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Underwood-Memorial, SJH Merging This Year

The two hospital systems will join forces after state and federal approval comes through in the next few months.

Underwood-Memorial Health Systems, the parent organization of Underwood-Memorial Hospital in Woodbury, is set to become part of an expanded health system, after formally announcing a merger with South Jersey Health Systems (SJHS) Thursday.

The deal not only means access to all of SJHS's network in Salem and Cumberland counties for Underwood's patients, but also combines the staffs of the two organizations–a total of more than 4,000 employees and nearly 1,000 physicians–without any job cuts.

While it still has to pass muster at the state and federal levels, officials for both organizations said the merger should be finalized some time this spring.

“This is a merger—not a limited venture, takeover or acquisition,” said Peter Galetto, SJHS board chair. “Our vision is to build upon the strengths of both organizations to create new opportunities for all the communities we serve.

“This merger will help both organizations to continue our mission of providing the best possible health care for patients in Gloucester, Cumberland and Salem counties, long into the future.”

After the deal goes through, patients will have access to facilities across three counties, from the 305-bed Underwood-Memorial Hospital in Woodbury, to the 262-bed SJH Regional Medical Center in Vineland to numerous outpatient facilities.

SJHS and Underwood are aiming to capitalize on their combined strengths, spokesman Greg Potter said, from Underwood's cardiac care expertise to the cancer treatment facilities at SJH Regional Medical Center.

The merger also should make the new combined organization better able to recruit top doctors, Potter said.

And with new economic realities and government health care reform, a combined system should be better equipped to handle challenges in the future, officials for both organizations said.

“There is no doubt that health care reform is creating an environment in which partnerships and alliances can be even more beneficial to health systems and the communities they serve,” said Michael McLaughlin, chair of Underwood's Board of Directors. “With significant reductions in Medicaid and Medicare reimbursements expected in the coming years, this merger will better position our organizations to not only meet these fiscal challenges, but to continue to grow.”

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