Owensboro Health in deal with Leitchfield hospital, which says it sought partner because of rising costs, declining reimbursements

Twin Lakes Regional Medical Center is in Leitchfield.
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Owensboro Health, which absorbed Muhlenberg Community Hospital in Greenville five years ago, is preparing to do likewise with Twin Lakes Regional Medical Center in Grayson County.

The two “have signed an official letter of intent, an agreement that opens the door for the Leitchfield-based hospital to officially join Owensboro Health later this summer,” they announced. “The letter of intent is the first step toward more a more formalized affiliation agreement.”

Directors of the 75-bed hospital and the county taxing district that supports it picked Owensboro Health from other potential partners, which they did not reveal. The closest major hospital, 300-bed Hardin Memorial Hospital in Elizabethtown, about 30 minutes from Leitchfield, recently became part of Baptist Health, the state’s largest hospital chain. The Owensboro hospital, an hour away, has 475 beds.

“More than any other prospective partner we met with, Owensboro Health demonstrated a commitment to our people, our strategic objectives and our vision for the future,” the directors said in a Q-and-A sheet that the hospital issued in response to questions.

The directors said they were impressed by the experience of the Greenville hospital, which since joining Owensboro Health “has grown in terms of revenue and patient volumes and earlier this year received a five-star rating from the U.S. Centers for Medicare and Medicaid Services, making it one of only three five-star rated hospitals in Kentucky.”

Twin Lakes, a familiar site to motorists on the Western Kentucky Parkway, “was and is in a solid financial position,” they said, but “the board was concerned that the costs of providing care were increasing while reimbursements were decreasing, a situation that is not sustainable and will only become more challenging.” Many rural hospitals have affiliated with, or sold to, larger hospitals or chains.

The county-owned hospital described the deal this way: “This is an affiliation/partnership of our patient services, medical staff and employees. The real property of the hospital and related facilities will continue to be owned by the Grayson County Hospital District and leased to TLRMC. . . . The local community will continue to have substantial representation on the governing board of the hospital, and Owensboro Health has made a commitment to make substantial capital investments in TLRMC, fund a new community charitable foundation, and establish an integrated electronic medical-record system.”

Before the letter of intent was announced, Owensboro Health agreed to take critically ill covid-19 patients from TLRMC, whose administrator, Wayne Meriwether, said it has six ventilators, only two of which “will do what needs to be done to give covid-19 patients their best chance at survival.” He said “Owensboro Health has probably treated more covid-19 patients than any other hospital in the state, so they’re prepared.”