Atrium Joins Advocate Aurora in Hospital Mega-Merger Deal
The two health systems have finalized a $27B hospital mega-merger, creating the fifth-largest nonprofit integrated health system in the nation.
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By - Atrium Health and Advocate Aurora Health have finalized a hospital mega-merger, creating a 67-hospital system across parts of the South and Midwest.
Charlotte, North Carolina-based Atrium announced on its website late last week that the combined health system is called Advocate Health and is currently the fifth-largest non-profit integrated health system in the US. The health system and Advocate Aurora, which operates in Illinois and Wisconsin, unveiled plans to merge in May.
The new integrated health system will generate revenue of over $27 billion while operating more than 1,000 sites of care other than its hospitals. The system expects to treat nearly 6 million patients each year across Alabama, Georgia, Illinois, North Carolina, South Carolina, and Wisconsin.
“Powered by 150,000 teammates – including the best and brightest physicians, nurses, researchers and faculty – we are poised to push past traditional geographic and care delivery boundaries to create a healthier tomorrow for all,” Eugene A. Woods, the newly-instated CEO of Advocate health, said in the announcement on Friday.
Jim Skogsbergh, the president and CEO of Advocate Aurora, will serve alongside Woods as CEO until his retirement in 18 months. Advocate Health also has an equal number of members from Advocate Aurora and Atrium Health on its board of directors.
“We couldn’t be more pleased to bring our organizations together to do more, be better and go faster to help more people live well while training the next generation of [healthcare] professionals,” said Skogsbergh.
Advocate Health will be headquartered in Charlotte while continuing to serve the Chicago and Milwaukee regions, including a planned Milwaukee-based institute for health equity. The health system aims to drive “meaningful social impact,” including becoming carbon neutral by 2030. In the May announcement, the system said it would pledge $2 billion to achieve this goal, advance health equity across its rural and urban underserved communities, and create over 20,000 new jobs.
Atrium’s announcement about the hospital mega-merger comes one day after North Carolina Attorney General Josh Stein said in a press release that there was no legal basis within his office’s statutory authority to block the transaction. However, Stein expressed concerns over the massive deal’s potential impact on healthcare access in rural and urban underserved communities.
“Atrium has estimated that it will invest $25-50 million in the coming years to expand services in underserved communities in North Carolina; given the size and strength of this new combined entity, it is my strong belief that it can and should do more,” Stein stated.
Industry leaders have kept a close eye on the Atrium-Advocate Aurora mega-merger. The federal government has been closing in on hospital mergers and acquisitions to prevent higher healthcare costs for consumers. However, the Federal Trade Commission said it was hit with a surge in merger filings last year and would not meet its deadlines to review each deal.
What the new Advocate Health does not have is geographic overlap, which has prompted federal and state inquiries in the past.
