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Independent Children's Hospital Announcement

Thursday, May 21, 2015

To the VCU and VCU Health System Community,

Today executive leadership from the VCU and Bon Secours health systems announced that we are withdrawing from negotiations for an independent children’s hospital in Richmond.  More importantly, we will refocus our efforts to advance children’s health through greater collaboration on initiatives that improve access and coordination of care to all children.

The decision was difficult and comes after years of careful and thorough analysis and public input. We have determined that the proposed free-standing independent children’s hospital model is not a viable approach for VCU and its academic medical center. Bon Secours has reached the same conclusion for its system of hospitals.

VCU’s participation was contingent on the ability to advance children’s health care while enhancing our clinical, education, research and safety net missions, as well as fulfilling our fiduciary responsibilities.  Our conclusion was that this would not be possible due to a number of contributing factors, including increasing instability in the health care industry, the impact of transferring our entire pediatrics clinical and training programs to a new entity, and changes in best practice health care models.

Specifically, cuts to hospitals under federal and other programs, coupled with labor costs increase and cost savings required by commercial payers, have placed significant pressures on our health systems as we continue to care for the underserved in our community. Today’s emerging health care models are very much focused on outpatient care (more than 90 percent of pediatric care is provided in the outpatient setting), coordinated care, and distributed care networks enabled by technology tools. It is important to note that demand in Virginia for inpatient pediatric beds has continued to decline over the past five years.

For all of these reasons, it makes sense to focus on collaboration. We learned a great deal in our exploration of an independent children’s hospital and want to thank community philanthropists, particularly Bill and Alice Goodwin, and the pediatricians and pediatric specialists – especially our VCU pediatric health care team – for shining a spotlight on children’s health and motivating us to emphasize access and coordination of care for all children.

We will continue to commit significant resources to build on our existing clinical, teaching and research foundations, and explore more opportunities to create integrated networks based on our collective strengths. Over the last several years we have significantly invested in recruiting and retaining the most talented children’s experts and researchers to establish world-class pediatric programs and advance children’s health care in the Richmond region and beyond. We look forward to the opening of the Children’s Hospital of Richmond at VCU’s Children’s Pavilion next year and the new Virginia Treatment Center for Children in 2017. We also know that our pediatric patients and fellow team members who care for them need to be in contemporary spaces designed just for them, and we will aggressively pursue those options for our children’s services.

Sincerely,

Michael Rao, President, VCU and the VCU Health System

Jerome Strauss, Interim CEO, VCU Health System and Interim Vice President for Health Sciences and Dean, VCU School of Medicine

John Duval, CEO, VCU Hospitals

John Ward, President, MCV Physicians