Four Michigan hospitals poised to get new ownership

The Beacon Health System is on the cusp of getting bigger.

Beacon Health System, based in South Bend, Indiana, has reached a definitive agreement with Ascension to acquire four hospitals in southwest Michigan. The deal includes Ascension Borgess in Kalamazoo, a 422-bed hospital.

Beacon, based in South Bend, Indiana, has reached a definitive agreement with Ascension to acquire four hospitals in southwest Michigan. Beacon will also acquire 35 outpatient clinics and an ambulatory surgery center in the deal.

The organizations announced the agreement Thursday and they say they hope to complete the deal in the summer. Regulators must sign off on the transaction.

While Beacon is based in northern Indiana, its market stretches into southwest Michigan, and the system will expand its presence in the market with the deal. Beacon operates seven hospitals with a total of 787 beds, and 146 helathcare sites. Assuming regulators sign off on the deal, the system will have 11 hospitals in its footprint.

Ascension, one of the largest nonprofit hospital systems in America, has been shedding some facilities in recent years.

Kreg Gruber, chief executive officer of Beacon Health System, said the deal to acquire the Ascension facilities marks a significant step for the organization.

“Expanding our reach deeper into southwest Michigan broadens access to high-quality, affordable care for communities served by Ascension, extends our service area and provides growth opportunity to further strengthen the health system,” Gruber said in a statement. “This acquisition will create a bright future for these communities by ensuring access to quality healthcare services for generations.”

With the deal, Beacon Health acquires Ascension Borgess in Kalamazoo, a 422-bed acute care hospital. The other three hospitals are Ascension Borgess Allegan Hospital, a critical access hospital with 25 beds; Ascension Borgess-Lee Hospital, which has 25 beds; and Ascension Borgess-Pipp Hospital, with 43 beds. The four hospitals have 2,700 employees, including 261 providers.

Scott Cihak, chief operating officer of Ascension Michigan, said he’s confident that Beacon will provide top-notch care.

“As a regional provider, Beacon Health System is positioned to serve patients through an integrated care delivery system to ensure that southwest Michigan has access to sustainable, quality health care long into the future,” Cihak said in a statement. “After an in-depth review, we found that our organizations are well-aligned culturally, which will streamline the integration process. Our communities are in good hands.”

For Ascension, the deal is the latest move to divest some of its hospitals, including a host of facilities in the midwest.

Just last month, Prime Healthcare completed the acquisition of eight Ascension hospitals in the Chicago area. Prime also acquired four senior living and post-acute facilities, two ambulatory surgery centers and a host of physician practices.

Ascension sold three Michigan hospitals to MyMichigan Health, completing that deal in August 2024.

Ascension Michigan joined with Henry Ford Health last fall to form a $10.5 billion system in a joint venture. Ascension’s hospitals in southeast Michigan and its Genesys facilities joined forces with Henry Ford, and the organization is under the brand of Henry Ford Health. Officials stressed the joint venture of Henry Ford Health and Ascension Michigan is not a merger or acquisition, and no money changed hands between the organizations.

Ascension, a Catholic system based in St. Louis, owns 105 hospitals and has an ownership interest in 26 other hospitals. Ascension also owns 34 senior living facilities.

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