Prime Healthcare Services plans to downsize Suburban Community to a micro-hospital
Lower Bucks and Roxborough Memorial with also be converted to nonprofit hospitals, but will still have ties to for-profit entities owned by Prime Healthcare Services.
Prime Healthcare will downsize Suburban Community Hospital in East Norriton this summer to a micro-hospital with an emergency department and at least 10 inpatient beds, the California-based health system said this week.
Prime said the changes at the hospital, licensed for 126 beds, were designed to tailor the hospital’s services to community needs. As part of the downsizing, Prime will also suspend services at Suburban’s 15-bed behavioral health unit, citing low demand and difficulty retaining workers.
Suburban is a nonprofit owned by Prime Healthcare Foundation. It remains affiliated with for-profit Prime Healthcare Services Inc., which also owns Lower Bucks and Roxborough Memorial Hospitals.
They will be converted to nonprofits like Suburban, Prime also said this week. As Suburban illustrates, however, converting to nonprofit status will not necessarily end the hospitals’ close affiliation with the for-profit system in Ontario, Calif.
With Suburban, the creation of a micro-hospital further advances a regional trend. ChristianaCare is converting the former Jennersville Hospital into a micro-hospital and plans to open two micro-hospitals in Delaware County next year. Lehigh Valley Health Network is building micro-hospitals in Gilbertsville and Macungie.
Micro-hospitals are designed to fill coverage gaps in areas that can’t support a full-scale hospital. Also called neighborhood hospitals, they must have transfer agreements with hospitals that can handle more complex cases.
Prime said Suburban has transfer agreements with Jefferson Health’s Einstein Philadelphia and Montgomery Hospitals, Temple Chestnut Hill Hospital, and Temple University Hospital.
Ownership change at Lower Bucks and Roxborough hospitals
Prime plans to donate Lower Bucks in Bristol Township and Roxborough Memorial in Philadelphia to the Prime foundation and convert the facilities into nonprofits. Prime acquired both hospitals in 2012. Lower Bucks is licensed for 175 beds and Roxborough for 131 beds, according to state records.
The conversion of Lower Bucks and Roxborough does not guarantee that their financial ties to the for-profit Prime Healthcare Services will end.
Prime Healthcare Foundation pays for-profit Prime entities for what Prime called “advisory and supplemental services” in a statement. Those payments totaled $84 million in 2022, according to the foundation’s audited financial statement. The for-profit also provides health insurance services and a 401(k) retirement plan for Prime Foundation hospital employees, the audit says.
The Prime foundation had $978 million in revenue in 2022, when it owned and operated 13 acute-care hospitals with 2,166 licensed beds in California, Texas, Ohio, Georgia, Pennsylvania, and Rhode Island.
Converting Lower Bucks and Roxborough into nonprofits aligns with prospective legislative changes in Pennsylvania, Prime said.
Some state lawmakers are questioning for-profit hospital ownership. A group of state senators introduced a bill last year that would prohibit for-profits from owning or managing hospitals in Pennsylvania. Another bill under consideration would require far more disclosure when for-profit health systems engage in health-care transactions in the state.