The West Virginia University Health System is expanding its reach into western Pennsylvania. Morgantown-based WVU Medicine announced Wednesday that it is acquiring Independence Health System, the Greater Pittsburgh region’s third largest medical provider.
WVU Medicine will invest $800 million over the next five years to upgrade the hospitals and grow clinical services aimed at expanding health care access in the region. Independence Health System oversees Butler Memorial, Clarion, Frick, Latrobe and Westmoreland Hospitals. The western Pennsylvania system has a 10-county footprint and a combined bed count of 925.
IHS executives said Wednesday that WVU Medicine’s acquisition could stabilize the five hospitals and position them for growth.
“This is a transformational moment for our organization as we take this first, critical step toward building a new future with a nearby health system that shares our values and is community focused,” said Ken DeFurio, IHS president and CEO.
The news comes as IHS continues to post eight-figure operating losses despite cutting costs and reducing staff. The health system first formed in 2023 when the struggling Excela and Butler health systems merged to form a new entity. IHS reported operational losses of $74 million in its first year and $41.4 million in 2024.
IHS has struggled under the shadow of the region’s larger health systems Highmark and UPMC. The bigger systems are also among the largest insurance companies in the market.
WVU Medicine’s takeover of the five hospitals would come with its own insurance administrator Peak Health Insurance Corp. The acquisition would mean western Pennsylvania’s three largest health systems are also insurance providers.
The merger is scheduled for the fall of 2026 but is still subject to state and federal regulatory review as well as bondholder consent. The terms of the acquisition were not disclosed on Wednesday.
Michael Benson, West Virginia University president and chair of the WVU Health System board of directors called the merge “the start of a new chapter built on shared values, deep respect and admiration for the work already being done, and a mutual commitment to the patients and families who depend on these hospitals every day.”
“Together, we can build on that solid foundation and expand the reach of exceptional care throughout the region,” he said.
Paul Bacharach, chair of the Independence Health System Board of Directors, said the merger will ensure IHS providers can continue to provide locally based health care to its 750,000 patients.
“WVU Medicine has clearly demonstrated to us that they are committed to high-quality community health, with services available and accessible locally,” he said. “This affiliation honors our legacy and positions our hospitals for innovation, stability, and growth.”