U. Health System will merge with country's oldest hospital

The University of Pennsylvania Health System took another step forward yesterday in its efforts at continued expansion. But for its latest affiliation, UPHS looked to the past, agreeing to merge with Pennsylvania Hospital, -- the country's oldest hospital, which was founded by Benjamin Franklin in 1751. This is the second corporate affiliation UPHS has agreed to in the last two weeks. On October 30, UPHS and Phoenixville Hospital signed a letter of intent announcing their plans to merge by March. UPHS will now work on final agreements to transfer ownership of Pennsylvania Hospital, located at 8th and Spruce streets. The parties plan to finalize these details within the next few months. "This is a momentous decision for Pennsylvania Hospital, because we have been a freestanding hospital for nearly 250 years," said John Ball, president and chief executive officer of Pennsylvania Hospital. "In light of changes in the health care environment in Philadelphia, an affiliation with a leading academic health system will enhance Pennsylvania Hospital's strengths," Ball said, adding that UPHS will help his institution build a stronger base of primary care referrals to its specialty services. The merger, Ball added, will also increase Pennsylvania Hospital's negotiating power. Penn Medical Center spokesperson Lori Doyle said the merger helps the Penn Health System, because Pennsylvania Hospital will bring in many patients from South Philadelphia and Southern New Jersey. She added that before 1993, the two institutions were academically affiliated, a relationship "that will now be restored." "One of the major advantages is the teaching opportunity for our medical students to train there," Doyle added. But Doyle noted that the details of the new academic affiliation still need to be resolved. Pennsylvania Hospital spokesperson Patricia Usner explained that the affiliation will begin with a two-year transition period. During this time, UPHS members will join Pennsylvania Hospital's governing board, although the current members will retain control. After two years, UPHS board members will make up the majority and thus have authority over the hospital's management decisions. Usner added that over the next years, the two institutions will also determine which services to consolidate. In choosing UPHS, Pennsylvania Hospital turned down a similar offer from Philadelphia's Jefferson Health System, ending an academic affiliation the two had formed in 1993 after the UPHS-Pennsylvania ties ended. "The remaining 270 Pennsylvania Hospital physicians who have faculty appointments at Jefferson will also be required to make a decision about their affiliation in the near future," according to a Jefferson Health System statement. The statement also said that three department chairs within the Jefferson Health System have already decided to leave Pennsylvania Hospital. But Usner said Pennsylvania Hospital has not received any resignations from its 400 to 500 physicians. "I believe that we will lose some physicians, but we don't think we will lost significant numbers," Usner said. Doyle added that Jefferson Health System's ultimatum was anticipated. But she said the Penn Health System doesn't have an official plan to deal with the situation, since UPHS does not know how many physicians will leave Pennsylvania Hospital.

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