Allegiance Health and Henry Ford Health System have scheduled a joint press conference for Tuesday, April 5th on the campus of Allegiance Health. Leaders and board members from both health systems will meet with the media in the Anderson Building auditorium, to be followed by an unveiling (presumably a new name and signage) in front of the main hospital building. Allegiance joined the Henry Ford Health System on April 1, becoming the 6th hospital in what becomes a $5.2 billion (by revenue) health care system.
Complete financial details of the merger have not been announced, but officials have confirmed no actual cash is being exchanged. In various conversations with news media, officials have said Henry Ford will be making a significant investment into capital projects and clinical service improvements in the Jackson health system.
Among the reasons cited for the merger, Henry Ford will be able to grow outside of Southeast Michigan and bring new health services to the Jackson community. For Allegiance, by partnering with a larger health system, the investment in facilities, equipment and technology will provide growth opportunities.
Henry Ford has its own insurance company, Health Alliance Plan (HAP). Allegiance President and CEO Georgia Fojtasek told JTV that not having an insurance company was a primary reason for seeking a partner. With an insurance company, Allegiance would be able to finance changes in healthcare delivery, such as new services that promote health and are not limited to treating those who are sick, she said.
Allegiance has not had its own insurance company since it closed its Physicians Health Plan of South Michigan nearly ten years ago. Since then, Allegiance has had an exclusivity arrangement with Priority Health, which also provide insurance coverage for the hospital’s employees.
Fojtasek said the successful implementation of an electronic medical record system by Henry Ford was a factor in choosing Henry Ford as partner. Allegiance put its implementation of a medical records system on hold while it sought a partner.
Allegiance signed a letter of intent in December, 2013 to explore an acquisition or other arrangement with University of Michigan Health System. A year later, the exclusivity letter expired without an agreement. In November, 2015 Allegiance announced an agreement was reached to join the Henry Ford Health System. Both boards approved the final agreements to merge in mid-March, taking effect on April 1, 2016.
Allegiance Health was founded in 1918 as W.A. Foote Memorial Hospital. The health system adopted the Allegiance name in 2008, while retaining the Foote name for the main hospital building. With a new name still under wraps, a hint may be gained by the names of Henry Ford’s other hospitals: Henry Ford Macomb Hospital, Henry Ford Wyandotte Hospital, Henry Ford West Bloomfield Hospital and Henry Ford Kingswood Hospital.