ARHS votes to join UPMC

The boards of directors of Altoona Regional Health System and its parent company voted unanimously Thursday to join the UPMC health system on July 1 as “UPMC Altoona,” according to a hospital news release.

It’s the board’s “final action” in an affiliation process that began two years ago and included an “exhaustive analysis” that led to the consensus decision that UPMC was the best available partner, according to the news release.

A state agency continues to conduct an antitrust examination of the deal.

“An affiliation with UPMC will be extremely positive for Altoona Regional, our patients and the entire region,” said Altoona Regional board Chairman Rob Halbritter in the release.

UPMC will invest $250 million over 10 years to upgrade facilities and services, assume all ARHS liabilities and maintain operations at the current campus – core specialities intact – for 20 years, according to the release.

UPMC Altoona will become a regional referral center, governed by a board with a third of its members appointed by UPMC and the rest locally on a self-perpetuating basis – with ARHS appointing one member to the overall system board, according to the release.

UPMC will honor existing labor agreements – and for the rest of 2013, make no changes in human resources or benefits – while communicating subsequent changes “well in advance” through hospital managers and a new merger transition newsletter, according to a managerial talking points memo obtained by the Mirror.

Actual “integration” of the two institutions will begin within six months, according to the memo.

Altoona is joining UPMC to preserve existing services, add new ones and meet the challenges of modern health care, according to the news release.

The state Attorney General’s Office is reviewing the proposed transaction, according to office spokesman Dennis Fisher.

The AG’s oversight has led to the collapse of several mergers in recent years, most recently that of Reading Health System and Reading Surgical Institute, which dropped their plans after the AG’s office and the Federal Trade Commission – which also has antitrust jurisdiction on hospital mergers – announced they intended to sue to block the deal.

“We are working with all of the appropriate regulatory agencies and everything is on track,” Cuzzolina said in regards to the AG’s involvement.

The proposed board arrangement with UPMC is similar to the one put in place with UPMC Hamot in Erie, which entered the UPMC system in 2011.

The leadership of Altoona Regional and its parent company, Central Pennsylvania Health Services Corp., touted the merger as “historic” and its merger partner as “world class,” given UPMC’s consistent inclusion in the hospital honor roll of U.S. News & World Report, in an op-ed submitted to the Mirror Friday by Halbritter and CEO Jerry Murray.

“This relationship means patients will be able to receive an even higher level of care in our region – for years to come,” states the op-ed.