Ascension St. John Hospital is on the east side of Detroit, and is among the eight hospitals that will be rebranded to Henry Ford Health as a part of a new joint venture.
A joint venture between Henry Ford Health and Ascension Michigan will launch on Oct. 1, a spokesperson for Henry Ford Health confirmed to Crain’s.
Under the no-cash deal, eight Ascension and Genesys hospitals and an addiction treatment center will be rebranded under Henry Ford Health.
Related: Henry Ford Health, Ascension Michigan to combine in $10.5 billion system
The hospitals that will be operated by Henry Ford Health include its existing holdings, plus Ascension Brighton Center for Recovery, Ascension St. John Hospital, Ascension River District Hospital, Ascension Genesys Hospital, Ascension Macomb-Oakland Hospital-Madison Heights, Ascension Macomb-Oakland Hospital-Warren, Ascension Providence Hospital-Novi, Ascension Providence Hospital-Southfield and Ascension Providence Rochester Hospital.
The combined entity would employ 50,000 workers at more than 550 sites across the state, and effectively doubles the size of Henry Ford Health. Henry Ford Health is growing its acute care hospitals from five to 14, surpassing Corewell East's (formerly Beaumont) footprint in the region of eight hospitals. Henry Ford Health also operates a hospital outside the region, in Jackson.
Despite Henry Ford controlling Ascension's assets, the health system claims it's not an acquisition.
The deal was announced in October 2023 and was awaiting regulatory approval amid a delay after St. Louis-based Ascension faced a systemwide cyberattack in May that shut down its electronic medical records systems for weeks.
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Henry Ford Health CEO Bob Riney will serve as the CEO of the new entity.
The launch next month nearly ends Ascension’s branded presence in Michigan.
The Catholic healthcare system reported a $3 billion operating loss during its fiscal year in 2023 and most recently reported a net loss of $238 million during the second quarter of this year and has been working to sell off assets to stem its bleeding.
Last month, Midland-based MyMichigan Health completed the acquisition of Ascension Health’s three mid- and northern-Michigan hospitals — Ascension St. Mary’s of Saginaw, a 268-bed acute care inpatient facility; Ascension St. Joseph in Tawas, a 47-bed acute inpatient facility, and Ascension St. Mary’s of Standish, a 25-bed critical access hospital and 29-bed skilled nursing facility.
Ascension now only operates four hospitals the state — all in Southwest Michigan. It’s unclear whether Ascension plans to divest those hospitals as well.
The health system has also divested from several other markets as well, including Alabama and regions in Illinois, the Northeast and West.
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Ascension’s exit from Michigan and elsewhere shows how academic-based systems are dominating in the high-stakes investments now required to compete in the healthcare arena, leaving many Catholic-based systems like Ascension in the lurch.
Ascension President Eduardo Conrado, who joined the health system as chief digital officer in 2018, told Modern Healthcare earlier this month that reducing the system's footprint will allow it to invest more in the remaining markets.
“When we looked at our footprint, we felt that it was too big,” Conrado said. “We were in too many states, and in order for us to do the mission well — to continue to improve quality and safety, engagement, experience and operational rigor — it ultimately requires capital deployment back into the sites of care. When you have too many sites of care, you only have so much capital to deploy.”
Henry Ford Health, however, is taking the opposite approach and is expanding at a rapid pace.
The Detroit-based system plans to break ground this fall on a new hospital tower anchoring a $3 billion campus expansion in the city.
It already broke ground on a $400 million joint research building with Michigan State University, which will include the Nick Gilbert Neurofibromatosis Research Institute.
All in, Henry Ford Health plans to spend $4.9 billion over the next decade to fund its expansion efforts throughout Southeast Michigan.
This story first appeared in Crain's Detroit Business.
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