Nixed Hershey-PinnacleHealth marriage could send them into arms of someone else


http://www.pennlive.com/news/2016/11/nixed_hershey-pinnaclehealth_m.html

PinnacleHealth System and Penn State Milton S. Hershey Medical Center said a marriage made sense for many reasons.

Not the least of which was to gain size and strength needed to fend off megasystems from outside their traditional service area. Those systems, they said, are positioning to siphon away patients needing the most advanced care, thereby eroding revenues needed to support those services in Harrisburg-area counties.

But the Federal Trade Commission opposed the merger on the grounds it would create a local hospital monopoly, and Hershey and Pinnacle subsequently called off their engagement.

 Still, experts say the forces that pulled the one-time rivals together are real and won’t go away. Those forces have triggered a wave of health system consolidation all over the country. In the Harrisburg region, they have prompted players such as Geisinger Health System, WellSpan Health and the newly-merged Lancaster General Health-University of Pennsylvania Health System to eye the territory traditionally served by Pinnacle and Hershey.

Those systems now surround Pinnacle and Hershey. At the same time, health care has entered an era where health systems are forever trying to attract more patients. That often requires expanding their footprint.

“It’s going to be hard for them to maintain what they’re doing as stand-alones,” said David Sarcone, an associate professor of business management and health studies at Dickinson College.

Stephen Foreman, an associate professor of health care administration at Robert Morris University in Pittsburgh said, “I can’t say I think their positions are all that great right now.”

 

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