UPMC Susquehanna buys Lock Haven, Sunbury hospitals

Health care in the region continues to undergo changes with new alliances and affiliations being formed among hospitals.

On Wednesday, UPMC Susquehanna revealed it has signed an “asset purchase agreement” to acquire Lock Haven and Sunbury Community hospitals.

The announcement comes less than a year after Susquehanna Health, then part of a four-hospital alliance, became affiliated with UPMC.

Last month, Geisinger Health System announced plans to acquire Jersey Shore Hospital.

“We are excited to extend our tradition of high-quality, compassionate care to the Lock Haven and Sunbury communities,” UPMC Susquehanna President Steven P. Johnson said. “Bringing these hospitals into our family allows us to reinvest in both facilities to improve access, enhance care and grow existing services.”

The 47-bed Lock Haven Hospital and the 70-bed Sunbury Community Hospital each have reflected struggling finances in recent years.

The Pennsylvania Health Care Cost Containment Council (PHC4) reported negative operating margins in fiscal year 2016 of 58.94 percent for Sunbury and 26.95 percent for Lock Haven.

Operating margins reflect the percent of revenue remaining after all operating expenses are paid and include patient care and other related functions, according to PHC4. A negative operating margin indicates revenues are not covering costs.

In addition, net patient revenues for the past three years were negative 7.78 percent for Sunbury and negative 0.35 percent for Lock Haven.

Both Lock Haven and Sunbury are for-profit hospitals operated by Quorum Health Corp.

Lock Haven Hospital CEO Steven Davis and Sunbury Community Hospital CEO Bob Williams welcomed the purchase agreement.

“We are pleased to join the UPMC Susquehanna family,” Davis said. “UPMC Susquehanna is well-known for providing patients with high-quality doctors, nurses and medical staff close to home. Joining this innovative team is a great win for our community.”

Williams said, “The employees of Sunbury Community Hospital are greatly looking forward to our new relationship with UPMC Susquehanna. This strong alliance allows us the ability to continue providing compassionate, patient-centered care built on the foundation of their excellent reputation for cutting-edge medicine with compassion and affordability.”

Officials noted that transition teams will work to develop plans to align operational systems by the fall.

No immediate changes in operations are expected at the hospitals.