It was a busy year for health system transactions, as organizations — 18 in the third quarter alone — joined forces to weather financial challenges.
Here are five mergers and acquisitions that made headlines in 2023, listed in reverse chronological order:
1. BJC, Saint Luke's finalize merger: St. Louis-based BJC Healthcare and Kansas City, Mo.-based Saint Luke's Health System have satisfied all regulatory reviews and reached a definitive agreement to merge. The deal, announced in May and finalized in November, will create a 28-hospital health system worth $10 billion.
In a June interview with Becker's, both systems' CEOs explained they would retain their individual brands and headquarters, operating from an Eastern region — the BJC side out of St. Louis — and a Western region — the Saint Luke's side out of Kansas City. Both organizations are financially stable, making this a "forward-looking transaction," the CEOs said.
2. Ascension Michigan, Henry Ford Health begin joint venture: The two Detroit-based health systems announced a joint venture on Oct. 18. Under the agreement — which has been submitted to state and federal regulatory agencies for review — Henry Ford would fold Ascension's sites of care in the Southeastern region of the state under its brand. Ten Ascension hospitals would be included in the partnership, along with all five of Henry Ford's acute care hospitals and other care facilities and assets.
Henry Ford President and CEO Bob Riney will lead the combined enterprise, and the board of directors will represent both organizations. The JV organization will employ approximately 50,000 team members, include more than 550 sites of care and is expected to close in summer 2024.
3. Centura folds into CommonSpirit: Over the summer, Centennial, Colo.-based Centura Health was absorbed by Chicago-based CommonSpirit Health. CommonSpirit is now managing 20 hospitals and more than 240 sites of care in Colorado, Kansas and Utah that were previously managed by Centura, and plans to retire the Centura brand.
The news followed an earlier announcement that CommonSpirit and Altamonte Springs, Fla.-based AdventHealth would end their Centura Health joint venture after 27 years, with each health system directly managing their respective care sites in Colorado and Kansas. The systems noted the partnership had "reached its natural maturity." Now, AdventHealth is operating, managing and rebranding five hospitals that were part of the Centura Health system.
4. CHS sells hospitals: Franklin, Tenn.-based Community Health Systems sold seven hospitals this year. Three Florida-based, Bravera Health-branded facilities went to Tampa (Fla.) General Hospital for a cash consideration of about $290 million, and Winston-Salem, N.C.-based Novant Health signed a definitive agreement to acquire two North Carolina hospitals for a cash consideration of approximately $320 million. One hospital in Arkansas and one in West Virginia were also offloaded.
In total, CHS has shed 30 hospitals since 2020.
5. Kaiser Permanente acquires Geisinger to launch Risant Health: In April, Oakland, Calif.-based Kaiser Permanente agreed to acquire Danville, Pa.-based Geisinger Health. The deal is subject to regulatory approval, but if it clears, Geisinger will become the first health system to join Risant Health: a new nonprofit organization created by the Kaiser Foundation Hospitals and based in Washington, D.C. Kaiser Permanente is expected to provide about $5 billion in funding for Risant, which aims to acquire four or five more health systems and achieve a total revenue of $30 billion to $35 billion over the next five years.
Geisinger CEO Jaewon Ryu, MD, said the health system will remain in local control if the transaction is approved. Then, he will become CEO of Risant Health, and Geisinger will select a new CEO when he transitions out of the role.