Scranton Scramble: CHS to Acquire Moses Taylor, Geisinger to Buy CMC

John Commins, July 20, 2011

In the span of an hour or so on Tuesday, Scranton, PA's hospital alignment underwent a seismic shift.

First, Community Health Systems, Inc. -- which acquired Scranton's Regional Hospital in April -- announced Tuesday morning that it will buy the nearby nonprofit Moses Taylor Health Care System. About one hour later, Geisinger Health System confirmed local media reports that it was acquiring the Community Medical Center, located near the CHS hospitals in Scranton.

CHS acquires Moses Taylor Health Care System
"We are celebrating today. It's a great day for our community. The community is going to benefit. Our patients are going to benefit, and it's a tremendous stimulus in a market that has been long-identified as having to change," Moses Taylor CEO Karen Murphy, RN told HealthLeaders Media in an interview.

Murphy said the purchase price of the CHS acquisition would not immediately be made public because due diligence is still underway and the deal is not expected to be completed until 2012.  

She said, however, that for-profit CHS will invest $60 million over five years in facility and technology upgrades for the health system, in addition to the $60 million the Franklin, TN-based for-profit hospital chain has committed for Regional Hospital.

"Our market is we have three acute-care hospitals within three city blocks. Our market just couldn't sustain the same business model," Murphy says. "We began a year ago to investigation possibilities. We were looking for a partner that would be able to provide capital and improve the quality and cost of healthcare of our community. With the collaboration between Scranton Regional and Moses Taylor, we are going to look at how we can increase quality and efficiency."

John Commins

John Commins is a senior editor at HealthLeaders Media.


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