New federal policy means fewer life-saving liver transplants in Ky., say top medical officials at major universities, who are fighting it

By Mark Newman, Tom Miller and Kelly McMasters

A rushed proposal that became federal policy across the country this month will increase the cost and decrease access to life-saving care for patients in dire need of a liver transplant across much of the South and Midwest.

The result: People in Kentucky and largely rural areas of the country will be more likely to die because they won’t receive the care they need or would have had access to before this month.

As health care professionals and leaders of the state’s two academic medical centers, we are doing everything we can to delay or reverse this detrimental policy. Here’s what is happening and what is at stake for Kentucky:

On Feb. 4, the Organ Procurement and Transplantation Network, based on a recommendation from the United Network for Organ Sharing, implemented a new policy for how livers are allocated around the country for potential transplant. The OPTN sets transplantation policy at the direction of the U.S. Department of Health and Human Services.

The basic framework of this policy would mean more organs in rural states, like Kentucky, would be sent to larger inner-city medical centers that have higher populations. The idea was to create a policy that ensured more critically ill patients (within 500 nautical miles) received access to livers, rather than the patients in closer proximity.

While the transplant policy is well-intentioned, the fact is the governing board creating and directing the policy is dominated by officials from large urban, coastal areas. The resulting policy benefits those areas.

The process creating this program was rushed and the policy is deeply flawed.Even the framers of it concede there will be nearly a 30 percent drop in liver transplant volume in Kentucky as a result of this policy. We believe the drop will be even more significant, on the order of 40%.

Kentucky, as so many of us know, has a higher mortality rate for chronic liver disease such as cirrhosis than the national average. In rural areas of our state, the rate is even higher as access to care is more limited.

Several things -- all negative -- will occur in Kentucky and other rural areas of the country:
•This new policy will decrease access to livers for transplant even further.
•It will increase costs, the result of a more inefficient system because of rising costs for flights, fuel and transportation for Kentuckians and others who will have to travel farther to receive transplantation services.
•It will result in longer waiting periods and poorer health outcomes for Kentuckians and others who have to wait longer for donated livers.
•Others, who have to wait and who don’t have time, will be more likely to die.

We stand with a network of academic medical centers throughout the South and Midwest, including Emory University, the University of Michigan, Vanderbilt University and the University of Virginia, that have filed a lawsuit, asking to prohibit the federal government from implementing the policy. Although the federal court in Atlanta declined to stop the government from implementing the policy on Feb. 4, the fight is far from over.

We are continuing to ask the court to order the federal government to seek additional input. Ultimately, the federal government must craft something more equitable for everyone in America, not just those in larger cities or on the coasts.

We have received support from many federal policymakers, led by Senate Majority Leader Mitch McConnell. However, we continue to appeal to others to do what they can, with the voices and power they have, to prevent or reverse implementation of this ill-advised and biased approach to transplantation care.

We need, and respectfully ask, those in power to listen and act. For so many people, time is running out.

Mark Newman is chief executive of UK HealthCare; Tom Miller is chief executive officer of UofL Health; Kelly McMasters is chair of UofL's surgery department.

Conference speakers call for a more aggressive approach to eliminate hepatitis; Ky leads the nation in both hepatitis A and C

By Melissa Patrick
Kentucky Health News

Elimination of the three main types of hepatitis is possible, but will require a more aggressive approach that includes increasing vaccinations for hepatitis A and B and universal screening, non-restricted access to treatment and increased access to harm-reduction programs for those with hepatitis C.

That's been the unwavering message about the liver disease for the the last few years at the Kentucky Rural Health Association's annual Viral Hepatitis Conference, and it was again at the one held July 31 in Lexington.

Meanwhile, Kentucky leads the nation in both acute and chronic cases of hepatitis C and has the largest outbreak of hepatitis A in the nation, and how the state has managed these highly contagious liver diseases has come with both kudos and criticism.

Hepatitis C

Kentucky is often praised for its progressive response to hepatitis C, a chronic disease that is estimated to affect about 43,000 Kentuckian.

But about half of people with hepatitis C don't know they have it, according to Dr. Neil Gupta, chief of the Epidemiology and Surveillance Branch in the federal Centers for Disease Control and Prevention's Division of Viral Hepatitis.

Kentucky is recognized nationwide for its embrace of syringe-exchange programs, which allow drug users to swap dirty needles for clean ones to thwart the spread of HIV and hepatitis C, as well as offering other "harm reduction" services. Most new hepatitis C cases result from drug users sharing needles.

As of June 2, Kentucky had 62 operating syringe exchanges in 55 counties, with four more approved but not yet operational.

Mike Selick, with the national Harm Reduction Coalition, pointed to other ways Kentucky leads the nation in harm reduction, including its Good Samaritan law, its standing order for a drug that is used to reverse opioid and heroin overdoses called naloxone, and its efforts to increase access to medication-assisted therapies (MAT) such as buprenorphine.

That said, he also offered examples of how Kentucky could improve its harm-reduction programs, such as increasing the days and hours that syringe exchanges operate; getting rid of any requirements that the exchanges be one-for-one; increasing access to naloxone and MAT in rural areas; and getting rid of any prior-authorization insurance requirements for MAT.

Kentucky got a "B" on the report card, "Hepatitis C: State of Medicaid Access," largely because it provides "moderate access" to treatment. The report, and several speakers at the conference, called for removal of specialist restrictions in treating hepatitis C and for managed-care organizations, which care for most Medicaid patients, to follow the Medicaid fee-for-service guidelines and not impose any restrictions for liver damage or sobriety for people seeking treatment for the first time.

Selick stressed that hepatitis treatment is safe and effective for people who inject drugs, pointing to research that shows reinfections rates in this population are low. Further, he said treating this population early in their infection becomes "treatment as prevention," because it would decrease the spread of the disease.

Jon Zibbell, senior public health scientist for RTI International, an independent, nonprofit research institute, noted that people who inject drugs present the largest population of new hepatitis infections, and that only 1 to 2 percent of them are being treated each year.

"This population needs to be treated if we are to stop incident infections and achieve hepatitis C elimination," Zibell said. "We cannot achieve hepatitis C elimination if we don't massively treat people who are . . . injecting drugs, and a lot of the pay restrictions are getting in the way of that."

The state health department has launched a statewide hepatitis C elimination project to create a comprehensive and statewide strategic plan to eliminate the disease. It met for the first time July 29.

In 2018, Kentucky was the first state to pass a law to require all pregnant women to be tested for hepatitis C. The law also requires that the information be recorded in both the mother's and the infant's records, and that the child be tested at 24 months for the disease. One in 63 Kentucky births are to mothers who test positive for hepatitis C.

Gupta told the group that subject to change after public and peer-review comment, the CDC would be changing its guidance on hepatitis C screening next year to recommend it for all pregnant women, at least once in a lifetime for all adults, and periodic testing for people with risk factors.

The Kentucky Rural Health Association has started a nationally recognized provider training program called  the Kentucky Hepatitis Academic Mentorship Program, or KHAMP, which so far has trained over 100 providers to treat hepatitis C.

Hep C treatment comes at a cost

One of the challenges to treating hepatitis C is the cost, though an argument can be made that it is more expensive to care for these patients when they progress to late-stage liver damage, liver cancer or need a liver transplant.

Dr. Bennett Cecil, medical director of Hepatitis C Treatment Centers in Louisville and Russell Springs, told the group that the cost for a treatment has dropped to upwards of $30,000, down from about $80,000 several years ago.

Kathleen Winter, as assistant professor in the division of epidemiology at the University of Kentucky College of Public Health, offered some numbers to show the scope of the problem.

Her slides showed that in 2017 Kentucky screened 70,270 people on Medicaid for hepatitis C, and 21,322 of them, or 30 percent, were diagnosed with chronic hepatitis. Only 499 were treated. In 2018, when the state loosened its treatment restrictions, Medicaid screened 79,647 people, 22,342 of them were diagnosed with a chronic infection, and 1,924 were treated.

Winter also showed cost data from the Kentucky All-Payer Hospitalization Claims database that found in 2018 there were 2,973 hospital admissions for patients who had both hepatitis C and liver disease or liver cancer, and that these patients incurred more than $181 million in patient pre-negotiated charges. Adjusted, she said, that would be upwards of $90 million a year to treat chronic, late-stage hepatitis C.

It also found 68 admissions related to liver transplants associated with hepatitis C, which had $4.8 million in associated cost. She said most of these patients were either on Medicare or Medicaid.

While most of these patients were older, Winters pointed out that the largest burden of the disease is with younger adults, who are largely in the early stages of the disease process, and who if not treated will present a tremendous cost-burden to the health-care system in years to come.

Winter also presented her research on pregnant women on Medicaid with hepatitis C, which found that many of them could not correctly identify their hepatitis C status, even though they had been tested; many did not understand how the virus was transmitted; many knew it could be treated, but didn't know what that treatment entailed; many knew treatment was important, but had widespread misunderstandings about what Medicaid would cover -- which Winter said was also a widespread problem among medical professionals.

Hepatitis A

Kentucky has made great progress in decreasing its number of new hepatitis A cases, but not without criticism for what some say was a slow response to the nation's largest outbreak of the disease.

Since August 2017, there have been 4,793 cases of hepatitis A in Kentucky, with more than half of them hospitalized (2,311) and 59 dead from it, according to a weekly surveillance report. The primary risk factors for hepatitis A are drug use and homelessness.

Andy Beshear addressed the conference.

Attorney General Andy Beshear, the second speaker of the day, was quick to criticize Gov. Matt Bevin's administration for its slow response to the hepatitis A outbreak. Beshear is running against Bevin in the Nov. 5 gubernatorial election. 

To a room full of applause, Beshear first thanked Dr. Robert Brawley, the state's former infectious-disease chief, for his "courage in doing what is right," even though it cost him his job. Brawley is a volunteer with KRHA and was a co-moderator of the event.

Beshear was referring to Brawley's request that the state have a more aggressive response to the outbreak, including $6 million to buy more vaccines and $4 million for temporary health workers to help administer them. Brawley also called for the state to declare a public-health emergency as a way to get more federal funds, the Louisville Courier Journal reported.

Health Commissioner Jeffrey Howard didn't declare an emergency but sent local health departments $2.2 million and committed to seek more funding if needed. Howard and other state officials have defended their actions, citing that logistical challenges were greater than the need for more money as the outbreak spread to rural Kentucky.

Brawley, who was allowed to resign in lieu of being fired on June 4, 2018, has maintained his position that the state has not acted aggressively enough.

Beshear said, "I think when you also look at hepatitis, we see an absolute failure by the Bevin administration that cost people their lives. They had the information, they had the ability to respond in a real way for only about $10 million, but they didn't listen. Instead they had people inexperienced and incompetent in really important positions."

The health cabinet stood by its decisions, stating in an e-mail that their response to the outbreak "followed protocol and procedures guided by the CDC and informed by an entire DPH team."

"While hindsight might provide more context for some things now, in retrospect there's not a single decision that I'm aware of that has been made in real time, with the information available at the time, that I would change," Health Secretary Adam Meier said in the e-mail.

Howard, a physician, recently resigned as commissioner to pursue a fellowship in Washington, a spokeswoman from the cabinet told the Courier Journal.

Maria Hardy, the public health director at Ashland-Boyd County Health Department, painted a pretty grim picture of the financial cost associated with the outbreak. Boyd County has been one of the counties hardest hit by the outbreak, with an incident rate of 362.7 cases per 100,000 people.

Because many of the people testing positive for hepatitis A in Boyd County kept showing up in the food-service industry, at the health department's recommendation the county passed an ordinance requiring all food workers be immunized against hepatitis A.

Hardy said her health department's hepatitis A costs have been "devastating to budget." From January 2018 to June 2018, the agency spent $718,902, including the cost of salaries, vaccines and certified mailings. She added that the department got $183,520 from the state to buy more vaccine.

Looking to the future

To applause, Zibbell suggested that it was time to turn syringe-exchange programs into medical homes for people who use drugs, largely because of the stigma in traditional health-care settings against this population.

Dr. Daniel Moore, of the emergency-medicine department at UK HealthCare, said emergency departments must play a significant role in eliminating hepatitis C because they see the "downstream" effects of the disease and are the only places that most drug users interact with the health-care system.

Moore is conducting a grant-funded pilot study that allows him to screen every patient in the UK emergency department for hepatitis C. He said research shows that risk based screening would miss about 25% of people who would test positive for hepatitis c.

Between July 2018 and July 2019, he said the ED had done about 23,000 tests, with about 11% of them testing positive for ever having been exposed to hepatitis C and more than 50% of that group testing positive for an active virus. He added that 443 of these patients had been linked to care.

He said the next step toward elimination of this disease will be to bring drug treatment and hepatitis C interventions to the point of contact in the ED, just like they already do for patients who have had a stroke or a heart attack.

"This is a disease that has a cure," he said. "The patients are in front of me and there is a cure."

As Jewish Hospital struggles, so does its organ-transplant program, with bad implications for U of L and regional health care

"Jewish Hospital’s pioneering transplant program is in trouble, and its demise could produce far-reaching repercussions" on the greater Louisville area, reports Boris Ladwig of Insider Louisville.

"Surgical teams have performed only one heart transplant in the first six months of the year, according to the most recently available data, running afoul of federal minimum requirements," Ladwig reports. The program is also under threat that the hospital, which has been unable to find a buyer, might close altogether.

The transplant program is linked to the University of Louisville's hospital and its medical school. U of L told Ladwig that it would keep supporting the program, “either at Jewish or in another location.” That would require new certification from the federal Centers for Medicare & Medicaid Services, "which would take more than a year and cost the university millions of dollars," Ladwig reports.

"Even more worrisome, the national consultant told Insider that an interruption of the transplant program could prompt an exodus of transplant surgeons, which could lead to departures of medical staff in transplant-related subspecialties," Ladwig adds. "Those developments could jeopardize UofL Hospital’s status as a Level 1 trauma center [one of only two in the state], and cause it to lose medical residency spots."

That helps explain "the increasing desperation with which university officials in the last few months have tried, so far in vain, to save the struggling Jewish Hospital, which, together with related facilities, has been losing more than $1 million per week."

KentuckyOne Health, has been trying to sell Jewish and seven other facilities in Louisville, and Jewish Hospital Shelbyville, for more than two years. The university in December "tried to find a partner to acquire the properties, primarily to save Jewish Hospital," but that failed, Ladwig notes.

U of L declined to comment on why the number of heart transplants has declined, but KentuckyOne blamed a national change in how hearts are allocated. The United Network for Organ Sharing told Insider that it changed the allocation policy in October, partly "to better identify the most medically urgent transplant candidates," Ladwig reports.

Insider Louisville chart

That does not seem to have had as much impact on other transplant centers in the region. "The University of Kentucky Medical Center is on pace to perform 24 heart transplants this year, which would be a drop of 17 percent," Ladwig reports. "Nationally, transplants are on pace to be down 12.6%."

Other types of transplants "have seen a precipitous decline at Jewish Hospital," Ladwig writes. "Kidney transplants are down 56%, liver transplants are down 29%. Both have fallen just 11% nationally. Only lung transplants at Jewish are in line with national declines.

Under the bylaws of the Organ Procurement and Transplantation Network, "heart-transplant programs that fail to perform at least one transplant every three months are deemed to be functionally inactive," Ladwig notes. "OPTN and UNOS manage the U.S. organ transplant network by contract with the federal government. The agency’s website lists no action against Jewish Hospital. UofL said it has not been notified by anyone to say the program is inactive or out of compliance."

Dr. Peter Hasselbacher, an emeritus professor of medicine at U of L, "who has written extensively about the transplant program at Jewish," told Ladwig that any heart-transplant program that does fewer than five a year “shouldn’t be doing any,” due to lack of practice.

"CMS guidelines call for transplant programs to perform 10 heart transplants over any 12-month period to retain certification," Ladwig reports. "The agency could not be reached to explain what happens to programs that fail to meet that threshold."

U of L can't find a partner to buy Jewish Hospital, but will continue professional partnership on education, transplants etc. 'for now'

Jewish Hospital and its Rudd Heart and Lung Center

Failing to find the partner it says it must have, the University of Louisville has suspended efforts to buy Jewish Hospital and the other Louisville-area assets of Catholic Health Initiatives, operated as KentuckyOne Health. The failure leaves in limbo the future of a major Kentucky hospital and its affiliated health-care facilities.

“U of L officials were not willing to put the university at financial risk by taking on the acquisition alone,” the university said in a news release. “We regret ending our talks with CHI but we must do what is fiscally responsible for the University of Louisville,” U of L President Neeli Bendapudi said in the release. “Without a viable partner, we do not have the resources necessary to make the acquisition a reality.”

"KentuckyOne and U of L will continue their professional partnership for now, including the academic affiliation agreement that ensures undergraduate and graduate/resident medical education programs continue at Jewish Hospital and Frazier Rehab Institute," report Morgan Watkins and David Harten of the Louisville Courier Journal. "If the programs cannot be continued at those facilities, CHI will assign those residencies to another facility requested by the university, according to U of L’s statement Wednesday."

University spokesman John Karman "said U of L is continuing to make progress on contingency plans that it has been working on since last year concerning the transition of its service lines from Jewish Hospital to other health care facilities," the newspaper reports. "More than 1,000 employees work at the hospital. Jewish also serves as the only adult organ transplant center in the city, and all of the physicians who perform lung, kidney, liver, pancreas, heart and dual organ transplants at Jewish are employed by U of L."

KentuckyOne's assets have been for sale for more than two years. Besides Jewish and Frazier Rehab, they include Sts. Mary and Elizabeth Hospital, four outpatient centers, Our Lady of Peace psychiatric hospital and Jewish Hospital Shelbyville.

U of L withdrawal of some services from Jewish Hospital puts Louisville's only adult organ transplant center at risk

Jewish Hospital has a prominent place along
Interstate 65. (Courier Journal photo by Sam Upshaw)

"The University of Louisville may soon stop providing important medical services at Jewish Hospital — a move that could jeopardize the only adult organ transplant center in the city" and one of only two in Kentucky, Morgan Watkins reports for the Courier Journal. "All of the physicians who perform lung, kidney, liver, pancreas, heart and dual organ transplants at Jewish Hospital are employed by U of L, according to the university."

U of L President Neeli Bendapudi said last month that the university was starting to move some medical services from Jewish to University of Louisville Hospital and elsewhere because of "the current uncertainty around" Jewish, which is for sale and at risk of closing.

"If the university is no longer providing the surgeons to do transplants, then there’s nobody to do the transplants at Jewish Hospital. It’s not like you can bring in somebody overnight," colorectal surgeon Wayne Tuckson told Watkins. He works for KentuckyOne Health, the Catholic Health Initiatives subsidiary that owns Jewish. CHI, which has had financial problems, is merging with Dignity Health of San Francisco.

"U of L has been making contingency plans for its solid organ transplant program, but shifting such operations from one hospital to another isn't an easy or quick process, according to Laura Aguiar, principal and managing partner of Transplant Solutions LLC, which works with transplant programs around the country," Watkins reports. The other transplant programs in Kentucky are at Norton Children's Hospital in Louisville and the University of Kentucky.

Two big contracts between KentuckyOne and U of L expire at the end of this month, Watkins notes: "Under those agreements, KentuckyOne agreed to provide a minimum of about $35.6 million to the university for 56 medical resident positions at Jewish Hospital and the Frazier Rehab Institute, as well as for a variety of services performed by U of L employees, including heart and brain surgeries. . . . Also, U of L physicians serve as medical directors for the lung and liver transplant programs at Jewish. Even Jewish's chief of surgery works at U of L's school of medicine."

KentuckyOne spokesman David McArthur told Watkins, "An agreement is not required for U of L physicians to practice at Jewish Hospital, and we welcome and encourage their continued service. Our desire and intent is to continue to provide comprehensive services for the community. If the university chooses to relocate their physicians to other area hospitals, it will impact the services available at Jewish Hospital." He said the company and the hospital are still in "productive discussions." Watkins reports KentuckyOne has agreed to fund the 56 U of L residents at Jewish Hospital and the Frazier institute through June 30.

Dangerous and stealthy, non-alcoholic fatty liver disease is on the rise, but is reversible with weight loss and exercise

Many Kentuckians and other Americans are walking around with a liver disease that has the potential of progressing to cirrhosis, which can then lead to liver failure, and don't even know it, according to a Houston Methodist Hospital news release.

It's called non-alcoholic fatty liver disease. NAFLD is caused by the buildup of extra fat in the liver that is not caused by alcohol. And while it is normal for the liver to contain some fat, if more than 5 to 10 percent of its total weight is fat, it is considered a fatty liver.

“Data has shown that nearly 30 million Americans have NAFLD. Many times it is missed until the person’s liver enzyme levels are high,” Dr. Howard Monsour, chief of hepatology at Houston Methodist Hospital, said in the release.

Alcohol, drugs, obesity, high cholesterol and diabetes, which are more common in Kentucky than the rest of the nation, can all be causes of fatty liver. The release notes that those with Metabolic Syndrome often also have fatty liver.

Metabolic Syndrome is a combination of health conditions in one person that include abdominal obesity, high blood pressure, increased fasting glucose levels and abnormal cholesterol levels. More than one-third of adults in the U.S. suffer from this syndrome.

Fatty liver in its early stages is harmless, but it can advance to a condition called nonalcoholic steatohepatitis (NASH), then to cirrhosis. But the good news is, if it is caught early, it is a totally reversible condition through slow, methodical weight loss and exercise.

“Much like Type 2 diabetes, NAFLD can be cured with proper diet and exercise,” Monsour said. “If you lose 12 percent of your current weight, no matter how much you weigh, you can eliminate fat from your liver.”

Most people with fatty liver or NASH have no symptoms, but some have fatigue, weakness and loss of appetite, or pain in the center or right upper part of the belly. "These symptoms might also get worse after heavy drinking," the release notes.

Those with fatty liver shouldn't overindulge in food or alcohol because it can make the condition worse, "and possibly lead them straight to a heart disease and/or liver failure," the release warns.

Fatty liver is the leading cause of chronic liver disease and is the third most common reason for liver transplants in the U.S., according to the American Liver Foundation. Between five and 20 percent of people with fatty liver will develop serious liver disease, according to the release

“The key is to catch it early and many times it may not be discovered until a routine checkup,” Monsour said. “If you start to experience symptoms, see a doctor as soon as you can. Letting it go without evaluation can lead to a very difficult, unhealthy life.”

UK Healthcare says it must get even bigger, and expand its market area, to provide needed services to Kentucky

By Molly Burchett and Al Cross
Kentucky Health News

The University of Kentucky's health-care system has grown by leaps and bounds in the last decade, becoming one of the state's largest businesses, but its boss says it must expand its geographical reach to maintain its newly raised national status and to ensure access to quality care for Kentuckians.

Over the last decade, UK HealthCare’s caseload has increased 85 percent, and its annual hospital budget has increased from $300 million to $922 million, Dr. Michael Karpf, executive vice president for health affairs, said in an interview.

This explosive growth, in addition to the growth of the UK medical school, has jacked up the enterprise's national ranking. It has grown from about the 85th largest academic hospital in the U.S. to approaching the 35th largest in terms of total discharges, the benchmark it uses. That means it has jumped from the bottom third to the top third in less than a decade. (For a more precise measurement over time, based on a Council of Teaching Hospitals standard, see chart.)

The push for growth and development began in 2003, after UK's caseload hit a plateau even though the 1998 General Assembly had mandated it to become a top 20 public research institution. Karpf came aboard and combined the Chandler Medical Center, clinics, faculty practice plans and the College of Medicine into a single integrated system of care -- branded as UK HealthCare -- which he commands. Good Samaritan Hospital in Lexington was added in 2007.

"Ten years ago people viewed this a safety-net hospital," Karpf said of the Chandler facility. "We've had to redo the brand." Now more people are choosing the hospital, as suggested by who's paying the bills. Medicare now covers a plurality of the patients; a decade ago, it trailed Medicaid, the program for the poor and disabled. In that time, the total caseload grew 7.2 percent; Medicare cases rose 10.9 percent.

But despite the huge growth in the last decade, the enterprise is still not big enough, Karpf said.

"We want the hospital to be the first choice when it comes to complex care,” he said. “We must advance to better serve the health-care needs of Kentucky.” To do this, he said, UK HealthCare is rejuvenating its brand as "Kentucky's Best Hospital," with a broad range of advanced specialties to keep Kentuckians from leaving the state for care, and is moving to expand its geographic reach to Western Kentucky and out-of-state markets.

Karpf said UK must expand because its traditional market, approximately the eastern half of the state, is not large enough to provide the number of cases that UK will need to receive certification as a federal “Center of Excellence” for complex services like brain surgery and heart, liver, kidney and lung transplantation. He said such a designation will be necessary to get enough referrals from doctors and smaller hospitals to maintain these services and to guarantee that Kentuckians can get the care they need inside the state. "What we make money on is the complex stuff," he said.

Unless UK secures half the available business from out-of-state competitive areas over the next 10 years, Karpf said, "It becomes an issue of access for Kentuckians."

He said the out-of-state institutions that are large and advanced enough to effectively compete with UK as a major referral center include Vanderbilt University, Washington University in St. Louis, Indiana University, Ohio State University, Cleveland Clinic, the University of Pittsburgh Medical Center and the University of Virginia. Vanderbilt is the nation's 10th largest academic medical center and gets many patients from Western and Southern Kentucky. 

UK HealthCare map shows out-of-state markets and institutions it targets for its expansion.

What about Louisville, Cincinnati, Knoxville and other cities? Karpf said the University of Louisville, the University of Tennessee, the University of Cincinnati and West Virginia University are too small and too far behind to be Centers of Excellence. U of L's hospital ranks 88th in total discharges among academic medical centers.

All hospitals are facing challenges from federal health-care reform, but Karpf said at UK it has prompted a culture change centered on quality of care, which the reform law is designed to reward. As UK tries to expand its market, he said, it is critical to stay focused on, safety, service and patient satisfaction. One issue Karpf is dealing with now is the hospital's cardiothoracic surgery program for children, which has been suspended pending an internal review.

As UK seeks more referrals, Karpf said, it is building better relationships with smaller hospitals. "in the past, academic medical centers have been seen as predatory," he said. "We concluded that we need to be seen as in another line of business. . . . We have very strong relationships with community hospitals in Western Kentucky."

For example, UK is  training a cardiologist who is dedicated to practicing in Paducah once his training is complete, and kidney specialists from the area are in its transplant network. The specialists evaluate patients, send them to Lexington for transplants, and provide follow-up care upon their return. Such coordination helps community hospitals keep patients and recruit professional staff, and helps UK capture the cases it might lose to Vanderbilt and other out-of-state hospitals.

Baptist Hospitals Inc. has a large facility in Paducah and recently bought the Trover Health System hospital in Madisonville, making Baptist the largest hospital system in Kentucky, but Karpf said UK has a strong relationships with Baptist and the Norton Healthcare hospitals in Louisville. "They do not compete with us for complex care," he said. "We don't go after the bread-and-butter cases."

Complex care, for which insurance companies pay well, accounts for 5 to 7 percent of UK's cases but almost all its profits. Karpf said UK loses money on another 5 to 7 percent and breaks about even on the rest. He said the profits are invested in buildings, technological equipment and attracting nationally recognized specialists.

The most visible evidence of that is the hospital's new bed tower, part of $1.4 billion UK Healthcare has spent revitalizing itself, mostly with its own profits. But the larger impact is probably in expansion of good-paying jobs.

Dr. Michael Karpf

"We've been the most important growth engine in this region," said Karpf. UK HealthCare went from paying $350 million in salaries and benefits in 2004 to more than $700 million last year. The College of Medicine went from 1,810 employees in 2004 to 2,337 in 2012. The hospital grew from 2,562 full time employees in 2004 to 5,544 in 2012, a 116 percent increase.

The medical school's full-time faculty has expanded from 443 a decade ago to 625 now. "We know the stronger you are clinically, the better your research profile," Karpf said. UK Healthcare hopes to achieve National Cancer Institute designation for the Markey Cancer Center, and it must continue to evolve in its clinical, education and research missions, Karpf said.

If UK HealthCare can do that, it will continue to be a major economic driver for Kentucky while ensuring that all Kentuckians have access to quality care.

Kentucky Health News is an independent news service of the Institute for Rural Journalism and Community Issues at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.