Report: Virtua, Kennedy Mulling 'Collaboration Opportunities'

Two of Camden County’s biggest hospital systems could be talking about joining forces, according to a report by NJBiz.com this week.

Virtua Health, which runs a 370-bed hospital in Voorhees and a 95-bed hospital in Berlin, as well as other hospitals in Marlton and Mount Holly; and Kennedy Health System, which operates the 219-bed Kennedy University Hospital on Chapel Avenue in Cherry Hill, as well as other hospitals in Washington Township and Stratford, issued identical, brief statements regarding discussions of unspecified “collaboration opportunities,” according to the report.

The announcement comes roughly a year after two other major South Jersey hospitals formally announced a merger plan.

Underwood-Memorial Hospital in Woodbury and the Cumberland County-based South Jersey Healthcare spent most of 2012 getting the necessary state and federal approvals before finalizing the merger in November. There is no immediate indication Virtua and Kennedy are pursuing a similar plan, however.

Hospital mergers and acquisitions are still big business, totaling more than $30 billion from 2007 through June 2012 alone. Yet a recent study showed less than half of all hospital mergers are financially successful.

Many such consolidations may be motivated by the pressures of the Affordable Care Act and diminished reimbursement rates for doctors, market-watchers say.