The year is coming to a close, but not without one last flurry of healthcare mergers and acquisition news, including two major announcements made Dec. 19.
First on Dec. 19, Philadelphia-based Jefferson and Allentown, Pa.-based Lehigh Valley Health signed a non-binding letter of intent to combine. The systems expect to close the deal in 2024, and the combination would form a system with 30 hospitals, more than 700 sites of care and more than 62,000 employees.
"The healthcare landscape and our communities' needs are changing; it is critical leading systems evolve and make investments in the future of care and wellness — growing and protecting access to enhanced, affordable, high-quality and innovative care, particularly for historically underserved patients," Jefferson CEO Joseph Cacchione, MD, said in a statement.
Later that day, Milwaukee-based Froedtert and Neenah, Wis.-based ThedaCare announced they finalized their merger agreement and will launch as a combined 18-hospital system Jan. 1. ThedaCare President and CEO Imran Andrabi, MD, told Becker's that the merged organization has the rare opportunity to have community health, rural health, urban health and academic health packaged in one system.
On Dec. 20, Rady Children's Hospital-San Diego and Orange, Calif.-based Children's Hospital of Orange County announced that after years of collaboration, they plan to merge and form a single parent entity called Rady Children's Health. The deal is expected to close in 2024, pending regulatory approval. Under the deal, CHOC and Rady Children's will maintain separate medical staff and governing boards and will maintain their respective affiliations with the UC Irvine School of Medicine and UC San Diego School of Medicine.
In New England, Milford (Mass.) Regional Medical Center and Worcester-based UMass Memorial Health said they are aiming to have their new affiliation completed by fall 2024. Also, the state of Rhode Island is reviewing Centurion Foundation's plan to buy CharterCare Health Partners from Los Angeles-based Prospect Medical Holdings. Centurion, an Atlanta-based nonprofit, aims to acquire Providence, R.I.-based CharterCare and its related businesses. The proposed deal would include Roger Williams Medical Center, a 278-bed facility, and Our Lady of Fatima Hospital, a 220-bed facility.
The week also saw a proposed merger scrapped. Walnut Creek, Calif.-based John Muir Health called off plans to acquire San Ramon (Calif.) Regional Medical Center from majority owner Tenet Healthcare, based in Dallas. The news comes one month after the Federal Trade Commission sued to block the deal, arguing that it would drive up healthcare costs in the area by eliminating competition between John Muir and Tenet. The health systems decided not to fight the FTC in court "due to the cost and disruption of litigation," according to a Dec. 18 statement shared with Becker's.
On the payer side, Blue Cross and Blue Shield of Louisiana and Elevance Health submitted a new proposal to the Louisiana Department of Insurance to allow the nonprofit insurer to be bought by Elevance.
Molina Healthcare reduced its offer for Bright Health's California Medicare Advantage business. Molina said it would pay $425 million, net of any tax benefits, for Bright Health's Medicare Advantage business, down from its originally announced purchase price of $510 million. The companies expect the deal to close on or around Jan. 1.
Health Care Service Corp. and Elevance Health are reportedly vying for Cigna's Medicare Advantage business. People with knowledge of the sale told the outlet they expected final bids to be submitted next week. Deliberations on the sale, which could be worth more than $3 billion, are ongoing, and there is no certainty they will end in a deal.