on which company should take over their operations, with West Jefferson favoring LCMC and East Jefferson preferring HCA, a national chain that runs Tulane Medical Center.
A divided Parish Council eventually agreed to let each hospital choose its own partner, though not before HCA dropped out of the running. The council then voted to start negotiations to allow LCMC to run West Jefferson even as Ochsner Health System, the only other company in the running, dropped its bid to run East Jefferson.
The negotiations since then have been private, though there were signs of significant disagreements earlier this summer. The parish’s negotiators charged that LCMC came to the two sides’ first meeting with a dramatically different proposal that would have meant a far less lucrative deal for the parish.
Those differences included changes to the amount LCMC would pay toward improvements to the hospital and the elimination of a section of the deal that would have seen LCMC take over about $33 million in pension liabilities from the hospital. It’s unclear exactly how those issues, seen as major sticking points in the deal, were resolved.
LCMC denied those allegations, saying the fact they became public was a sign of a dysfunctional process and at one point threatening to end the negotiations.
No decision on the future of East Jefferson General Hospital has been made.
Follow Jeff Adelson on Twitter, @jadelson.