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Jefferson Health announced a deal last week to sell some of its clinical laboratory business to Labcorp, one of the nation’s biggest providers of blood tests and other diagnostics.
Details, such as the price and how many Jefferson employees will be affected if the deal closes as expected this summer, were not available. Jefferson did not answer questions about the sale.
Moody’s Investors Service in March downgraded the credit rating of Thomas Jefferson University, which owns Jefferson Health. The credit-rating agency said then that it expected Jefferson’s new management, led by chief executive Joseph G. Cacchione, to pursue sales like the Labcorp deal to help Jefferson raise money.
The nonprofit system’s cash reserves have declined significantly in the last 18 months because of low operating profits and high capital spending on a new outpatient tower at 11th and Chestnut Streets in Center City and other projects, Moody’s said.
Jefferson says its health system and colleges employ 43,000 people around the Philadelphia region. The system has 13 general hospitals, a hospital for neurosciences, and two rehabilitation hospitals. It also owns two orthopedic specialty hospitals as part of joint ventures.
A string of deals
Even before Cacchione arrived last September from Ascension, Jefferson had been selling parts of its businesses.
The month Cacchione arrived, Jefferson filed an application to sell a 190-bed nursing home in New Jersey to Benjamin Kurland, who operates Allaire Health Services, a New Jersey company with 11 nursing homes in three states. The price was not disclosed. New Jersey licensing records show that Jefferson still owns the facility, which is near Jefferson Washington Township Hospital.
Jefferson last summer sold half its stake in the Delaware Valley Accountable Care Organization, a gain of $25 million, according to its financial statement. The ACO’s buyer was Humana, a national giant that competes locally with Health Partners Plans Inc., a Philadelphia Medicaid and Medicare insurance company that Jefferson owns.
In June of 2022, Jefferson put its home health care and hospice business into a joint venture with Bayada, a large national home health care business based in Moorestown. As part of that deal, Jefferson recorded a gain of $31.7 million in its operating revenue.
Changes coming to Jefferson Elkins Park
During the 2020 antitrust trial over Jefferson’s acquisition of Einstein Healthcare Network, Jefferson officials said they would shut the Elkins Park emergency department and eliminate the 60-bed inpatient program there. Jefferson planned to replace them with expanded doctors’ outpatient offices and turn over more space to MossRehab.
Those changes are now imminent, Jefferson said last month in a news release. In addition, inpatient physical rehabilitation patients at Abington Hospital will shift to Elkins Park next month, Jefferson said.
Jefferson is hoping that people who counted on the emergency department at Elkins Park will go to its hospital in Abington (3 miles away) or to Einstein Medical Center Philadelphia (3.6 miles away). Temple’s Jeanes Hospital (2.9 miles away) and Holy Redeemer Hospital (3 miles away) are also close alternatives.