Once burned, Geisinger Health System decided against looking for another match.
Last week, the two-hospital not-for-profit system based in Danville, Pa., called off merger talks with three-hospital Mercy Health Partners, a Scranton, Pa.-based subsidiary of Catholic Healthcare Partners. The organizations mutually agreed that a union would be too costly and that physician loyalties might stand in the way of making the merger work. The decision was made after separate meetings of the Geisinger and Mercy boards, and a subsequent meeting between Geisinger's and Mercy's corporate leaders.
"Both healthcare systems should be complimented for completing a rapid, detailed and responsible assessment that underscores the quality, respect and professionalism of those associated with each system," John Nespoli, president and chief executive officer of Mercy, said in a written statement.
A similar conciliatory tone was struck by Geisinger officials, who remarked that the physicians and management staffs at Mercy-some of whom are longtime members of the open medical staff at 132-bed Geisinger Wyoming Valley Medical Center, Wilkes-Barre, Pa.-were cooperative throughout the process.
Negotiations between Geisinger and Mercy began in February, and after reviewing a feasibility assessment of the proposed merger by PricewaterhouseCoopers, the two sides halted discussions. They made the announcement on June 28, exactly one year after Geisinger broke off a 3-year-old merger with Milton S. Hershey (Pa.) Medical Center.
That deal fell apart over irreconcilable cultural differences: Hershey's academic focus failed to meld with the disciplined, corporate style at Geisinger. The system walked away with $150 million in alimony from Hershey. That figure represented a buy-back of the accounts receivables and a net exchange of the assets that Hershey accrued during the short-lived merger.