Kaufman Hall Advised Pocono Health System on Merger With Lehigh Valley Health Network

SKOKIE, Ill. – March 1, 2017 – Pocono Health System (PHS) has merged with Lehigh Valley Health Network (LVHN) as of December 2016. Under the merger, Pocono Medical Center has been renamed Lehigh Valley Hospital-Pocono.

Kaufman Hall served as exclusive strategic and financial advisor to PHS.

PHS had operated a 239 bed, full-service acute care hospital located in East Stroudsburg, Pennsylvania (Monroe County) approximately 100 miles north of Philadelphia and 75 miles west of New York City. The system employed more than 2,000 people and with a medical staff in excess of 270 physicians providing a variety of inpatient and outpatient services to East Stroudsburg and the surrounding communities.

PHS had stable and consistent performance; however, its board of directors and leadership team recognized that a new set of core competencies were required to compete in a more competitive market and maintain success in the rapidly changing healthcare environment. As a result, PHS began a process in mid-2015 to review strategic options to ensure that the system remained an essential community provider and continued to meet the healthcare needs of East Stroudsburg and the surrounding communities for generations to come.

Kaufman Hall’s role commenced with an assessment and evaluation of PHS’ strategic alternatives inside its service area and broader market, including the option to remain in its current configuration as an independent entity. The system board of directors ultimately determined that the organization would best achieve its mission, vision, and strategic plan by affiliating with an organization that offers resources and capabilities that could help PHS accelerate the transformation required to succeed in the new healthcare environment.

As exclusive advisor to PHS, Kaufman Hall led the transaction process to ensure that the system’s goals and objectives were achieved. As a part of this process, Kaufman Hall identified a select group of potential partners, each with a strong strategic and financial rationale for affiliating with PHS. Kaufman Hall led the transaction’s overall planning and timing, prepared all marketing and solicitation materials, contacted the potential partners, received and analyzed proposals, helped conduct site visits and interviews, coordinated all potential partner presentations, and drafted and negotiated the term sheet on behalf of the system.

"Our organizations came together to ensure people receive the quality health care they expect and deserve right here in the Poconos," LVHN CEO Brian Nester said at a news conference in December.

Learn more about Kaufman Halls approach to helping senior executives and trustees of independent hospitals meet the unique opportunities and challenges of healthcare’s new business model in a series of ebriefs: Readiness for Healthcare's Transformation.

To learn more about how Kaufman Hall is assisting healthcare organizations with mergers and other strategic partnerships, contact Hector Torres at htorres@kaufmanhall.com or 847.441.8780.