Physician groups save hospitals in Pennsylvania, Oregon

However, a multispecialty clinic's effort to build a new hospital in Indiana falls apart.

By Katherine Vogt, AMNews staff. Aug. 16, 2004.

Tenet Healthcare Corp. has agreed to sell Medical College of Pennsylvania Hospital for $1 in a deal that should keep the troubled hospital open while its operations are handed over to a group led by physicians.

After months of legal wrangling and negotiations, Tenet and state officials in Pennsylvania announced on July 29 that they had struck a deal to keep open the hospital whose fate has been uncertain since Tenet revealed in December 2003 that it intended to shutter the money-losing facility.

Under the agreement, Tenet said it would keep the hospital open until Aug. 31 -- a month beyond the July 30 closure date previously set -- at which time East Falls Hospital System would assume operations of the facility. East Falls, a nonprofit organization, was created by Nancy Pickering, MD, a cardiologist who led an effort to save the hospital from closure.

Tenet also agreed to sell the MCP facilities and grounds for $1 to WMCH Inc., a nonprofit corporation created by Pennsylvania after the state stepped in to ensure that the hospital would stay open.

Tenet Pennsylvania spokesman Jeff Jubelirer said the hospital had been losing more than $5 million a month, prompting the company's decision to pull out of it. "The $1 transaction was the best alternative to closure," he said.

East Falls is expected to enter into agreements with the Drexel University College of Medicine and other academic partners so the 379-bed hospital can continue its tradition of being a teaching facility.