After months of antitrust investigations, Penn State Health and Montour County-based Geisinger have agreed to move forward on a deal for the Hershey-based health system to acquire Holy Spirit Health System without approval from state and federal authorities.
Penn State Health announced last October that it signed a letter of intent with Geisinger to take ownership of the Cumberland County health system and its 306-bed hospital and 28 outpatient locations across four counties.
The acquisition was originally expected to be completed by June 30, but the sale date was extended after the Federal Trade Commission and the Pennsylvania Attorney General’s office asked to extend their investigations.
Neither the Federal Trade Commission nor the Pennsylvania Attorney General’s office have yet to approve the acquisition.
The two hospital systems agreed to move forward with the deal regardless of approval from either entity.
“The Federal Trade Commission and Attorney General began investigating the transaction shortly after it was publicly announced over a year ago,” said a Penn State Health spokesperson. “At this point, neither regulator has sought to preclude the parties from closing the transaction.”
The Federal Trade Commission and the Pennsylvania Attorney General’s office both declined to comment.
Holy Spirit Health System was acquired by Geisinger in 2014 and acted as a point of entry for the north central Pennsylvania hospital system to operate in the midstate.
Dr. Jaewon Ryu, president and CEO of Geisinger, said his team is confident that Penn State Health will continue the system’s tradition of faith-based care, something that it also did in its acquisition of the Berks County-based St. Joseph Medical Center in 2015.
“We firmly believe that this is the best path forward for all parties and most importantly for the communities within the Greater Harrisburg region that are served by the Holy Spirit team,” Ryu said.
There are currently no plans to disclose the financial terms of the deal, according to a spokesperson for Penn State Health.
The acquisition is part of Penn State Health’s 0, 10, 20, 30 strategy. The system aims to have patients be zero minutes from telehealth services, 10 minutes from a primary care provider, 20 minutes from a specialty care provider and 30 minutes from a Penn State Health hospital.
The East Pennsboro Township is set to act as a complement to Penn State Health’s incoming 108-bed Hampden Medical Center which is expected to be finished next summer.
“The transition of Holy Spirit into Penn State Health brings together two well-known and respected Central Pennsylvania health care organizations for the benefit of our region,” Steve Massini, CEO of Penn State Health, said in a statement. “It strengthens health care choices, preserves continuity of care for Holy Spirit patients and retains the system’s talented and experienced health care workforce.”
More than 2,400 Geisinger employees will be joining Penn State Health as part of the deal.
In a previous interview with the Central Penn Business Journal, Massini said that the deal with Geisinger allows Penn State Health to grow its practice sites and clinics in the region without building new facilities.
Massini said he was perplexed at the challenges the deal had in getting through the antitrust investigations.
“When you see how this fits in the community, what it does for competition and for jobs, I just don’t understand why this has taken so long and been such a challenge,” he said.
Update: The story was changed to highlight that Penn State Health and Geisinger have not yet received approval Through the Federal Trade Commission and Pennsylvania Attorney General’s office.