Susquehanna Health rejected Geisinger overtures before joining UPMC: court case

WILLIAMSPORT – Susquehanna Health rejected Geisinger’s openings before joining University of Pittsburgh Medical Center in 2016.

This was revealed in UPMC’s comments on the proposed Justice Department antitrust lawsuit settlement that prevents Geisinger from having a 30 percent stake in the Evangelical Community Hospital near Lewisburg.

Neither the UPMC of North Central Pa., Headquartered in Williamsport, nor Geisinger have confirmed that such discussions have taken place.

“While we cannot speak to specific situations, we often enter into discussions with like-minded organizations interested in supporting the continued health and well-being of our patients, members and neighbors,” said Joseph H. Stender from Geisinger.

Geisinger did not say whether the decision to build a hospital in Lycoming County was related to Susquehanna’s rebuff. The hospital near Muncy is expected to open in December.

Steven P. Johnson, the former president of Susquehanna Health who holds the same position with UPMC in north-central Pennsylvania, declined a request for an interview.

The part of the UPMC document filed in the United States Middle District Court mentioning Geisinger’s interest in Susquehanna states:

“As an independent community hospital with an annual turnover of around $ 260 million, Evangelical knew it was vulnerable to competition from Geisinger, the largest supplier in the relevant market, with turnover more than $ 7 billion annually.

“Meanwhile, Geisinger had long feared that Evangelical might team up with a hospital system or an insurer to compete even more intensely” against Geisinger.

“Geisinger’s concern was heightened in 2017 when Evangelical announced that it was looking for a strategic partner.

“This happened right after Susquehanna Health System joined UPMC in (October) 2016, after rejecting Geisinger’s openings.

“To avoid a potential repeat whereby a neighboring competitor grew stronger, Geisinger intended to create an indefinite partnership to ensure that Evangelical is’ tied to us’ so that ‘they don’t go to a competitor. . “

“The stage was set for a merger or collaboration that would solve both Geisinger and Evangelical problems. “

The UPMC and four people responded for a 60-day period to the public comments that were triggered in March when Judge Matthew W. Brann gave his preliminary approval to the settlement that caps Geisinger’s interest in Evangelical at 7.5. %.

UPMC maintains without modification that the settlement agreement will harm competition.

In August 2020, the Justice Department sued to block the collaboration agreement between Geisinger and Evangelical, saying it would restrict trade and reduce incentives for aggressive competition.

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