Lewisburg, Pa.-based Evangelical Community Hospital has been an independent community hospital for close to 100 years, but CEO Kendra Aucker said that with an aging population and growing costs, the model is no longer sustainable, PennLive.com reported Feb. 26.
Evangelical Community Hospital signed a definitive agreement to join York, Pa.-based WellSpan Health. Pending regulatory approval, the hospital is expecting to join the system in July.
Ms. Aucker said the decision to find a partner was proactive and made before the hospital's financial situation was at a tipping point, according to the report. The hospital lost $19 million in 2023 after offsets and $2.5 million in 2022. Increased labor and supply costs, as well as inadequate reimbursement for Medicare and Medicaid patients, drove those losses.
The Evangelical CEO said joining WellSpan will allow for better clinical services in its service area where the population is aging and deaths outnumber births, according to the report. It will also offer greater access to technology and healthcare delivery innovations, educational resources and expanded community health benefit programs as well as bolster the hospital's financial vitality and sustainability.
WellSpan is planning to invest more than $100 million in Evangelical over the next three years, which will be used to improve technology, renovate facilities and potentially expand clinical services, according to the report.
In 2019, Evangelical attempted to partner with Geisinger Medical Center in nearby Danville, Pa., but the federal government sued to prevent Geisinger from acquiring a 30% stake in the hospital, according to the report. The government alleged the deal violated the Sherman and Clayton Antitrust acts. A 2021 settlement capped Geisiginer's interest in the hospital at 7.5%. If the WellSpan deal is approved, the York-based system will pay Geisinger $20.3 million for that investment.