Henry Ford Health System and Beaumont Health System announced Tuesday that after six months of due diligence the two organizations are not going forward with their merger that would have created a $6.4 billion organization.
In separate press releases, executives of the companies said they decided not to merge because it became apparent that the two companies had different perspectives on what the new organization would be.
[See also: Beaumont and Henry Ford announce plans to merge]
“We have benefitted greatly from our merger discussions and have great respect for our colleagues at Henry Ford,” said Gene Michalski, president and CEO, Beaumont Health System in a statement. “However, we found through our discussions that we are not aligned on how to achieve our vision for a model health system due to differences in our structures and business models.”
Nancy Schlichting, Henry Ford’s chief executive officer, noted in her press release that some of the foundational elements of the Letter of Intent, including preserving two academic medical centers, were not supported by some of Beaumont’s leadership, but other than that, neither organization has offered specifics as to what led to the decision to not merge.
The Detroit Free Press reported on Tuesday that a number of Beaumont physicians told the Beaumont board that they opposed the merger.
“They are very different medical cultures between the two organizations. They are very different structurally,” Marianne Udow-Phillips, director of the Ann Arbor-based Center for Healthcare Research and Transformation, told the Detroit Free Press. “Once the physicians at Beaumont said, quite publicly, that they had a lot of concerns about it, that made it clear that it was going to be even harder to make this happen.”
A Beaumont spokesperson told the newspaper that the health system will continue reviewing other potential partners.