Government

Pa. AG Keeps Jameson, UPMC Merger in Limbo

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NEW CASTLE, Pa. – Sept. 16 will mark one year since Jameson Health System announced its intent to merge with the University of Pittsburgh Medical Center, an agreement that initially was expected to be implemented early this year.

Instead the planned merger is bogged down by competitive questions raised by the office of the Pennsylvania attorney general while Jameson says red ink necessitates next month’s first round of operational cutbacks.

The office of the attorney general reportedly is concerned about price hikes following such a merger and the geographic consolidation of hospital services.

With more than 60,000 employees, UPMC is the largest nongovernmental employer in Pennsylvania . According to a fact sheet posted on the health system’s website, its medical-surgical market share in western Pennsylvania is 41%, and 61% in Allegheny County, where UPMC is based and affiliated with the University of Pittsburgh.

In Lawrence County,  Jameson operates the only hospital health system. In adjacent Mercer County, UPMC operates hospital campuses in Greenville and Farrell, and Jameson operates a community health center in New Wilmington among other facilities.

A page on the Jameson website designated as the Jameson-UPMC Merger Progress Center notes the staff and community rally June 29 that urged the attorney general act quickly to approve the merger. At stake, advocates said, is the survival of local health care.

Today’s edition of the New Castle News reports that Jameson had total operating expenses of $110 million in 2014 compared to net patient revenue of $105 million. “In 2015, the deficit was $3 million and in 2012, it was $1 million,” the newspaper reported, citing numbers from the Pennsylvania Health Care Cost Containment Council.

According to last year’s merger announcement, UPMC plans to “commit to no less than 10 years of planned service improvements for the region” and to spend $70 million on “development of facilities and services” at Jameson, including a minimum of $15 million over the next two years.

But with the merger in limbo, Jameson is reducing operations at its south campus, the former St. Francis Hospital, to a weekday daytime outpatient center from a 24/7 site and eliminating in-patient psychiatric care. The cutbacks will occur next month.

Jameson warns more cutbacks will follow unless and until the merger agreement is approved by the commonwealth.

Contacted last week by The Business Journal, a spokesman for Jameson said, “Our merger progress continues. Both Jameson and UPMC remain 100% committed to the process. We are patiently awaiting the close of the transaction.”

Pictured: Jameson Health Systems new emergency room at its North Campus.

Published by The Business Journal, Youngstown, Ohio.