DETROIT -

Beaumont Health System, Botsford Health Care and Oakwood Healthcare announced Monday they had reached a definitive agreement to combine their operations into a new $3.8 billion health care organization following unanimous approval by their boards.

Beaumont Board Chair Stephen Howard, Botsford Trustee Chair Gerson Cooper and Oakwood Board Chairman John Lewis say the agreement reflects their organizations’ common vision to remain leaders in providing high-quality, high-value, not-for-profit health care and their mission of community service.

Under the terms of the definitive agreement, the three organizations are creating a new, not-for-profit Michigan health system called Beaumont Health.

At a glance: Fact sheet for 3 organizations, the new health system

The three organizations announced a letter of intent on March 21 to integrate their combined eight hospitals and 153 other patient care sites into a new comprehensive, collaborative health system focused on advancing quality and access to care throughout the region.

Oakwood Board Chairman John Lewis will be the future chair of the Beaumont Health board.

"While Botsford and Oakwood have outstanding names and brands in their primary communities, we chose the name ‘Beaumont Health’ because of its recognition and strength throughout all of Southeast Michigan and on a national level," Lewis said. "The new health system will be a national model and the name paves the way for an even stronger national voice in the future of health care delivery. And the word ‘Health’ represents our combined goal of improving the health of individuals, families and employers in the communities we serve."

The name also has historical ties to pioneering Michigan physician and medical researcher, Dr. William Beaumont, whose medical research and innovations are recognized globally.

Beaumont President and CEO Gene Michalski will serve as initial CEO of the new health system.

“This milestone demonstrates our mutual commitment to working together to improve quality, efficiency and value for our patients. We’ll be able to share and build on our individual successes and will stand stronger together during a time of major transformation in the health industry," Michalski said.

The new health system will be governed by a single board and executive leadership structure with representation from the three organizations. Michalski, Oakwood CEO Brian Connolly and Botsford CEO Paul LaCasse, D.O., will all serve on the CEO Council, overseeing the transition and implementation of the new system. Michalski will chair the CEO Council. Connolly, LaCasse and Michalski will remain as president and CEO of their respective organizations during the period of transition. Connolly is serving as chief transition executive and Dr. LaCasse is serving as clinical transition executive on behalf of the CEO Council.

“The work to integrate these three great organizations, while challenging, is progressing well. We see the signs that we are indeed creating the health care system of the future – a system in which population health can truly be impacted in a very positive way while increasing quality and value for every family we are fortunate to serve," Connolly said.

The final steps in coming together are state and federal regulatory approvals. With these approvals, the organizations expect to close the transaction in the fall.

Work will also continue to develop detailed transition plans to bring the operations of the three organizations together and to finalize details, such as a location for executive offices and the appointments of board members and the new health system’s executive team. 

The new Beaumont Health organization will have eight hospitals with 3,337 beds, 153 outpatient sites, 5,000 physicians, 33,093 employees and 3,500 volunteers.

The hospitals include:

  • Beaumont Hospital, Royal Oak; Beaumont Hospital, Troy; and Beaumont Hospital, Grosse Pointe
  • Botsford Hospital, Farmington Hills
  • Oakwood Hospital-Dearborn; Oakwood Hospital-Southshore; Oakwood Hospital-Taylor; and Oakwood Hospital-Wayne 

The names of the eight individual hospitals will be linked with the Beaumont Health name and brand in a manner to be determined over time.

A website for the new health system, beaumonthealth.org, has been created to keep the community informed of progress.