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Penn State Health aligns with Highmark on new $1 billion care network in central Pennsylvania

Pennsylvania systems joins forces to ramp up analytics, population health and community care.

Beth Jones Sanborn, Managing Editor

Credit: Penn State.

Major Pennsylvania systems Penn State Health and Highmark Health have announced plans for a strategic partnership that centers on a collective investment of more than $1 billion toward the development of "a high-value, community-based health care network designed to keep care local and enhance collaboration with community physicians."

The community network will be anchored by the Penn State system's flagship facility Milton S. Hershey Medical Center, a prominent teaching and research hospital in the region.

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The new partnership is focused on improving access and quality across south central Pennsylvania, the systems said in a statement, and boosting both medical education and research.

Though the systems said it would be premature to speculate on whether they would in fact build new facilities, or how many could added, they are not counting out the possibility of new construction in establishing the planned community care network in central and southcentral Pennsylvania, a key focus of the partnership.

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Another key focus, the system said, will be reinforcing Milton S. Hershey Medical Center and Penn State Children's Hospital as the premier destinations for advanced care in the region for adults and children. A Penn State Health spokesperson said the Medical Center will be the hub of the community network, and they will be "exploring ways to connect healthcare and coverage through new insurance products aimed at simplifying access to care and addressing costs."

The two systems will work on developing advanced population health management capabilities, analytics and care models to help manage chronic illnesses enhance community wellness, Penn State Health said.

New co-branded health care insurance products could also emerge.

"Through both health insurance product designs and access to community-based care, we believe that we will be able to better serve patients with chronic illness under the banner of right care, right location at right cost," Penn State Health said. "Our objective will be to keep care in the community where patients can best served for routine care."

More funding for Penn State College of Medicine medical and health sciences education and advanced research will also be pursued.

Under the terms, Penn State Health remains free to contract with other health care insurance companies and its existing health insurance agreements will remain in place. Likewise, Highmark Health's payer arm, Highmark Inc., will be free to contract with other hospitals and health systems, and its existing agreements with other healthcare providers will not change.

Highmark Health joins Penn State Health as a member with a minority interest, and will occupy up to three seats on the 15-member Board of Directors. Both organizations' boards approved the partnership this week.

Twitter: @BethJSanborn
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