Jefferson Health System, based in Radnor, Pa., has decided to restructure, which will result in its three main entities splitting and managing their own finances.
Jefferson Health System includes Thomas Jefferson University Hospitals, its flagship based in Philadelphia, Main Line Health, a four-hospital system based in Bryn Mawr, Pa., and Magee Rehabilitation Hospital in Philadelphia. Under terms of the restructuring, each of those systems will manage their own strategic decision-making and financial oversight, essentially dissolving the Jefferson Health System name.
Executives said no layoffs will result from the maneuver. The small amount of employees who work within Jefferson Health System will be offered positions within TJUH or Main Line Health, or they will receive severance packages. In addition, the academic and clinical affiliations between TJUH and Main Line Health hospitals will still stand.
The restructuring needs regulatory approval, and the definitive agreements to split the corporation are expected to close by July 1.
In Jefferson Health System's 2013 fiscal year, which ended June 30, the system posted $3.05 billion in revenue, $238.9 million in operating income and $304.3 million of total profit — all of which increased compared with FY 2012. Specific reasons for the restructuring were not given, other than to give "autonomy and agility" to its member systems.
"Today's healthcare environment requires that we reimagine the way healthcare is delivered," Stephen Klasko, MD, president and CEO of Thomas Jefferson University and TJUH System, said in a news release. "We collectively realized that the existing corporate structure needs to be changed to allow us to be more entrepreneurial, nimble and responsive. Jefferson looks forward to an increasingly vibrant clinical and academic relationship with Main Line Health."
Jefferson Health System was created in 1995 to manage the business and administrative functions, such as financial reporting and payer contracting, of the three systems. The organization had created several accountable care deals with payers across the state, including one with Keystone First and another with Independence Blue Cross. TJUH and Main Line Health will still jointly operate their insurance programs and accountable care organizations.
More Articles on Health System Structures:
Solid Communications Roadmap Can Lead To Successful Merger
Dr. Ezekiel Emanuel: "We Don't Need 5,000 Hospitals"
Tenet, Yale New Haven Form Regional Partnership