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AtlantiCare leaving Pennsylvania’s Geisinger health system

When Geisinger acquired AtlantiCare, it agreed to spend spend $62.5 million at AtlantiCare as part of a five-year investment plan. Neither system has been willing to say whether that happened.

A New Jersey Emergency Management System Task Force tent is set up outside the emergency room at the AtlantiCare Regional Medical Center in Atlantic City in March. Under a deal announced Tuesday, AtlantiCare will no longer be part of Geisinger, a Pennsylvania health system.
A New Jersey Emergency Management System Task Force tent is set up outside the emergency room at the AtlantiCare Regional Medical Center in Atlantic City in March. Under a deal announced Tuesday, AtlantiCare will no longer be part of Geisinger, a Pennsylvania health system.Read moreTOM GRALISH / Staff Photographer

AtlantiCare, a major health-care provider at the Jersey Shore, and Geisinger have decided to part ways, the two nonprofit health systems said Tuesday in a joint statement.

Terms of the split, which could take six to 18 months to complete, were not disclosed, and neither side would comment beyond their statement.

Geisinger and AtlantiCare said they would continue cooperating on joint projects, such as the New Jersey campus of the Geisinger Commonwealth School of Medicine, in Atlantic City.

Geisinger, a central Pennsylvania system known for owning both hospitals and a health insurer, acquired AtlantiCare, in 2015. In January, Geisinger filed a federal lawsuit in Scranton seeking a “declaratory judgment that AtlantiCare has no right to terminate its association with Geisinger.”

According to the lawsuit, AtlantiCare is able to terminate its merger with Geisinger under only two circumstances: “If Geisinger becomes controlled by a religious-affiliated entity or a for-profit entity within 10 years after the closing.”

That lawsuit was voluntarily dismissed Monday.

AtlantiCare has not disclosed why it wanted to get out of the relationship that made Geisinger its owner.

When Geisinger acquired AtlantiCare, it agreed to spend spend $62.5 million at AtlantiCare as part of a five-year investment plan. Neither system has been willing to say whether that happened.

At the time, AtlantiCare had 589 licensed beds on two campuses, in Atlantic City and in Galloway Township.

Geisinger had operating income of $130 million on revenue of $7 billion in the year ended June 30, 2019. It has 11 hospital campuses and a medical school.