Wednesday marks the dawn of a new era of health care in the area as Blue Mountain Health System officials announced it would be merging with St. Luke’s Health Network.

The two sides announced the deal during a press conference on the Gnaden Huetten campus in Lehighton.

One day earlier, Blue Mountain President and Chief Executive Officer Andrew Harris penned a letter informing the system’s 1,000 employees of what he called a “win-win” affiliation.

“As you know the health care delivery system is changing and we have struggled financially this past fiscal year as well as had continued difficulty in recruiting physicians, surgeons and physician extenders,” Harris wrote in the letter.

“The BMHS board of directors began searching for ways to address the issues and needs that we face to best assure that quality health care services would continue to be available in Carbon County now and in the future. Through a deliberate process, the board considered possible health systems that we might partner with to meet our goals.”

An agreement was signed by the boards of both organizations on Monday.

Steven Serfass, chairman of the Blue Mountain Health System’s board of trustees said, “This affiliation agreement was made with the best interests of our community and our employees in mind. We wanted to ensure that the residents of Carbon and neighboring counties would continue to receive the highest quality, most cost-effective health care now and for years to come. St. Luke’s long history of these qualities made it the ideal partner.”

Finalizing the transaction will likely take three to six months to complete, Harris said. During that time, Blue Mountain and St. Luke’s will pursue all of the necessary regulatory approvals.

Blue Mountain merged Gnaden Huetten Memorial in Lehighton and Palmerton Hospital in Palmerton in July 2004.

The two hospital campuses were two of only seven hospitals in the state to be recognized by the Pennsylvania Department of Health, receiving the “Above and Beyond Award for Excellence in Health Care Compliance” award. The health system also features The Summit at Blue Mountain, a 91-bed skilled nursing facility, rehabilitation centers in Albrightsville, Nesquehoning and Kresgeville, and a number of laboratories.

What it means

Harris said any name change for the two hospitals would be determined by the time the agreement is finalized, expected to be by the end of the year.

“Since 2004, the nonprofit vision of Blue Mountain has been to promote, maintain and restore the good health of all the people in the communities we serve through partnerships for excellence in health care service delivery,” Harris said. “Although we have had to weather several storms, namely numerous Medicare reimbursement reductions and declining inpatient and surgical volume, we have always remained focused on our mission to deliver the highest quality of care to the communities we serve.”

Harris said when he came to Blue Mountain he vowed to grow and strengthen the health system by creating programs and services needed in the community. In his letter to employees Tuesday, he proclaimed that mission a success.

“We expanded our home health service area, developed three behavioral health centers and achieved certification as a primary stroke center,” Harris said.

Blue Mountain will be the latest in a line of independent health care systems to affiliate themselves with St. Luke’s. Quakertown in 1995, Allentown in 1997, Miners in 2000 and Warren in 2011 were all struggling and facing an uncertain future, Harris said.

“St. Luke’s invested capital, expertise and other resources to update facilities and technology at those hospitals, and they plan to do the same throughout BMHS,” he added. “All are now financially strong and enjoy enthusiastic community support.”

St. Luke’s has seven hospitals and more than 270 outpatient sites serving 10 counties in Pennsylvania and New Jersey.

“Health care is a local issue and, as such, health care services should be easily accessible to the community,” said St. Luke’s CEO and President Richard A. Anderson.

“Over the years, St. Luke’s has achieved a longstanding, highly successful record of working collaboratively and forming successful partnerships with community hospitals that have joined our network. We have extended our nationally recognized quality programs to those locations. Our partnerships with community hospitals in Allentown, Quakertown and Coaldale, and in Phillipsburg, New Jersey, exemplify the benefits that come to a community through the type of relationship we have planned with Blue Mountain.”

St. Luke’s will not pay Blue Mountain as part of the agreement. Instead, Harris said, the deal includes promises by St. Luke’s that it will commit to maintain hospitals in Palmerton and Lehighton as acute-care facilities, offer employment to all BMHS employees in good standing with the system, maintain charity care policies similar to other St. Luke’s hospitals, retain members of the medical staff of BMHS and assume physician employment agreements.

“Original hire dates at BMHS will determine seniority and benefit eligibility after the transaction to St. Luke’s,” Harris said. “Future changes to compensation and overall benefits are expected to be beneficial to BMHS employees.”

While searching for a viable health care partner, Blue Mountain’s board leaned toward St. Luke’s in large part due to their “record in working with and reviving other struggling hospitals.

“The promise to continue our nonprofit mission, preserve our 1,000 employees and medical staff, continue and expand existing services, and attract other specialty physicians to Carbon County were other primary motivators,” Harris said. “The community wins. The hospital wins. The network wins.”