Fox Chase to join with Temple

Fox Chase Cancer Center will become part of the Temple University Health System, officials announced Thursday.

The combination, which is expected to close next summer, will assemble two storied Philadelphia healthcare insitutions, which both have faced fiscal difficulties lately.

Temple, based in North Philadelphia, will get a nationally-recognized research partner that will enable the system to create a cancer unit at Temple's Jeane's Hospital.

Fox Chase, which has made several attempts to expand, will achieve that, taking over some 30,000 square feet of space at Jeanes. Fox Chase Chief Executive Officer Michael Seiden will stay on.

Temple will invest assume $9.4 million into Fox Chase and will assume its debt though offiicals wouldn't say how much that was.

The merger has to go through some regulatory appovals.

Fox Chase has a long and succesful history. It and the University of Pennsylvania's Abramson Cancer Center have the National Cancer Institute's highest designation: comprehensive cancer center, a measure of both clinical care and research. Thomas Jefferson University's Kimmel Cancer Center is an NCI cancer center, the next step down.

Temple and Fox Chase already collaborate on some services, such as doctor training and bone-marrow transplants. They have been in talks about affiliating for several months.

Fox Chase has 100 beds and sees about 8,000 new patients a year. Temple's three hospitals - Temple, Episcopal and Jeanes - total more than 1,000 beds.

Both institutions face financial challenges. Temple's North Philadelphia location attracts large numbers of Medicaid patients, who generate less revenue than patients with private insurance. The system reported operating losses of $48 million in fiscal 2010, but was slightly in the black for the year ending June 2011.

Temple University Hospital's chief executive officer, Sandy Gomberg, stepped down last week and was replaced by an interim adminstrator, John N. Kastanis, a manager at Navigant, a consulting firm. Larry Kaiser, a surgeon, became head of the health system and dean of Temple's medical school eight months ago.

Unlike most cancer centers, Fox Chase is a freestanding institution, unaffiliated with an academic medical center and the more powerful network of referrals they provide. Its location, in the Northeast, well away from major highways, is also a challenge. Fox Chase has been exploring ways to expand for years, but recently gave up on its primary plan - growing into Burholme Park next door - after courts sided with neighbors who opposed the move.