LITTLE ROCK — A legislative panel Monday endorsed a $720,000 contract that allows the University of Arkansas for Medical Sciences to explore a possible partnership with St. Vincent Health System.

The contract was before Legislative Council earlier this month but it was referred back to its Review Subcommittee after some lawmakers said they had received phone calls from people concerned about how a partnership between the state-run hospital and the Catholic hospital would handle women’s issues, including reproductive health.

UAMS Chancellor Dan Rahn assured lawmakers Monday that any relationship between the two hospitals would not affect UAMS’ mission as a public hospital.

"We’re not considering a merger with St. Vincent," Rahn said, adding that "UAMS is not exploring the possibility of being taken over by another entity, or any component of our mission.

"Any strategic alliance of affiliation that we would ultimately engage in will not include women’s services, reproductive services or contraceptive services. We have said that from day one. None of those services are on the table."

The study is needed so UAMS can see if there is any way to save money through a relationship with St. Vincent, Rahn said. Costs at UAMS continue to rise and a recent audit found that the hospital spent $203 million last year on medical care for people without insurance, or who didn’t pay their bills.

"Our motivation for considering this, I think, we all know," he said. "We’re not going to be able to do things the same way that we have in the past with regard to health care and accomplish the vision that we all have for better health and lower health costs in society, whether we’re looking at that from the federal level or the state level."

He also said any final decision on an affiliation between the two hospitals would have to be approved by the UA Board of Trustees, the governor, the attorney general and the Legislature.

The contract with Deloitte Consulting would allow the firm to evaluate the hospital and determine if any affiliation with St. Vincent Health would be feasible.Rahn said Deloitte is entering into a similar contract with St. Vincent to do the same study.

Jo Ann Coleman of Little Rock told the committee that she was concerned that UAMS wants to enter into a contract with Deloitte Consulting without taking bids, and she questioned whether the firm could be impartial in studying both hospitals.

Sen. Jeremy Hutchinson, R-Little Rock, suggested studying both facility might be a conflict for the firm. Rahn said the two hospitals are in complete agreement on the study and what it entails.

"We are independently and separately in agreement that we would like to explore the potential value of a strategic alliance that is in line with the letter of intent that we have signed and made public," he said. "We’re not in conflict with St. Vincent Health System with regard to our desire to explore the potential value of an alliance with them."