Saint Peter’s signs LOI to join with RWJBarnabas Health

Saint Peter’s Hirsch: ‘Ongoing changes in health care delivery made it vital for us to identify a dynamic and strong strategic partner that would allow Saint Peter’s to retain its Catholic mission and identity’

By Tom Bergeron
New Brunswick/West Orange | Dec 16, 2019 at 12:51 pm
Breaking News

Saint Peter’s Health Care may soon be joining the RWJBarnabas Health family.

The two institutions announced Monday they have signed a Letter of Intent to explore a potential partnership. The agreement is nonbinding, but it puts the systems on a path toward reaching a definitive agreement, which is expected within the coming months.

Under the terms of the LOI, the role of New Brunswick-based Saint Peter’s as a full-service provider of acute health care services for the greater Middlesex County community would be enhanced. West Orange-based RWJBH would make significant investments in Saint Peter’s and expand the network of outpatient services it currently provides, resulting in an even higher level of care for the community. Saint Peter’s would remain a Catholic institution and continue to abide by the Ethical and Religious Directives for Catholic Health Care Services.

The LOI is the first step in the process of evaluating and designing a new relationship. The structure of the relationship — whether it is a merger, acquisition, partnership or affiliation — has not yet been decided.

Both parties will now engage in a due diligence process to define the specifics of the relationship. Approvals will be necessary from state and federal officials, the Catholic Church and others before the transaction is considered complete.

Saint Peter’s CEO and President Les Hirsch said the agreement puts Saint Peter’s in a stronger position moving forward.

File photo
Les Hirsch, CEO and president of Saint Peter’s University Hospital.

“The rapid consolidation of hospitals in New Jersey and need for greater scale, as well as ongoing changes in health care delivery, made it vital for us to identify a dynamic and strong strategic partner that would allow Saint Peter’s to retain its Catholic mission and identity, remain competitive and yield the best possible outcome for our patients, employees, medical staff and the communities we serve,” he said in a statement. “Working in partnership with RWJBarnabas Health would give us an opportunity to enhance the unique strengths of both organizations.”

The announcement follows the request for proposals Saint Peter’s released in October 2018, when it said it was considering a strategic partner. Saint Peter’s discernment process has involved a comprehensive and detailed analysis of the organization, its rich Catholic mission, the competitive market and broader industry trends, Hirsch said.

The Most Rev. James F. Checchio, who as bishop of the Roman Catholic Diocese of Metuchen is the sole member of the corporation, affirmed his support of the recommendation of the board of governors to pursue the partnership.

“As an independent institution for the last 112 years, Saint Peter’s has helped to fulfill the Church’s mission of healing in an extraordinary way while making Christ’s love and mercy known to people of all ages and backgrounds, from conception to natural death,” he said in a statement.

“Through this proposed strategic partnership, Saint Peter’s will be strengthened to continue to serve those who are in need of — and greatly benefit from — the excellent, accessible and life-affirming care intrinsic to Saint Peter’s Catholic identity and mission. This partnership will also position Saint Peter’s to continue caring for the whole person with a compassionate response and to greater inform the wider community to the full range of human needs, hallmarks of our Catholic faith.

“I am grateful for the work of Saint Peter’s leadership in bringing this potential transaction to this stage, and am particularly appreciative of the ongoing oversight and guidance of Dr. John Haas, president emeritus of the National Catholic Bioethics Center, in assuring that any transaction is structured such that Saint Peter’s will remain stalwart in its fidelity to the Catholic health care tradition.”

File photo
Barry Ostrowsky, CEO of RWJBarnabas Health.

The parties have been in discussions for some time and share a common perspective and culture regarding providing high quality, cost-effective services to their communities consistent with their respective missions and the need to move in the direction of population health management.

RWJBarnabas Health CEO and President Barry Ostrowsky said coming together makes sense for all parties involved — especially those seeking health care services.

“The rapidly changing health care landscape presents new challenges and opportunities,” he said in a statement. “Saint Peter’s is a vital resource to central New Jersey, and through this agreement we would greatly enhance our commitment in these communities with our mission of improving the health and well-being of its residents.

“With tremendous support from municipal, county and state elected officials, our Robert Wood Johnson University Hospital academic medical center has enjoyed a longstanding collegial relationship with Saint Peter’s, and we are incredibly excited about the many possibilities for enhanced collaboration signaled by this Letter of Intent.”

RWJBarnabas Health is New Jersey’s most comprehensive academic health care system, with a service area of nine counties covering 5 million people. The system includes 11 acute care hospitals, three acute care children’s hospitals and a renowned pediatric rehabilitation hospital, among many other facilities. RWJBH has a partnership with Rutgers University, creating New Jersey’s largest academic health care system.

Saint Peter’s University Hospital, a 478-bed acute-care teaching hospital sponsored by the Roman Catholic Diocese of Metuchen, is the flagship of Saint Peter’s Healthcare System that also includes the Children’s Hospital at Saint Peter’s. Saint Peter’s is one of a few independent Catholic hospitals in the country sponsored by a Roman Catholic diocese.