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February 07, 2018 12:00 AM

Carolinas HealthCare changes its name to Atrium Health

Alex Kacik
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    Carolinas Medical Center

    Carolinas HealthCare System changed its name to Atrium Health, the Charlotte-based health system announced Wednesday.

    The branding of Atrium Health, which represents a "place filled with light, diverse thinkers and the chamber of the heart where every beat begins," will take about two years to implement across its network, the organization said.

    Carolinas said that it was important to have a name that didn't limit it to a specific geographic area. The name change is unrelated to its proposed merger with UNC Health Care, as they continue to discuss branding for their joint operating company.

    Carolinas and UNC Health signed a letter to create a joint venture in August to combine North Carolina's renowned academic health system with the state's largest hospital chain. It would have about $14 billion in combined annual operating revenue, more than 50 hospitals and more than 90,000 employees.

    The deal will be reviewed by North Carolina's attorney general and potentially the Federal Trade Commission as well as a six-member panel appointed by the University of North Carolina's board of governors.

    Late last month, Blue Cross and Blue Shield of North Carolina, the state's largest health insurer, publicly opposed the proposed merger between Carolinas and UNC, arguing it will drive up prices for patients.

    Payers and providers are often locked in a power struggle amid rampant consolidation as each seek the strength of scale. Each side argues that they are unable to compete on pricing when one or the other can dictate contract negotiations given the expansive market shares.

    An organization that has the scale to build infrastructure and spread the cost over a wide patient base can generate return on investment, particularly in risk-based agreements.

    But provider consolidation will continue to drive up healthcare costs, BCBS contends in this case, backed by a number of studies. Hospitals with fewer than four local competitors are estimated to have prices nearly 16% higher on average—a difference of nearly $2,000 per admission, according to a white paper from the Center for Health Policy at the Brookings Institution and Carnegie Mellon University's Heinz College.

    Carolinas and UNC contend that those assertions don't apply given the uniqueness of their combination, and that there would still be plenty of competition in the state. Executives said the partnership aims to improve healthcare access, particularly for patients in rural and underserved parts of the state.

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