Henry Ford merger delayed

Beaumont chiefs want system to reconsider deal

Five clinical service chiefs at Royal Oak, Mich.-based Beaumont Health System delivered a letter to the Beaumont board of directors asking the board to reconsider its proposed merger with Henry Ford Health System, sources told Crain’s Detroit Business.

Three board members voted to block a vote to reconsider the merger, sources said. The board then tabled a discussion on the issue for at least three weeks to conduct more due diligence on the extent of opposition from the Beaumont physicians, the sources said.

“The chiefs think this merger is a bad deal and are against it,” said a physician knowledgeable about the letter and board meeting. Crain’s was unable to determine whom the clinical service chiefs represent.

Colette Stimmell, Beaumont’s director of corporate communications, said board discussions are confidential. However, Stimmell said Beaumont and Henry Ford have extended their letter of intent. Last October, Beaumont and Detroit-based Henry Ford announced a merger that would create Southeast Michigan’s largest not-for-profit health system, with nine hospitals and $6.4 billion in annual revenue.

The two organizations originally said they wanted to sign a definitive agreement in the first half of this year. “A merger of two prominent organizations is a big decision. So, it’s not unusual for there to be different viewpoints about it,” Stimmell said in an e-mail.

Henry Ford spokesman Dwight Angell confirmed that the system’s board extended the letter of intent. “We maintain our belief that bringing together two strong and high- ly successful health systems is the right thing to do for the community and for the future of healthcare in Michigan,” Angell said in an e-mailed statement.

Two days after the board meeting, Beaumont Executive Vice President and Chief Medical Officer Dr. Ananias Diokno announced plans to step down from the position in June and retire in September. Dr. David Wood, president of Beaumont Physician Partners, will replace Diokno as CMO.

When the systems announced their intent to merge last October, they said their medical staffs would remain separate.

Of the 3,150 doctors on Beaumont’s medical staff, about 2,500 are independent privatepractice physicians.

The Henry Ford system, on the other hand, operates the Henry Ford Medical Group with 1,200 employed physicians and the Henry Ford Physician Network with 650 private practice doctors. The system also has about 2,000 independent physicians on staff at its Wyandotte, Macomb and West Bloomfield hospitals. —