July 17, 2017
Jefferson Health and GE Healthcare announced Monday that they have formed a new, multi-year risk-sharing relationship that will seek to capture $1 billion in efficiencies in the delivery of health care.
The eight-year relationship, targeting the wider Philadelphia region, represents the largest pact of its kind in the United States. Both organizations will work to remove redundancies and improve sourcing for hospitals through the Jefferson Health system, generating a potential savings of between $500 million and $1 billion.
“We have a unique opportunity to become the region’s leader in delivering even greater value to our patients — offering them high-quality care at a lower cost, wrapped around an exceptional patient care experience — every time,” said Stephen K. Klasko, president and CEO of Thomas Jefferson University and Jefferson Health. “With the industry knowledge and global expertise of GE Healthcare, we will gain significant efficiencies that will enable us to reinvest in initiatives that improve the lives of those we care for.”
The partnership will start with a focus on operations and processes in Abington, Aria and Jefferson facilities throughout the region. A shared-risk model will align the economic interests of Jefferson Health and GE Healthcare to achieve a series of milestones in the areas of strategic growth, operations, integration and performance.
“With the healthcare industry facing unprecedented levels of patient demand and increasing cost pressures, it’s great to see health systems like Jefferson seek new and innovative ways to improve better outcomes for patients,” said John Flannery, incoming CEO and chairman elect of GE. “This collaboration, which is financially tied to our shared success, demonstrates the confidence we have to jointly deliver world-class health care for the community.”
News of the deal comes amid an ongoing legislative battle over the future of health care in the United States and a growing gap between critical costs and available funding for hospitals.
“Together, Jefferson and GE Healthcare are charting a new course by taking the necessary steps today that will help shift the healthcare paradigm,” said Klasko. “My message is simple. We need to transform our industry, continue to be optimistic about our future, and embrace disruption, such as consumerism, to effectively change the way we deliver health care in this country.”