RMC to affiliate with UAB Health Systems

Feb. 8—The Health Care Authority of the City of Anniston (RMC) Board of Directors and Leadership team announced today they have signed a non-binding letter of intent for Regional Medical Center to become an affiliate of the UAB Health System.

A press conference is scheduled at 1:15 p.m. today in Birmingham with RMC Board of Directors Chairman Jay Jenkins, RMC President/CEO Louis Bass, University of Alabama Birmingham President Dr. Ray Watts, UAB Health Systems CEO Dawn Bulgarella and UAB Health System Chief Network and Affiliates Officer Don Lilly.

In an exclusive interview with The Anniston Star Wednesday morning, Jenkins said the Regional Medical Center board gave its unanimous approval to the agreement Tuesday night. Bass said the RMC staff was notified at 9 a.m. Wednesday.

"We have been in an active search for a partner for our health care system," Jenkins said. "Providing quality health care has become increasingly challenging in a rural environment. As a smaller health system, there is not much negotiation posture as you struggle with expenses, the supply chain and a variety of different directions."

Jenkins described the search for a partner as "extensive" and one that has been ongoing for more than a year. The decision to begin exclusive talks with UAB was made in November with the bulk of the work happening within the last 30 days.

"We started with 25 suitors which was narrowed down ultimately to two," he said. "We are proud to be able to announce our decision to sign the letter of intent to have exclusive negotiations with UAB Health System for the purpose of becoming an affiliate of their health care system."

"We had a lot of good suitors from all over the Southeast," Jenkins said. "At the end of the day, UAB checked off more boxes than the others and we already have a relationship with them in some areas."

Bass said UAB's "reputation nationally, within the state and in this community and their willingness to reach out and let us remain with true local governance" was also a factor.

"It will not be a token board, but a board with at least half being from the community," Bass said. "That board will have real decision-making authority for budgets and future projects."

Both Jenkins and Bass said the term "non-binding" is simply one of process and the letter of intent allows both sides to have access to an even more comprehensive and detailed look at the other's data than was permitted in the search process.

"We are working on a definitive agreement," Jenkins explained. "There are certain requirements that have to be satisfied to ensure our community maintains quality health care going forward. There are certain requirements from UAB's side — whether it's governance or debt restructuring — that is important to them. They want to have an out and we want to have an out, too."

"The reality is with the players who are standing up to make the commitment, 'non-binding' is the legal term," Jenkins said. "When we all stand in front of the camera and microphones, there is a real responsibility that falls on all of us to come to a definitive agreement. The letter of intent does not define all the details but sets out a framework for reaching the final details."

Jenkins said the goal is to reach that final agreement within the next three to four months.

"We want to have it in such a form that at the UAB Board of Trustees meeting in June they will be able to ratify that agreement," Jenkins said. "We will be officially in at that point. It's just the process. It's not a negative at all. They see the merits in us as we see the merits in them. It's a mutual gain for both entities. We had other options, but we all felt this was the right direction."

Jenkins also noted the agreement was "informally endorsed" by the Anniston City Council during an executive session Tuesday night and Oxford Mayor Alton Craft had also been briefed on the potential agreement.

Bass said he and the board of directors gave priority to being the first ones to notify the staff of the news once the decision was made.

Bass said he began Wednesday morning meeting with all the RMC team leaders and the news "was very well received."

"That was followed up with a meeting of our medical executive committee leadership and our physician leadership," Bass said. "Those meetings were very positive with a lot of positive comments. We're excited. I think we all believe it's going to be great for the community."

Bass said the reaction from the UAB leadership "has also been so very positive."

"This arrangement would bring two outstanding health care organizations together," UAB President Watts said in a press release. "RMC is the flagship hospital for Northeast Alabama and this linkage would combine the strengths of the UAB Heath System with the outstanding care that RMC has provided their patients for years. We look forward to working with RMC to explore how this closer relationship could boost and enhance health care delivery for the residents of Calhoun County and all Northeast Alabama."

"I've called some of the major economic drivers in our community about the decision and they were very pleased," Bass said, noting RMC wants to be not only the place for quality health care "but also a major driver of economic development in our county, community and region."

Jenkins said UAB currently has three other primary affiliates "and we would be tiered at that level within their system."

"That means we will maintain our autonomy first as a hospital. We will still be RMC," Jenkins said. "But, we will have the backing, support and advantages UAB brings including specialty care doctors we currently don't have, the opportunity to grow service lines, the opportunity to improve our managed care and the opportunity to reduce the outmigration of physicians. These will yield positive gains that will allow for capital investment and growth in our system."

"We feel really good where we are," Jenkins said. "We are a good system. We are a proud system. We are in a good position and this was a perfect opportunity to find a partner that can carry us to the next level of health care and to ensure health care is extended for the foreseeable future in our community. We feel confident we will come to a final and binding agreement that will benefit all parties."

Staff Writer Brian Graves: 256-236-1551.