UofL Health to Expedite Repayment of State Loan
Louisville, Ky – Now entering its third year as a comprehensive academic health system, UofL Health credits state support for helping to build its positive financial performance. The system was formed in 2019, when UofL Health acquired several Louisville region facilities from a former struggling owner, with the help of a $35 million partially forgivable loan from the Kentucky Economic Development Finance Authority (KEDFA). Repayment of the loan was scheduled to take until 2039, but UofL Health has agreed to expedite, concluding payments on the balance due in April 2025.
“Our 12,000 health care heroes are the key to UofL Health’s success, but we share this credit with the entire Commonwealth,” said Tom Miller, UofL Health CEO. “Kentucky understood the critical need to preserve health care services, jobs and expand access in underserved areas. Kentucky invested in UofL Health and Kentucky is reaping the return.”
Today, drawing patients from each of Kentucky’s 120 counties, plus neighboring states, UofL Health is a fully integrated regional academic health system. It provides care to more than 1.5 million patients each year.
“I specifically want to thank Governor Beshear, Senate President Robert Stivers, Senate Minority Leader Morgan McGarvey, House Speaker David Osborne, and House Minority Leader Joni Jenkins. They understood the critical need to preserve these health care resources,” said Miller. “With their support, we saved more lives, more jobs and now we are growing. UofL Health is in a strong position to further increase access, decrease barriers and train more nurses, doctors and other clinicians.”
The loan, initially approved by KEDFA in 2020, was intended to absorb short-term operating losses and capital expenditures while the system was coming together. Under the amended terms, approved during KEDFA’s December 9th meeting, UofL Health will begin payments in April 2022, concluding in April 2025. Other details of the loan agreement remain unchanged, including the ability to forgive up to 50% of each annual loan payment based on meeting one of two conditions:
- Retain 5,880 full-time, Kentucky-resident jobs being paid an average hourly wage, excluding benefits, of at least $35.
- Continue operating existing facilities, open at least one additional facility within a Medically Underserved Area (MUA) and increase the total number of family medicine access points, from 10 to 14 in the MUA.
To date, UofL Health continues to meet and exceed both conditions. The system now employs more than 7,900 full-time employees, with an average hourly wage exceeding $60. The facilities from the former struggling owner, are all now financially sound and access points have grown. In the last year, UofL Health opened two new Urgent Care Plus locations in MUA’s and 107 physicians have been recruited to improve care in the underserved population.
UofL Health spent the $35 million KEDFA loan for critical upgrades and equipment needs at the acquired facilities. The biggest project was a replacement of the IT infrastructure to support electronic medical records. Other significant projects include surgery power equipment, establishing a geropsychiatric unit and redevelopment of an epilepsy unit at UofL Health – Jewish Hospital; a cath lab and detox unit at UofL Health – Mary & Elizabeth Hospital; expansion of 10 additional beds for UofL Health – Frazier Rehabilitation Institute; air conditioning upgrades for UofL Health – Shelbyville Hospital.
In addition to the capital expenses funded through the loan, support from the Legacy Foundation of Kentuckiana, Jewish Heritage Fund for Excellence and UofL Health’s operating revenue has supported many more projects to improve care across the region and Commonwealth., Over the last two years, $115 million was invested into existing facilities. The Brown Cancer Center expanded to two additional locations. Shelbyville Hospital recently opened a 6-bed Intensive Care Unit and two new hospitals are on the way. In Bullitt County, UofL Health – Medical Center South is evolving into a full-service hospital with 60 inpatient beds. Frazier Rehabilitation Hospital – Brownsboro, in partnership with Kindred Healthcare, a 40-bed rehabilitation hospital now under construction in east Louisville.