UPDATE: Aug. 1, 2024: Jefferson Health and Lehigh Valley Health Network said Thursday they have completed their merger, creating a 32-hospital system with more than 700 care sites.
UPDATE: May 16, 2024: Jefferson Health and Lehigh Valley Health Network signed a definitive agreement Wednesday to merge. The health systems expect the deal to close later this summer, pending regulatory approval, according to a press release. Deal terms were not disclosed.
Dive Brief:
- Philadelphia-based Jefferson Health and Allentown, Pennsylvania-based Lehigh Valley Health Network announced on Monday they signed a non-binding letter of intent to combine.
- If approved, the merger would join Jefferson’s hospital system with Lehigh’s 13 facilities to form a 30-hospital system with more than 62,000 employees.
- Jefferson Health’s chief executive, Joseph Cacchione, will remain at the helm of the new enterprise, according to the release.
Dive Insight:
The proposed merger between Jefferson and Lehigh Valley is expected to close in 2024 pending regulatory approval. Post-merger, Lehigh Valley’s chief executive Brian Nester will report directly to Cacchione as the new system’s executive vice president and chief operating officer and president of the legacy Lehigh Valley network, according to the release.
The announcement comes after both health systems have restructured and downsized.
Earlier this year, Jefferson announced a reorganization plan, collapsing five divisions into three in a bid for increased operational efficiency, according to reporting from the Philadelphia Inquirer.
Lehigh Valley eliminated approximately 240 positions this fall during an organization-wide restructuring, Lehigh Valley News reported.
Jefferson Health generated an operating loss of $78.5 million on $9.7 billion of revenue for the fiscal year ended June 30. Lehigh Valley was in the black for fiscal year 2023, reporting $10.4 million operating income in fiscal 2023.
Hospital merger and acquisition activity has trended back to pre-pandemic levels after dipping in 2021 and 2022 according to a recent report from consultancy Kaufman Hall.
