PITTSBURGH (AP) — A merger of health insurer Highmark with the West Penn Allegheny Health System is moving forward.
Officials from both companies announced at a news conference Tuesday that they've signed an agreement on the proposed merger. They expect to file it with the Pennsylvania Insurance Department this week.
The emergency room of West Penn Hospital would reopen next year under the plan, which must be approved by state and federal regulators.
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Pittsburgh-based Highmark announced in June it plans to spend $475 million to take over the six-hospital West Penn Allegheny system.
"We hope the review and approval process is thorough and timely," Highmark CEO Kenneth Melani said.
Melani said long-term plans will also focus on delivering some services to patients outside of hospitals, for convenience and cost-effectiveness. He said the Pittsburgh-area community can't afford continued steep rises in health care costs.
The new system will likely offer people a choice between several different Highmark health care policies, Melani said.
Highmark officials say that Dr. Keith Ghezzi will be the new CEO of the West Penn system. Ghezzi is also a director of the Alvarez & Marsal Healthcare Industry Group in Washington, D.C.
Ghezzi said it's too soon to say how many of the 1,500 employees who were laid off last year when West Penn closed its emergency room would be rehired, but said there would be a strong commitment to rebuilding the hospital and its employees.
The deal will provide a financial cushion for West Penn Allegheny, which has lost money in recent years.
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