New Jersey hospital systems sign definitive merger agreement

Months after announcing plans to come together, the Atlantic Health System and Saint Peter’s Healthcare System have reached a definitive merger agreement.

The two systems made the announcement earlier this week. Under the agreement, Atlantic would acquire Saint Peter’s. The systems signed a letter of intent to merge in January.

Atlantic operates seven hospitals in New Jersey and more than 550 other healthcare locations. The system serves patients across much of the Garden State, as well as patients from New York and Pennsylvania. Saint Peter’s operates a 478-bed teaching hospital, a children’s hospital and perinatal center.

The deal still requires the approval of federal and state regulators, as well as the Catholic Church. If the deal is approved, Saint Peter’s would retain its Catholic identity, officials said.

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Brian Gragnolati, president and CEO of Atlantic Health System, called it the “next step in our commitment to more accessible, affordable health care for the people of New Jersey.”

“We are thrilled to partner with Saint Peter's in delivering high-quality care that builds healthier communities,” Gragnolati said in a statement.

Leslie D. Hirsch, Saint Peter’s president and CEO, called the definitive agreement an “important milestone.”

“We are enthusiastic about becoming a part of Atlantic Health with its outstanding reputation for excellence in patient care that aligns well with our culture and mission,” Hirsch said in a statement. “This ensures that Saint Peter’s will remain a strong presence in the central New Jersey area serving the community as a Catholic hospital for many decades to come.”

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Atlantic is touting the opportunity to provide additional resources and services for Saint Peter’s clinicians and patients, including more outpatient services. Assuming the deal is finalized, Atlantic will bring Epic’s electronic health record platform to Saint Peter’s. Atlantic also said it will share its advanced data analytics technology with Saint Peter’s, which will help clinicians improve outcomes and lower costs.

Saint Peter’s has been looking for a partner for some time. Two years ago, Saint Peter’s had planned to join RWJBarnabas Health, but the Federal Trade Commission opposed the transaction, leading the organizations to drop the planned deal. The FTC argued the deal would have hurt competition and prices for acute care services in Middlesex County, although New Jersey regulators had signed off on the deal.

This isn’t the only hospital deal moving forward in the Garden State.

Cooper University Health Care is also planning to acquire Cape Regional Health System in southern New Jersey. The two systems have received approval from the New Jersey Superior Court to move forward with their consolidation plans.

Across the Delaware River, Jefferson Health is planning to acquire the Lehigh Valley Health Network. Jefferson and Lehigh Valley announced a definitive agreement to merge last month as they move to create a 30-hospital system serving the Philadelphia region and eastern Pennsylvania.

The University of Pennsylvania Health System announced in January that it plans to acquire Doylestown Health, a provider in the Philadelphia suburbs. Doylestown would become a part of Penn Medicine when the deal is complete.

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