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PinnacleHealth, Hershey Medical to form 'collaborative and innovative health enterprise'

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Penn State Milton S. Hershey Medical Center and PinnacleHealth System have signed a letter of intent to form a new health enterprise. Pictured, standing, from left, are Clarence Asbury, vice chairman of PinnacleHealth System board of directors; Phil Guarneschelli, senior vice president and chief operating officer, PinnacleHealth System; George F. Grode, chairman of PinnacleHealth System board of directors; Keith E. Masser, chairman of the Penn State board of trustees; Robin D. Wittenstein, FACHE, chief operating officer, Penn State Hershey Health System; Dennis P. Brenckle, vice chairman, Penn State Hershey board of directors. Seated, from left, are Michael A. Young, FACHE, president and CEO of PinnacleHealth System; Harold L. Paz, M.D., M.S., CEO of Penn State Hershey Medical Center and Health System, Penn State's senior vice president for health affairs, and dean, Penn State College of Medicine.
Penn State Milton S. Hershey Medical Center and PinnacleHealth System have signed a letter of intent to form a new health enterprise. Pictured, standing, from left, are Clarence Asbury, vice chairman of PinnacleHealth System board of directors; Phil Guarneschelli, senior vice president and chief operating officer, PinnacleHealth System; George F. Grode, chairman of PinnacleHealth System board of directors; Keith E. Masser, chairman of the Penn State board of trustees; Robin D. Wittenstein, FACHE, chief operating officer, Penn State Hershey Health System; Dennis P. Brenckle, vice chairman, Penn State Hershey board of directors. Seated, from left, are Michael A. Young, FACHE, president and CEO of PinnacleHealth System; Harold L. Paz, M.D., M.S., CEO of Penn State Hershey Medical Center and Health System, Penn State's senior vice president for health affairs, and dean, Penn State College of Medicine. - (Photo / Submitted)

Penn State Milton S. Hershey Medical Center and PinnacleHealth System have signed a letter of intent to form a new health enterprise in Central Pennsylvania, the organizations announced this afternoon.

"This new health enterprise would be governed by a new board with equal representation from both organizations. Under the proposed structure, Harold L. Paz, M.D., M.S., chief executive officer of Penn State Hershey Medical Center and Health System and Penn State’s senior vice president for health affairs will oversee the Health Enterprise as the CEO. Michael Young, President and CEO of PinnacleHealth System, will oversee the operations of the enterprise as President," a news release said.

"This new collaborative and innovative enterprise will bring together a high-performing university medical center and a community health system known for its quality outcomes and patient-focused care. It will provide increased access to a wider range of services and full spectrum of care to patients over a broader geographic base," the release stated.

“In response to rapidly-evolving market conditions driven by healthcare reform, and with a continued focus on cost effective, high-quality care delivery and accessibility, PinnacleHealth System and Penn State Hershey see the formation of a combined health system as the way forward in maintaining a relentless focus on innovation, a commitment to quality patient care, and the discovery of new and better ways to prevent, diagnose and treat disease,” Paz said.

“Working together we will continue to improve the health of our communities and find new opportunities to deliver more comprehensive, high quality, cost effective and accessible healthcare services to the greater region,” Young said. “Through our complementary strengths, Penn State Hershey and PinnacleHealth will be well-positioned to meet the growing and diverse healthcare needs of the people of central Pennsylvania.”

The health systems said they will both continue to operate independently and as normal until the integration is finalized and all necessary approvals are obtained.

The two announced in November they had entered formal discussions to broaden their existing strategic relationship, and then in January they had hired a relationship adviser.

News that they are proceeding with the deal comes just days after Holy Spirit Health System’s announcement Monday that, assuming regulatory approval, it will become an affiliate of Danville-based Geisinger Health System. Geisinger and Hershey Medical Center had a short-lived and unsuccessful merger in the late 1990s.

In an interview with the Business Journal, Paz said Hershey carefully considered the past and what worked and what didn’t work.

“There were a lot of great lessons that we learned from looking at that experience,” Paz said of the Geisinger episode. He described the proposed governance model as durable and well-suited to not only addressing evolving health care models but also training the next generation of medical providers and performing cutting-edge research, particularly as it relates to the associated medical school. And, he said, his leadership team’s response to the model has been gratifying.

“We’ve looked at a number of different partners and models,” Paz said. “We were looking for a partner that has a shared vision for teaching and for research.”

Young described the proposed relationship as “a combination versus a merger, but you end up at the same place.” Asked what would change, he said patients should expect continued easy access across the whole spectrum of care that both organizations currently offer. However, he said , the coordination they will achieve by combining forces will allow the elimination of redundancies, such as duplicative testing, while preserving the close, convenient access patients now have to their respective services.

“We’ll be the leading health care organization in Central Pa.,” Young said. “While the rest of the world is going through a huge health care change, we’ll be ahead of the curve.”

The regulatory approval process will probably take about a year, Young said. Asked if the organizations expect any problems with it given their proximity, he said, “We think the arguments are pretty compelling, the community benefit points; we’re pretty positive that this is going to get done.”

“At the end of the day it’s about creating value for our patients,” Paz said.

Heather Stauffer

Heather Stauffer

Heather Stauffer covers Lancaster County, nonprofits, education and health care. Have a tip or question for her? Email her at heathers@cpbj.com. Follow her on Twitter, @StaufferCPBJ.

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Comments


BobW said:
Interesting comments. SueH clearly does not know that many of the HMC residents have ended up in practice at Pinnacle over the years. Both institutions have their strengths and supporters.

June 30, 2014 9:19 am

AnnP said:
I disagree with Sue H completely. My father was a patient at Hershey Medical in their Cancer Unit and the Doctors, Nurses and staff - well they were a part of our family. When my Dad could no longer fight the cancer - they cried with us. They loved their patient and you can't ask for better care than that. As far as Harrisburg. Fantastic Cardiac Care. I believe there is potential for poor care at both facilities. But - you can get that at any restaurant you go to as well. Overall - both are fantastic facilities and we are lucky to have them in our region.

June 27, 2014 9:36 am

SueH said:
I wouldn't take anyone I cared about to HMC, unless it was to the Children's Hospital. For my money, Pinnacle has better prices and better treatment from a health care team. Once the residents and interns graduate from the medical program, I would not go to them for health care, either. There is a certain way of doing things at HMC and the doctors act as if they have graduated from a world class facility. some of them need to be taken down a peg or two.

June 26, 2014 7:55 pm



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