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October 11, 2022 09:59 AM

Beaumont-Spectrum merger finally has new name

Crain's Detroit Business
Dustin Walsh
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    Beaumont Spectrum-Main_i.jpeg
    New hospital names
    • Corewell Health Beaumont Grosse Pointe Hospital (formerly Beaumont Hospital Grosse Pointe)
    • Corewell Health Beaumont Troy Hospital (formerly Beaumont Hospital Troy)
    • Corewell Health Big Rapids Hospital (formerly Spectrum Health Big Rapids Hospital)
    • Corewell Health Blodgett Hospital (formerly Spectrum Health Blodgett Hospital)
    • Corewell Health Butterworth Hospital (formerly Spectrum Health Butterworth Hospital)
    • Corewell Health Dearborn Hospital (formerly Beaumont Hospital Dearborn)
    • Corewell Health Farmington Hills Hospital (formerly Beaumont Hospital Farmington Hills)
    • Corewell Health Gerber Hospital (formerly Spectrum Health Gerber Memorial Hospital)
    • Corewell Health Greenville Hospital (formerly Spectrum Health United Hospital)
    • Corewell Health Helen DeVos Children’s Hospital (formerly Spectrum Health Helen DeVos Children’s Hospital)
    • Corewell Health Kelsey Hospital (formerly Spectrum Health Kelsey Hospital)
    • Corewell Health Lakeland Hospital (formerly Spectrum Health Lakeland Medical Center)
    • Corewell Health Ludington Hospital (formerly Spectrum Health Ludington Hospital)
    • Corewell Health Niles Hospital (formerly Spectrum Health Lakeland Niles Hospital)
    • Corewell Health Pennock Hospital (formerly Spectrum Health Pennock)
    • Corewell Health Reed City Hospital (formerly Spectrum Health Reed City Hospital)
    • Corewell Health Taylor Hospital (formerly Beaumont Hospital Taylor)
    • Corewell Health Trenton Hospital (formerly Beaumont Hospital Trenton)
    • Corewell Health Watervliet Hospital (formerly Spectrum Health Lakeland Watervliet Hospital)
    • Corewell Health Wayne Hospital (formerly Beaumont Hospital Wayne)
    • Corewell Health William Beaumont University Hospital (formerly Beaumont Hospital Royal Oak)
    • Corewell Health Zeeland Hospital (Spectrum Health Zeeland Community Hospital)

    Michigan's largest in-state health system finally has a permanent name: Corewell Health.

    The announcement comes more than 8 months after the merger of Spectrum Health and Beaumont Health. The two systems merged on Feb. 1 after announcing the intent to merge more than a year ago. The two entities previously operated under the BHSH parent company while maintaining the Spectrum and Beaumont names on hospitals.

    The nonprofit operates a $12 billion, 22-hospital health system with its own health insurer in Priority Health and roughly 60,000 employees.

    The new name will be reflected across all of the hospital names, the system said in a press release on its new site, corewellhealth.org.

    The system plans to phase in the new name signage over the next two years and the name reflects a "a future where health is simple, affordable, equitable and exceptional," the company said in a release.

    "At our core, we are here to help people be well so they can live their healthiest life possible," Tina Freese Decker, president and CEO of Corewell Health, said in a press release. "We recognize the amazing outcomes and history from Beaumont Health and Spectrum Health. Now together, known as Corewell Health, we move forward unified, focused on health and wellness for all. The name selection is especially inspiring as it was influenced by thousands of ideas from our team members who put health and wellness at the core of everything we do."

    Alex Calderone, managing director of Calderone Advisory Group, which consults in the healthcare space, said the name change is underwhelming but unlikely to make a material impact.

    "I don't think it's particularly catchy and I'm sure both sides of the state will mourn the elimination of the legacy branding," Calderone told Crain's. "With that said, this is simply a name change and isn't likely to meaningfully impact operations or demand or care."

    The Spectrum name is being eliminated entirely, but the new signage will retain the Beaumont name on some of the locations.

    Tina Freese-Decker, president and CEO of Corewell, told Crain’s they maintained the legacy Beaumont name on some hospitals because of the name’s recognition and importance in those communities.

    “It’s important we recognize the rich history of all of our organizations,” Freese-Decker said. “We went to our board and internal teams and asked them how would they would like to be referred. We thought it important to honor the legacy names, Blodgett and William Beaumont.”

    Freese-Decker said the name change will remain internal for 2022 and the signage will begin to change in 2023 along with a more robust marketing campaign. 

    The system hired San Francisco-based brand strategy firm Prophet to come up with the Corewell name and logo. 

    Freese-Decker said the name change will aid in the integration process as the entire 22-hospital system is now under one brand.

    “It’s really exciting to have one name to call ourselves,” Freese-Decker said. “It’s a name that’s much better than the previous BHSH name. Having this Corewell name, we can talk about ourselves and what we’re doing collectively — our core values and what we’re trying to accomplish. Also, it helps with further fostering and advancing our culture.”

    The name change comes on the heels of financial struggles from the Beaumont side of the company. Between Feb. 1 and June 30, Beaumont lost $96.3 million, or a negative 5 percent margin, well below the $20.2 million operating margin projected by the organization, according to the first consolidated financial statement published by the merged system.

    Beaumont's metrics plummeted following COVID-19 surges throughout the pandemic. Its admissions rate, patient days (the billable days patients are in beds) and per-patient revenue all dropped after the merger, compared to the same time frame before the merger.

    The system attributed much of the losses to labor costs, which are higher in Southeast Michigan due to far more competition than the west side of the state.

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    Beaumont, and its eight hospitals, had higher expenses than Spectrum's 11 West Michigan hospitals. Between Feb. 1 and June 30, Beaumont spent $1.21 billion on wages and benefits, compared to $980 million for Spectrum West Michigan during the first six months of the year.

    But Beaumont's losses were offset by the strong financial performance of BHSH's Southwest Michigan operations and its integrated insurance arm Priority Health. Spectrum Southwest Michigan reported an operating income of $139.7 million on revenue of $1.92 billion and Priority reported income of $91.4 million on revenue of $3.11 billion during the first six months of the year, respectively.

    As a result, then-BHSH announced last month it would cut 400 positions as part of a cost-reduction plan alluded to in the consolidated financial report.

    This story first appeared in our sister publication, Crain's Detroit Business.

    Related Articles
    Beaumont promotes internally for leadership roles as others depart following merger
    Beaumont-Spectrum merger becomes official Tuesday, making it Michigan's largest employer
    Beaumont, Spectrum health systems say merger delayed by overburdened regulators
    Beaumont, Spectrum sign formal integration agreement with more details
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        • - Hospital of the Future
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        • - Hospital of the Future (Fall)
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