AFTER P. 24. SPECIAL FEATURE:
Industry changes foster more M&A activity
DOWNLOAD The mergers and acquisition chart at modernhealthcare.com/mergersdata
Bayhealth Medical Center completed a $47 million expansion of its Kent General Hospital campus. The project, which began in August 2008, added a 375-space parking garage and treatment bays to the hospital’s emergency room, a spokesman said in an e-mail. The project consolidated cancer care into two stories that include three radiation therapy vaults. Also included in the project are a 7,000-square-foot pharmacy, 30,000-square-foot central service building and 3,500-square-foot security department. YORK, Pa.—
Community Health Systems said it reached a definitive agreement to acquire Memorial Hospital, which would be the hospital chain’s 17th hospital in Pennsylvania. Community said in a news release that the agreement calls for the Franklin, Tenn.-based company to build a replacement hospital within five years of the closing date, which is subject to regulatory approvals that include a review by the Pennsylvania attorney general. Financial terms were not disclosed. Community would purchase substantially all of the assets of the 100-bed hospital and its parent, Memorial Health Systems, which also includes an ambulatory surgery center and other outpatient services. “After evaluating potential partners, we selected Community Health Systems to help us maintain choice and transform healthcare in our community,” Memorial President and CEO Sally Dixon said in a news release. On Jan. 1, Community closed a deal adding two-hospital Moses Taylor Health Care System, Scranton, Pa., to its holdings. “As we continue to expand our operations across Pennsylvania, we are excited about the prospect of applying our capital and management resources to help serve this growing community,” Wayne Smith, Community’s chairman, president and CEO, said in its release announcing the York agreement. Hospital care in York is dominated by Wellspan Health’s 560-bed York Hospital. BOSTON—
Gov. Deval Patrick is calling on lawmakers to pass a sweeping overhaul of the healthcare payment system in Massachusetts. In his state of the state address Monday, Patrick said Massachusetts has to end the “fee-forservice” model that rewards doctors and hospitals for the amount of care they deliver instead of the quality. Patrick said the system needs to be changed to reward doctors and other healthcare providers for coordinating patient care and focusing on keeping patients healthy instead of treating each illness. Patrick said the state also needs to overhaul its medical malpractice laws. State lawmakers have already said that healthcare cost containment is a top issue for the new year. They say bringing costs under control is critical to maintaining the state’s landmark 2006 healthcare law. RIDGEWOOD, N.J.—
Valley Hospital announced it formed an accountable care organization. The 446-bed hospital said its ACO jointly applied with Atlantic Health System, Morristown, N.J., to become a Medicare ACO starting in April. Applications for the Medicare program, which offers financial incentives for healthcare quality and cost control, were due Jan. 20. Atlantic Health, which includes Morristown Medical Center and Overlook Medical Center in Summit, said the combined ACO would include 1,200 doctors and operate across five New Jersey counties. The CMS will name its first group of Medicare ACOS by March 16. Medicare will contract with a second group of accountable care organizations starting July 1, but the CMS does not begin accepting applications for the second wave until March 1. Ellen Griffith, a spokeswoman for the CMS, declined to say how many organizations applied to become Medicare accountable care organizations as of April 1. “All I can tell you is that we are very pleased with the number of applications we received,” Griffith said in an e-mail.
Patrick said Massachusetts has to end the fee-for-service model.