Penn State Health Completes Acquisition of St. Joseph Regional Health Network
July 31, 2015
Penn State Health (“PSH”) and Catholic Health Initiatives (“CHI”) have completed the transfer of ownership of CHI’s affiliate, St. Joseph Regional Health Network (“St. Joseph”) in Reading, PA, to PSH. PSH’s decision to assume ownership of St. Joseph is a recognition that the healthcare industry is rapidly changing and moving to a new model – one in which organizations are expected to offer integrated systems of care for specific geographical populations. As a result, many health systems are growing, in order to expand their care delivery capabilities within existing regions.
This acquisition builds on an existing five-year relationship and will enable PSH and St. Joseph to more comprehensively coordinate the care of patients in the Berks region, enhance access to services, manage the cost of care and improve population health. It will provide increased and coordinated access to specialty care services and advanced therapies for patients, including clinical trials.
PSH was developed in 2014 to enable Penn State University to bring the Milton S. Hershey Medical Center and its various healthcare services, as well as the Penn State Hershey Health System and its associated entities, together with other healthcare facilities. The 551-bed Medical Center is a leading university health center and provider of high-level, patient-focused medical care. The Medical Center campus includes Penn State College of Medicine (Penn State University’s medical school), Penn State Hershey Cancer Institute and Penn State Hershey Children’s Hospital. Penn State Hershey Health System includes the Pennsylvania Psychiatric Institute, Penn State Hershey Rehabilitation Hospital, and other specialty facilities.
PSH retained Cain Brothers to assist in evaluating and structuring a transaction that would best position the combined entity to provide the communities served by PSH with continued comprehensive, high quality and cost-effective care in current and future healthcare environments. Cain Brothers advised PSH throughout a negotiation process that resulted in financial and structural terms that position PSH to best serve the region’s residents.