Einstein warns of cuts, ‘death spiral’ without Jefferson merger

In a court filing, Einstein Healthcare Network cautioned that a relocation by the Federal Trade Commission to block its merger with Jefferson Health could result in a “death spiral” at its Philadelphia flagship safety-net medical facility, according to the Philadelphia Business Journal.

” Jefferson and Einstein have a history of contending versus each other to enhance quality and service,” the FTC stated in February. “The proposed merger would eliminate the robust competitors between Jefferson and Einstein for addition in health insurance business healthcare facility networks to the detriment of clients.”.

Alia Paavola –
Tuesday, October 20th, 2020

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Einstein said it will sustain even higher losses, largely since of the tough payer mix and big underinsured or uninsured population of its flagship Philadelphia medical center..

Einstein and Jefferson Health countered that a combined system still would deal with competition from other hospitals and operate in a difficult market controlled by one healthcare insurer, according to the report..

The FTC revealed in February its intent to take legal action against to obstruct the proposed merger, arguing that integrating the two systems would decrease competition in Philadelphia and Montgomery counties.

In court files opposing an FTC analysis of the merger, Einstein said that its monetary condition has actually weakened since 2017, resulting in operating losses balancing about $30 million per year.

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Without a merger, “Einstein [would have to] significantly cut its services at Einstein Medical Center Philadelphia, resulting in job losses and even further decreases in upkeep and needed financial investment, speeding up a death spiral that would endanger access to health care for a lot of Philadelphias underserved locals,” Einstein composed in the files, according to the Philadelphia Business Journal..