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Beaumont and Henry Ford announce plans to merge

Two of Michigan’s largest hospital groups – Henry Ford Health System and Beaumont Health System – announced on Wednesday plans to combine into a new $6.4 billion organization.

The boards of the two health systems said in a press release that the new organization will integrate their combined 10 hospitals and 200 other patient care sites under unified executive leadership.

“Both systems recognize that the way health care is provided today – where it is offered, how it is paid for, how it is measured – is changing dramatically,” said Steve Howard, chairman of the Beaumont Health System board of directors in the press release announcing the merger. “Reimbursement for care is declining, the care itself is shifting to more convenient outpatient settings and more emphasis is being placed on keeping people healthy, not just treating them when they are sick.”

“Our shared vision is to form a new organization that will develop improved approaches to patient care that will lead the nation in quality outcomes, service, access and reliability,” said Nancy M. Schlichting, CEO of Henry Ford Health System, in the press release. “It is a bold and exciting vision that will mean easier, more accessible and more integrated care for our patients. Coming together allows us to create a ‘Pure Michigan’ community-based system that will serve as an engine of innovation and economic development.”

The Detroit Free Press reported that Beaumont has been exploring a partnership for the last six months. Among the possible partners was Nashville, Tenn.-based for-profit, Vanguard Health System.

The merged nonprofits will be led by a single board with equal representation from both health systems; will combine their existing foundations into one but with donors able to designate their gifts; and will maintain independent medical staffs. A name for the merged organization will be created but both organizations will continue to use their current names.

A definitive agreement for the merged, nonprofit health system is expected in the first six months of 2013.

 

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