BETHLEHEM, Pa.-Muhlenberg Hospital Center in Bethlehem and Lehigh Valley Hospital in Allentown, Pa., said they will merge after a successful three-year affiliation. Expected to be completed in November, the merger would place Muhlenberg under the control of an expanded Lehigh Valley Health Network board of trustees. Five of the board's 26 members would be Muhlenberg representatives. William R. Mason, Muhlenberg's president and chief executive officer, will retire six months after the merger is closed, the hospitals said. Subsequently, he will be retained as a community affairs consultant, said Elliot J. Sussman, Lehigh Valley's president and CEO. Combined, the institutions have assets of $600 million and annual net revenues of $400 million, the executives said.
ABINGTON, Pa.-Abington Memorial Hospital has become the 11th member of the PennCare integrated delivery network. Anchored by Lehigh Valley Hospital in Allentown, PennCare's network of independent hospitals was formed in May 1995 and began entering managed-care contracts in August 1996. In a recent report on Lehigh Valley, Moody's Investors Service, a New York-based bond-rating agency, cited PennCare's 10-year risk-based contract with Aetna U.S. Healthcare, effective Aug. 1, as evidence of the network's growing strength. In the past, Aetna U.S. Healthcare has been reluctant to pass on risk to Philadelphia-based hospitals, Moody's said.
SYRACUSE, N.Y.-Blue Cross and Blue Shield of Central New York and Rochester, N.Y.-based Finger Lakes Blue Cross and Blue Shield have jointly introduced a new long-term-care insurance product called Care Directions. It's the first joint product launch since the two Blues plans affiliated in January. "With Finger Lakes' 10-plus years of experience in long-term care, our central New York plan was able to tap into that expertise and add another health insurance product to our already diverse offerings," said Albert F. Antonini, president and chief executive officer of the Syracuse-based plan. Care Directions allows covered services to be tapped for home care, assisted living and nursing home care.
NEW YORK-Options Health Care said it has acquired Consulting Health Care Systems, a New York-based managed behavioral healthcare organization. Terms of the deal weren't released. CHCS has contracts to manage six Medicaid plans in New York and one in Connecticut. It also provides services to commercial and Medicare HMOs and third-party administrators in the region. Norfolk, Va.-based Options provides behavioral healthcare services to 4 million people in 17 states and Puerto Rico.
MELVILLE, N.Y.-Olympus America, a Melville-based manufacturer of medical imaging equipment, will pay the federal government $22.8 million to settle claims that it overcharged the Department of Veterans Affairs healthcare system. The VA claims it was overcharged because Olympus did not give it the same discounts it gives commercial customers, as required by law and its contract with the VA. The company informed the government of the overcharges as part of VA's voluntary disclosure program.