Saint Joseph Mercy Health System and Michigan Medicine ink joint venture agreement for St. Joseph Mercy Chelsea Hospital

In a joint statement, Saint Joseph Mercy Health System (SJMHS) and Michigan Medicine, the academic medical center of the University of Michigan, announced the they have signed a definitive agreement to establish a master affiliation and a joint venture for the 133-bed St. Joseph Mercy Chelsea Hospital (SJMC), effective immediately.

Feb. 15, following Trinity Health Michigan Board’s previous approval, the University of Michigan Board of Regents approved the master affiliation and joint venture. Their media announcement stated the agreement, “will allow two strong health systems to join forces and enhance care we provide to our communities. Both organizations are committed to providing the right care, at the right time, in the right place through shared clinical objectives and bringing more care options closer to where patients live.”

In March 2017, the two health systems signed a letter of intent to examine the feasibility and structure of the proposed joint venture. Now, the two parties have completed their due diligence period and finalized the terms of the definitive agreement under which SJMHS and Michigan Medicine will both have an interest in St. Joseph Mercy Chelsea. As both the majority and managing partner, SJMHS will provide leadership, nurses and staff and continue to oversee all hospital operations.

“It has been a pleasure working with Michigan Medicine to create a care delivery model that uses both of our existing strengths to benefit patients,” said Rob Casalou, president and CEO, Mercy Health and SJMHS. “Our health systems have a long history of working together and this joint venture is a continuation of our efforts to expand access to health services, including specialized surgery and physicians that were previously only available on Michigan Medicine’s campuses.”

“SJMHS has a long-standing, positive reputation for delivering high quality care, which makes this an excellent partnership for Michigan Medicine,” said David Spahlinger, M.D., president of the University of Michigan Health System, the clinical care enterprise of Michigan Medicine. “With this affiliation, Chelsea-area patients will have expanded care choices closer to home.”

A strategic priority in expanding this statewide network is a greater presence in communities across the state, Spahlinger said, including communities adjacent to Ann Arbor as well as in West Michigan. He added, the “formation of strategic relationships will help us manage the growing need for hospital beds in the University of Michigan hospitals in Ann Arbor.”

The joint venture builds upon the existing Michigan Medicine family medicine residency clinic located on the St. Joseph Mercy Chelsea campus since 1978. The joint venture expands the surgical procedures that Michigan Medicine provides at St. Joseph Mercy Chelsea, as well as increases access to Michigan Medicine physicians for patients in Chelsea and across western Washtenaw County.

Construction will begin shortly on the seventh and eighth operating rooms at St. Joe’s Chelsea. More services and surgical procedures will continue to be explored as the partnership advances.

According to the announcement, all St. Joseph Mercy Chelsea staff will remain SJMHS employees, and no staff reductions will take place as a result of this agreement. Additional colleagues will be recruited as needed to support medical and surgical volumes. All Michigan Medicine employees, including doctors, residents and house officers who may work at Chelsea, will remain employees of the University of Michigan.

St. Joseph Mercy Chelsea will retain its Catholic identity and continue to abide by the Ethical and Religious Directives.

The new agreements are part of a larger statewide strategy among Trinity Health-owned Mercy Health and SJMHS on one hand and Michigan Medicine and its most recent affiliate, Metro Health in Grand Rapids on the other hand.  This statewide strategy also includes a professional services agreement between Mercy Health cardiothoracic surgery and the department of cardiac surgery at Michigan Medicine, clinically integrated network delivery models that serve West Michigan, and graduate medical education.

Nationally recognized for both quality of care and patient satisfaction, St. Joseph Mercy Chelsea employs more than 1,200 individuals with a medical staff of approximately 500 physicians. Key services include robust medical and surgical service lines, six operating rooms, a 24-hour emergency department and senior emergency room, state-of-the-art cancer center with TrueBeam™ linear accelerator, physical medicine and rehabilitation department, a comprehensive head pain treatment unit and behavioral health services. Founded in 1970, the hospital joined SJMHS in 2009 as a way to strengthen patient care by becoming part of a large health care system.