Beau­mont merger cre­ates ma­jor Detroit-area sys­tem

Modern Healthcare - - REGIONAL NEWS - —Bob Her­man

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.

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