Einstein and Jefferson Health Announced Merger

From left: Lawrence Reichlin, Einstein chairman of the boards of trustees and overseers; Barry Freedman, Einstein president and CEO; Stephen Klasko, Thomas Jefferson University and Jefferson Health president and CEO; and Steve Crane, Thomas Jefferson University chairman of the board, sign a letter of intent to merge the two institutions. | Rachel Kurland

Einstein Healthcare Network, the Northeast Philadelphia-based institution whose roots lie in the expansion of Philadelphia’s Jewish community in the late 19th century, is merging with Jefferson Health.

Officials signed a non-binding letter of intent to merge during a press conference last week at Einstein Medical Center, which included an audience of nearly 100 employees, leadership and medical professionals, some still garbed in white coats with stethoscopes hanging around their necks.

According to officials, the merger will blend the two historic and academic medical organizations, intending to make health care more accessible and affordable — connecting Einstein’s MossRehab and Jefferson’s Magee Rehabilitation, two of U.S. News and World Report’s top-ranked rehab hospitals — and expanding students’ network of study.

It will boost academics for both institutions, allowing the two — including both of Jefferson Health’s institutions, Thomas Jefferson University and Philadelphia University — to collaborate.

The new combination will likely establish the region’s largest residency program.

Barry Freedman, Einstein president and CEO, noted the two organizations are not strangers to one another.

Spanning their decades-long relationship, Jefferson students often further their clinical education at Einstein. Einstein physicians also are part of Jefferson’s faculty, and Jefferson physicians provide clinical services at Einstein.

“Both are committed to delivering high-quality health care and training to health care professionals,” he said. “We know and work well with each other.”

The goal is to use their shared values to grow stronger academically, preserve and enhance teaching and research missions, and better meet the needs of patients, regardless of income.

“Together we will move toward caring for entire communities, not just individuals,” he added of the integrated health care initiative.

Einstein Medical Center is the largest independent academic medical center in the Greater Philadelphia/Southern New Jersey region, training more than 3,500 health professional students and 400 residents each year, ranging in 30 different programs.

It began in 1866 as the Jewish Hospital in West Philadelphia with just 22 beds, committed to serving the community “without regard to creed, color or nationality” — a revolutionary concept for its time.

People of all backgrounds — Jewish Philadelphians, immigrants, soldiers returning from the Civil War, free slaves moving to the North — all sought and received care at the Jewish Hospital.

It also established a place for Jewish physicians to learn and practice.

The status of the merger is now in a period of due diligence, where both organizations will analyze more of how the merger will take effect.

Freedman said the second stage of the merger is signing a definitive agreement, most likely this summer, and finally regulatory approvals by December, at the earliest.

Some sort of rebranding will take place, though both entities will retain their names.

“From a patient care standpoint, we believe we will expand access,” Freedman continued. “We believe we will move more quickly to population health, managing large numbers of patients in our geographic region and in our health system. Academically, we are very attracted to training tomorrow’s health care professionals, both allied health professionals as well as medical students. We can do that better in partnership.”

Jefferson Health currently includes 14 hospitals and more than 50 outpatient and urgent care centers. Thomas Jefferson University Hospitals is ranked 16 in the nation by U.S. News and World Report.

The merger will be Jefferson’s sixth acquisition since 2015; the health care network also added Abington Health, Aria Health, Philadelphia University, Kennedy Health System and Magee Rehabilitation into the mix.

Stephen Klasko, Thomas Jefferson University and Jefferson Health president and CEO, said the institution’s mission, which began 194 years ago — to lead as the first medical school in the country intent on studying the human body — does not differ from Einstein’s mission.

And the merger should come as no surprise.

“For Jefferson, Einstein is like that girl or boy you met in high school that you stayed friends with, but all your other friends thought some day you were going to get married,” he laughed.

Klasko, who assumed his position in 2013, noted Jefferson has been on a four-and-a-half-year journey to partner with the most creative academic health centers in the region; the Einstein merger sets a precedent for the transformation of innovative health care.

“I firmly believe that Einstein was the perfect missing piece to the puzzle that was begun four years ago in creating an academic and clinical health system with no address,” he said. “Einstein’s history of caring for the underserved, training health professionals of the future, and embracing change and innovation frankly makes them the perfect partner for our trustees’ goal of helping create a health care innovation revolution.”

A significant part of the merger, he said, is ensuring underserved patients are actually receiving better care at better quality and costs.

“I guarantee you the biggest change we can make together in Philadelphia is not adding one or two patients, but looking at the fact that Philadelphia has one of the greatest discrepancies in life expectancy in the country based on your ZIP code,” he explained.

Steve Crane, Thomas Jefferson University chairman of the board, emphasized Jefferson’s commitment to delivering the best products to its patients at the lowest costs. With Einstein, the value of that care will only increase, he said.

Lawrence Reichlin, Einstein chairman of the boards of trustees and overseers, echoed Crane’s sentiments, adding that Einstein’s clinicians, researchers and staff developed innovative ways “to serve increasingly diverse communities by delivering new technologies and breakthroughs in breast health, organ transplantation, physical medicine and rehabilitation, heart care, OBGYN services, and many other areas.”

If the merger goes through, Jefferson’s estimated yearly revenue will enlarge to $6 billion.

“This is why we chose Jefferson, and why Jefferson chose us,” said Freedman. 

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