Beaumont merger creates major Detroit-area system
The boards of three health systems in southeast Michigan have given the green light to merge, creating a $3.8 billion combined organization.
Beaumont Health System in Royal Oak, Oakwood Healthcare in Dearborn and Botsford Health Care in Farmington Hills signed a definitive agreement about three months after they announced they would explore a merger. The new name of the eight-hospital system will be Beaumont Health.
The deal is significant for the threecounty Detroit region because it “has been somewhat behind the curve in consolidation,” said Allan Baumgarten, a healthcare consultant who analyzes the Michigan market. Last year, Beaumont tried to merge with Henry Ford Health System, a $4.5 billion organization, but physician and cultural differences nixed the deal after six months of negotiations.
The new Beaumont system will account for about 30% of the Detroit market, based on hospital inpatient and outpatient services, where it competes with Henry Ford, Detroit Medical Center and St. John Providence Health System.
“This milestone demonstrates our mutual commitment to working together to improve quality, efficiency and value for our patients,” said Beaumont President and CEO Gene Michalski, who will lead the new system as CEO.
Gene Michalski will lead the newly merged Beaumont Health system.