Thomas Jefferson University plans to buy a cancer center and part of a health plan from Temple University, transactions the schools said Monday will bring them closer to their goal of "transformative collaboration."
Jefferson, located in greater Philadelphia and southern New Jersey, plans to buy the Fox Chase Cancer Center in Philadelphia from Temple. Jefferson also plans to buy Temple's interest in Health Partners Plan. Both organizations' boards approved the proposed deals, which they have been negotiating since January.
The parties said they won't reach a sale price until they sign a formal agreement in the coming weeks.
Jefferson and Temple say they envision partnering on cancer treatment, care for the underserved, innovation and increasing educational opportunities for students at both schools.
The universities said that the cancer center deal will create new avenues for cancer treatment and research by combining two powerful providers: Fox Chase and Jefferson's Sidney Kimmel Cancer Center.
The Fox Chase Cancer Center's profit margin has exceeded 10% in each of the past five years, even surpassing 14% in 2016, according to Modern Healthcare Metrics. Last year, the hospital drew $38.5 million in operating profit and $374.5 million in operating revenue.
Once Jefferson owns 100% of Health Partners Plan, it will work with the plan's current owner partners—Einstein Healthcare Network, Temple and Jefferson—to provide seamless care for Medicaid and Medicare Advantage patients in the region. Jefferson currently owns a roughly 25% stake in the plan, Jefferson spokesman John Brand wrote in an email. Jefferson and Einstein are currently working to close a proposed merger announced in September 2018. Jefferson expects that deal to close in 2020, Brand said.
"Together with our pending merger with the Einstein Health Network, this unique collaboration with one of the state's premier universities and health systems will present a statewide and national model for coordinated and enhanced access, quality, and clinical experience for patients throughout the community, especially the vulnerable North Broad street and downtown corridors," Jefferson President Dr. Stephen Klasko said in a statement.
Temple President Richard Englert and Klasko pledge to work with the deans of their respective colleges to create opportunities for Jefferson students to benefit from Temple's expertise in specific areas and vice versa.
Earlier this month, Jefferson and Temple were among four academic healthcare organizations that announced a plan to collectively buy bankrupt St. Christopher's Hospital for Children from American Academic Health System. The hospital was included in a recent Chapter 11 bankruptcy case, along with Hahnemann University Hospital, by an AAHS subsidiary.
"We believe that this collaboration signals a new day for healthcare in Philadelphia, and specifically for the patients we serve together," Englert said in a statement. "Given all of the uncertainties that have made healthcare headlines in recent months, we believe that the formation of this collaborative framework is a major step forward for patients, employees, and the public. We can't wait to get started."