Spectrum Health and Beaumont Health said today that they “continue to make progress” toward a proposed merger that would create the largest health system based in Michigan, although the regulatory review process has been taking longer than expected.
The two heath systems originally wanted to close the merger this fall. They acknowledged today that they may not meet that timeframe, as a standard federal regulatory review of the transaction continues.
“We are eager to launch our new health system as soon as possible, but recognize that this will likely be beyond the fall,” Spectrum and Beaumont said in a statement. “The Federal Trade Commission is experiencing a surge in filings across all industries and will take longer than originally anticipated to review the BHSH filing. The two health systems are currently responding to a request for additional information from the FTC, which the organizations understand has become increasingly common.”
Grand Rapids-based Spectrum and Southfield-based Beaumont announced in June that they had signed an agreement to explore creating a new health system that would have 22 hospitals, 305 outpatient care centers, and about $13 billion in operating revenue. The combined company would have more than 7,500 employed, affiliated and independent physicians and take on the temporary name of BHSH System.
The two signed a formal integration agreement three weeks ago and said today that “pre-integration planning is now underway, which is permissible under regulatory guidelines, and will not be implemented until closing.”
“The two organizations are beginning to identify representatives to start collaborating on ways to successfully launch the new health system,” the health systems’ statement said. “Spectrum Health and Beaumont Health remain committed to a shared vision to provide more accessible, affordable, equitable and exceptional health care and coverage for people across our state. They continue to be confident that creating a combined health system is pro-competitive and will benefit the communities they serve.”
Spectrum Health through the first half of 2021 recorded $4.5 billion in operating revenue with $230.8 million in operating income, according to a quarterly financial statement posted online. The Spectrum-owned health plan Priority Health accounted for $2.88 billion in operating revenue and $104.1 million in operating income.