Doylestown (Pa.) Health is meeting certain financial goals that will clear the way for a definitive agreement to merge with the University of Pennsylvania Health System, according to the Philadelphia Business Journal.
The two systems signed a nonbinding letter of intent in January to explore if Doylestown will become part of Penn Medicine, a six-hospital system.
The proposed deal would lay the foundation for the development of new clinical programs and expanded services across the greater Philadelphia region. It would also build upon existing clinical integration in cancer care between the two systems.
Doylestown must hit certain financial targets laid out by the two health systems for the proposed merger to move forward.
"We needed to continue to show improvement," Doylestown President and CEO James Brexler told the Journal. "What was asked of us was to hit our budget and demonstrate that we are, in fact, improving. The first of those hurdles was at the end of March, and the second was at the end of June, the end of our fiscal year."
For the first three quarters of its fiscal year 2023, which ends June 30, Doylestown posted a $7.6 million net loss, down from a net loss of $18.1 million for the same nine-month period the previous year, according to the report. The system posted a net loss of $15,2 million for the fiscal year ending June 30, 2023, and aims to trim its overall loss to $6.7 million in fiscal 2024 — something Mr. Baxter said Doylestown is on track to do.
"We're not a place that generates huge margins, we've never done that," Mr. Baxter told the Journal. "Our mission isn't independence, it is taking care of this community."
Both systems are expected to sign a definitive agreement to merge in mid-August. The deal would then need approval from state and federal regulators before it can be finalized.