More on Strategic Planning

Geisinger, St. Luke's announce plans for first joint venture hospital in Pennsylvania

Two healthcare systems have agreed to build and equally co-own a new hospital.

Beth Jones Sanborn, Managing Editor

A rendering of the proposed hospital. Credit: Geisinger A rendering of the proposed hospital. Credit: Geisinger

In a first of it's kind venture for Pennsylvania, Geisinger and St. Luke's University Health Network are partnering on a joint venture that will yield a new 80-bed acute care hospital equipped with an emergency department and a full range of specialties and hospital services, Geisinger announced.

The new hospital deal could serve as a blueprint for other regional systems who have mutual relationships in certain areas and who both want to expand their respective footprints. Joint ventures like this mean the two systems can work together and mutually benefit from an arrangement that is not nearly as complicated or riddled with cost and logistical challenges as a merger. 

The three story, 120,000 square-foot hospital will operate with funding and governance shared equally between the two nonprofit systems. 

"We know that many patients are leaving Schuylkill and Berks counties for hospital services," Geisinger CEO David Feinberg, MD said. "Our partnership with St. Luke's will expand the range of healthcare services in that community but perhaps, more importantly, will offer convenience so that patients, including many of our Geisinger Health Plan members, will receive the care they need right where they live."

Geisinger and St. Luke's have a history of collaboration, with current partnerships including insurance and as of July 1, Geisinger will provide life flight service for the St. Luke's system as well. 

St. Luke's network includes 14,000 employees that staff 10 hospitals and over 300 outpatient sites and an annual net revenue of $1.9 billion. Geisinger's system includes approximately 32,000 employees, including nearly 1,800 employed physicians, 13 hospital campuses, two research centers, and a 580,000-member health plan serving more than 3 million residents throughout central, south-central and northeast Pennsylvania, and in southern New Jersey at AtlantiCare.

For other healthcare systems watching this arrangement, this type of deal could forecast how well two systems i can integrate and work together, and whether their missions, ideals and protocols will be compatible enough to succeed.

The joint venture build will break ground this spring and is slated to to open in late 2019.

Twitter: @BethJSanborn
Email the writer: