Why Should Delaware Care?
The proposed hospital merger would have consolidated resources for Delaware’s largest health system farther north on I-95. Still, the hospital has continued its push north of Delaware, while also attempting to dismantle oversight regulations in the state.
Two regional health care powerhouses that had announced their intent to merge operations in July, said on Thursday they are walking back those plans and continuing operations separately.
ChristianaCare and New Jersey-based Virtua Health terminated a letter of intent they signed this summer that signaled the organizations were considering merging their health systems in the coming years.
In a press release on Thursday, ChristianaCare said the hospitals “mutually agreed” to cancel those plans, and they remain committed to “providing high quality, compassionate care” in their respective regions.
“After thoughtful evaluation, both organizations have determined that they can best fulfill their missions to serve their communities by continuing to operate independently,” the release said.
It’s unclear why the hospitals decided to cancel the merger, and a spokesperson for ChristianaCare declined on Thursday to comment further.
Virtua Health also declined to comment.
The deal represented a potential mega merger in the mid-Atlantic region and a power move from ChristianaCare, which has been expanding north of Delaware for years.
Combining the current ChristianaCare and Virtua Health footprints would create a system covering more than 10 contiguous counties in New Jersey, Delaware, Pennsylvania and Maryland, with more than 600 facilities, nearly 30,000 employees and more than 500 residents and fellows.
The deal also would have required numerous regulatory sign-offs in both states, pitting potential hurdles to completing the deal. That includes a review by Delaware Attorney General Kathy Jennings and New Jersey Attorney General Matt Platkin.
In Delaware, the prospect of an out-of-state merger was met with skepticism from Gov. Matt Meyer, who challenged the move when asked about it at a press conference in July.
“I think when any medical practice in Delaware, and especially nonprofit hospitals, get some positive return from serving Delawareans’ health, that money should be reinvested in Delaware, not in another state,” Meyer said in July.
A spokesperson for Meyer did not return a text message Thursday morning asking whether or not his office had any part in the hospital’s decision to back out.
The merger also left questions about competition in the region, and how patients may have been squeezed, given its effort to consolidate market power.
Since 2020, ChristianaCare has ventured deeper into the Philadelphia health market, purchasing defunct hospitals and building their own in the surrounding towns. The hospital system announced earlier this year it would partner with the Children’s Hospital of Philadelphia, better known as CHOP, leaving Delaware’s chief pediatric hospital on the sidelines.
ChristianaCare holds tremendous political power in Delaware, and even deeper pockets. Spotlight Delaware reported earlier this year the hospital has doubled its revenues in the last decade, while raking in hundreds of millions in surpluses each year.
Still, its investments in free and discounted care for disadvantaged patients remained stagnant.
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