Lafayette General and Ochsner Health merge in deal worth nearly half a billion

por John R. Fischer, Senior Reporter | October 05, 2020
Business Affairs
Lafayette General Medical Center
Lafayette General Health has merged with Ochsner Health in a deal that includes an investment of nearly half a billion dollars from the latter over the next 10 years.

The deal will allow Lafayette, which will be known as Ochsner Lafayette General, to provide greater healthcare access to communities across the Acadiana (French) region of Louisiana. The agreement makes Ochsner the largest healthcare provider in the Gulf South.

“Our vision is to truly improve the health of Louisianans and people across the Gulf South, and this allows us to expand the Ochsner reach into an important region in Louisiana,” Warner Thomas, president and CEO of Ochsner Health, told HCB News. “Lafayette General Health is the healthcare leader in Acadiana, and now as one system we have the opportunity to address the health challenges of our state, improve the health status of the people we take care of and make Louisiana a better place for healthcare.”

A merger between the two organizations has been in the works since September 2019, when the Lafayette General Health Board of Trustees signed a letter of intent to bring the two together and build on their existing clinical affiliation. The Louisiana Attorney General approved the deal this September.

Ochsner will invest $465 million in capital and resources to expand care across Acadiana, including $94 million at Ochsner Lafayette General Medical Center. This portion will be used to construct a new tower with six inpatient floors and a new parking garage, as well as add 34 outpatient infusion chairs at the Cancer Center of Acadiana to enable more cancer patients to receive care close to home.

It also plans to construct a state-of-the-art Center of Excellence building to expand cancer services and neurosciences, and invest $1 million in the Healthcare Innovation Fund at the Ochsner Lafayette General Foundation to further digital medicine and technology initiatives in Acadiana.

Other innovations include immediate facility upgrades and greater financial stability for Ochsner University Hospital & Clinics; a $10 million, 10-year community support fund to advance health and wellness across Acadiana; investment in graduate medical education and new residency positions at Ochsner LGMC; and approximately $21 million over 10 years to increase the minimum wage from $10 to $12 per hour, effective immediately, for 900 employees. Employees will also be eligible for an annual 2% retirement contribution on top of their current 401(k) match, which represents a $4 million annual investment in the long-term financial stability of Ochsner Lafayette General employees.

“Ochsner Lafayette General will advance digital innovation and patient-centered solutions through collaboration with innovationOchsner (iO) and further investments in digital health tools that help patients get the care they need wherever they are," said Thomas. "We will be bringing our iO programs including AI, machine learning and enhanced data analytics to the Acadiana region as well as our digital medicine programs to help patients manage chronic conditions such as hypertension and diabetes.”

Ochsner Lafayette General will anchor its services in the region for the statewide health system, which includes updated names and branding to be rolled out at Lafayette’s regional hospitals and clinics. They include Ochsner Lafayette General Medical Center; Ochsner Acadia General Hospital – American Legion Post 15; Ochsner Abrom Kaplan Memorial Hospital; Ochsner Lafayette General Orthopaedic Hospital – a Lafayette General Medical Center Campus; Ochsner Lafayette General Surgical Hospital – A Lafayette General Medical Center Campus; Ochsner St. Martin Hospital; and Ochsner University Hospital & Clinics.

EDIT: A previous version of this article's headline incorrectly stated the deal was worth $1 billion. The headline has been corrected.

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