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Allegheny Health Network CEO 'unbelievably qualified'

| Monday, April 29, 2013, 9:48 p.m.
James Knox | Pittsburgh Tribune-Review
Allegheny Heath Network president and CEO John Paul.

John Paul knows all about Highmark's bitter rivalry with UPMC.

Paul, 62, will be president and CEO of Pittsburgh's new hospital system — Allegheny Health Network — after spending much of his career as second-in-command at UPMC.

He was credited with working out an unprecedented 10-year contract between UPMC and Highmark in 2002.

“He is unbelievably qualified and knows UPMC like the back of his hand,” said Jan Jennings, president of the health care consulting firm American Healthcare Solutions, Downtown.

Paul, who will be CEO of West Penn Allegheny Health System, spent most of Monday ironing out details of the $1.1 billion deal to acquire West Penn Allegheny. He appeared satisfied — smiling and shaking hands — as Highmark officials announced its approval by the Pennsylvania Department of Insurance.

Paul referred to the past few months as turbulent and repeatedly used the word courage as he addressed Highmark and West Penn Allegheny employees gathered at the Penn Avenue Auditorium, Downtown.

“It took courage for West Penn Allegheny's board to choose Highmark as a partner,” he said. “It took courage from Highmark's board to make the investment that it has.”

Among the first tasks on his to-do list: recruit physicians for the Allegheny Clinic. That's not a medical clinic; it's a group of about 1,200 physicians who will work as part of the Allegheny Health Network. The Allegheny Clinic will be led by Dr. Tony Farah, West Penn Allegheny's chief medical officer.

Farah said more than 200 physicians joined West Penn Allegheny during the months of negotiations with Highmark. More than 1,000 doctors expressed interest in the new system and said they would consider joining it once the deal was approved, he said.

The number of UPMC physicians who have called West Penn Allegheny to inquire about work “far outnumbers the number (of doctors) that we need,” Farah said at a briefing with reporters, prompting a chuckle from Paul.

Paul said some of his other priorities include capital improvement projects at flagship hospitals Allegheny General in the North Side and West Penn in Bloomfield, where there will be renewed focus on women's care and neonatal care.

Health industry analysts say Paul's biggest challenge will be to turn around West Penn Allegheny, which reported steep losses in the past five years. It recently posted operating losses of $33.1 million for the October-December quarter in 2012.

“They've got to stop the bleeding,” said Martin Gaynor, professor of economics and health policy at Carnegie Mellon University. “You can't lose so much money in one year and be a viable alternative.”

Paul is believed to be looking at other hospitals in the region, including eastern Ohio and as far east as Reading.

Luis Fábregas is a staff writer for Trib Total Media. He can be reached at 412-320-7998.

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