LVHN formalizes deal to acquire Coordinated Health; CEO DiIorio leaving company

Lehigh Valley Health Network has formally acquired Coordinated Health, which will have a new leader in the culmination of a deal announced in September.

In a statement, LVHN said Coordinated Health CEO Emil DiIorio is leaving the company and Amy Nyberg will serve as Coordinated Health president. LVHN said the Federal Trade Commission and the Pennsylvania attorney general’s office completed their review of the deal last month.

“Together, Lehigh Valley Health Network and Coordinated Health have the highest orthopedic success rates in the region and the most fellowship-trained orthopedic sports medicine specialists, caring for everyone from pee-wee players to Division I and pro athletes with unmatched expertise,” said Brian Nester, LVHN’s president and chief executive officer in the statement.

Nester said patients will continue to see the same Coordinated Health physicians and care teams in the same locations. “We want to assure patients they will continue to receive care with their Coordinated Health doctors just like they do today,” he said in the statement.

For LVHN, the acquisition is the latest development in a period of growth as it competes with St. Luke’s University Health Network to be the region’s dominant provider.

As LVHN and St. Luke’s grew, Coordinated Health had difficulty competing with the regional networks that became more than 10 times its size.

To try to compete, Coordinated Health had reduced spending by 15% since fall 2017. But in December 2017, it was dealt another blow when Geisinger Health Plan, an insurance company that covers people in the Lehigh Valley, dropped Coordinated Health from its coverage, affecting 3,700 patients.

A year later, in December 2018, Coordinated Health agreed to pay $11.25 million and DiIorio agreed to personally pay $1.25 million to resolve allegations of fraudulently billing Medicare and other federal health care programs for unnecessary procedures during knee replacements and other surgeries.

Nyberg has been leading Coordinated Health’s innovation and growth strategy, first as chief integration officer and most recently as president and chief operating officer, according to the statement.

“The union of our organizations affirms our commitment to provide world-class orthopedic, sports medicine and specialty care to our patients and community,” Nyberg said.

Nester said the first visible signs of the integration will be new signage and marketing materials.

As hospitals across the country have consolidated into regional health networks to gain leverage with insurers, LVHN has acquired struggling hospitals in rural regions, such as Pocono Medical Center in 2017 and Schuylkill Health System in 2016.

LVHN in August announced plans to build a hospital in Carbon County and broke ground earlier this month on a health campus in Lower Nazareth Township.

Coordinated Health has 22 locations throughout the Lehigh Valley, Northeastern Pennsylvania and western New Jersey and employs more than 1,200 people in outpatient offices, two hospitals and two ambulatory surgery centers.

Morning Call reporter Daniel Patrick Sheehan can be reached at 610-820-6598 or dsheehan@mcall.com.