Fulton-DeKalb Hospital Authority and Grady Memorial Hospital Corporation Sign Lease and Transfer Agreement for Grady Health System
Lease Commencement Date Targeted for May 1

The Fulton DeKalb Hospital Authority (FDHA) and the Grady Memorial Hospital Corporation (GMHC) today signed the lease and transfer agreement that will lead to the GMHC assuming responsibility for the operations of the health system, targeted for May 1.

"We have taken another major step today toward securing the mission and the future of Grady Health System," said FDHA chair Pamela Stephenson. "While much work remains in this transition process, much has been accomplished that will benefit our patients, our employees and the community we serve."

Before signing the funding agreement, the following items were received:

• The Robert W. Woodruff Foundation submitted a letter to the FDHA pledging $200 million to Grady over four years for capital needs. The first installment of $50 million is due when the lease commences, targeted for May 1. (letter)
• The GMHC submitted a letter to the FDHA pledging its best efforts to raise another $100 million over four years. (letter)
• The Emory School of Medicine and the Morehouse School of Medicine submitted letters agreeing to renegotiate their contract and outstanding debt obligations with Grady. (letter)
• Assurances of state support. (letter/open item)

Stephenson said today's lease signing is another milestone in a nearly two-year campaign launched by the FDHA board of trustees to secure community, regional and state support for the financially struggling health system. It was that campaign that ultimately led to the creation of the new nonprofit GMHC.

A. D. "Pete" Correll, chairman of the Grady Memorial Hospital Corporation and former chairman of Georgia-Pacific, said the new board has a very specific focus.

"We exist to preserve Grady's historic mission as a safety-net hospital for this region and to raise the money it takes to do that," he said. "This board will not try to run the day-to-day work of the hospital. Instead, our job is to ensure good governance and transparency, support a top-quality management team so they can successfully run the day-to-day operations of the hospital, and raise the money Grady needs to keep serving this community."

When the lease begins, employees will transfer to the GMHC with their current jobs and salaries, and the GMHC will be responsible for the operations of the health system.

Stephenson said both boards are working to address all transition issues – including employee benefits and pension, regulatory filings, and Medicare and Medicaid issues - so that there is a smooth transition.

"A top priority for both boards is to ensure that Grady is legally and financially sound, and able to continue providing quality health care to the patients it serves," she said. "We want this transition to be very smooth for our patients, our employees, and the whole community."

Attached is a Questions & Answers document.