Jove
Visualize
Contact Us
JoVE
x logofacebook logolinkedin logoyoutube logo
ABOUT JoVE
OverviewLeadershipBlogJoVE Help Center
AUTHORS
Publishing ProcessEditorial BoardScope & PoliciesPeer ReviewFAQSubmit
LIBRARIANS
TestimonialsSubscriptionsAccessResourcesLibrary Advisory BoardFAQ
RESEARCH
JoVE JournalMethods CollectionsJoVE Encyclopedia of ExperimentsArchive
EDUCATION
JoVE CoreJoVE BusinessJoVE Science EducationJoVE Lab ManualFaculty Resource CenterFaculty Site
Terms & Conditions of Use
Privacy Policy
Policies

Related Experiment Videos

Lessons from the Allegheny bankruptcy.

L R Burns1

  • 1University of Pennsylvania, USA.

LDI Issue Brief
|January 14, 2003
PubMed
Summary
This summary is machine-generated.

The Allegheny Health, Education, and Research Foundation (AHERF) failed due to aggressive expansion, leading to bankruptcy. Its collapse offers lessons for academic health centers facing financial challenges.

Related Concept Videos

You might also read

Related Articles

Articles linked to this work by shared authors, journal, and citation graph.

Sort by
Same author

Physician responses to the marketplace: group practices and hospital alliances.

LDI issue brief·2003
Same author

Physician-system alignment: introductory overview.

Medical care·2001
Same author

The ties that bind: interorganizational linkages and physician-system alignment.

Medical care·2001
Same author

Risk assumption and physician alignment with health care organizations.

Medical care·2001
Same author

Implementing evidence-based medicine: the role of market pressures, compensation incentives, and culture in physician organizations.

Medical care·2001
Same author

Factors associated with physician involvement in care management.

Medical care·2001
Same journal

The Current State of Evidence on Bundled Payments.

LDI issue brief·2018
Same journal

State-Based Marketplaces Outperform Federally-Facilitated Marketplaces.

LDI issue brief·2018
Same journal

Exploring the decline of narrow networks on the 2017 ACA marketplaces.

LDI issue brief·2017
Same journal

Narrow Networks on the Individual Marketplace in 2017.

LDI issue brief·2017
Same journal

Stabilizing individual health insurance markets with subsidized reinsurance.

LDI issue brief·2017
Same journal

Issue at the Heart of Advancing the De-Adoption of Low-Value Care. Proceedings from an expert roundtable.

LDI issue brief·2017
See all related articles

Area of Science:

  • Healthcare Management
  • Health Economics
  • Nonprofit Organizations

Background:

  • The Allegheny Health, Education, and Research Foundation (AHERF), a major nonprofit healthcare system, faced significant financial distress.
  • AHERF pursued an aggressive acquisition strategy, expanding its reach by acquiring physicians and hospitals, particularly in the Philadelphia region.

Purpose of the Study:

  • To chronicle the causes and contributing factors behind the failure of AHERF, the largest nonprofit healthcare organization bankruptcy in the nation.
  • To analyze the lessons learned from AHERF's collapse for other academic health centers experiencing financial difficulties.

Main Methods:

  • Case study analysis of AHERF's financial and operational history.
  • Examination of AHERF's bankruptcy filing and subsequent asset liquidation.

Related Experiment Videos

  • Review of market impact following AHERF's failure, including competitor acquisitions.

    • Main Results:

    • AHERF filed for bankruptcy on July 21, 1998, with $1.3 billion in debt and 65,000 creditors.
    • The foundation's aggressive acquisition strategy contributed to its financial downfall.
    • Tenet Healthcare Corp. acquired eight AHERF hospitals at significantly reduced prices following the bankruptcy.

    Conclusions:

    • The failure of AHERF highlights the risks associated with rapid, debt-financed expansion in the healthcare sector.
    • Lessons from AHERF's bankruptcy provide critical insights for the strategic and financial management of academic health centers.
    • The event led to a market shift with the entry of for-profit entities into the Philadelphia healthcare landscape.