Six months into Freese Deckers acquisition of Beaumont Health from former controversial CEO John Fox, metro Detroits biggest hospital system is suffering from a pandemic of red ink. The FTCs approval isnt certain, as President Biden has asked the agency to be more critical of mergers. This columnist, a Los Angeles freelancer, is a former Detroit News business reporter who blogs atStarkman Approved. Instead, thanks to aggressive cost cutting and other misguided decisions by Fox and COO Carolyn Wilson, Beaumont imploded. Various studies, including one published in 2019 by Harvard researchers, also show that hospital mergers result in worsened patient experiences. The list goes on. Copyrightdocument.write(new Date().getFullYear());Deadline Detroit, Inc. - All Rights Reserved. And there is no mention of what, if any, role Beaumont COO Carolyn Wilson will play after the merger. Why isnt Freese Decker following through on that supposedly great initiative? Starkman: Beware! Freed notes that Beaumont claims to have 300 days of cash on hand but doesnt have a top-tier bond rating allowing it to borrow money at the best rates. Several prominent Beaumont doctors warned the board they had serious concerns about the anesthesia outsourcing company before it took over, but Beaumonts board ignored the concerns. In his video, Fox disclosed that none of the monies for the planned expansion are being diverted from funds to deal with Beaumonts chronic staff shortages that have forced the closing of wards because there isnt sufficient medical staff to cover them. The nurse anesthetists at Beaumont Royal Oak, Troy and Grosse Pointe hospitals, who are critical to keeping their facilities' lucrative surgery businesses humming, are mad as hell and aren't going to take it anymore. Even if the executive couldnt restore Beaumont to its former glory, he or she could at least have minimized the damage and fetched a higher price for the hospital network than whatever Fox has negotiated. The once proud and respected hospital system merged with two lesser ones in 2015, paving the way for Fox, who was determined to sell Beaumont from the moment he arrived. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. Reach Eric Starkman at: eric@starkmanapproved.com. They are looking at diversity as a numbers game. Spectrum no doubt knew that Fox was desperate to unload Beaumont, so Freese Decker had him by the cajones. Why would Beaumont nurses want to remain on staff when they can make more money working at a staffing agency? Beaumont CFO John Kerndl Resigns, Beaumont Nurse Anesthetists Union Drive Could Save Imploding Hospital from Further Demise, Layoffs. As a result, patients requiring hospital admission must remain in the ER, diverting beds and staff normally dedicated to treating emergencies. Reach the writer ateric@starkmanapproved.com. What, if any, role Wilson will play after the merger hasnt been disclosed. As Deadline Detroit recently reported, Beaumonts once-bustling endoscopy suite, where a patient died undergoing a routine colonoscopy in January, has suffered a rash of nurse resignations and can barely operate at 50 percent capacity. Nursing shortages are causing havoc at other Beaumont hospitals as well. Virtually all of Fox's senior management team resigned or was . Its a vicious cycle, one that I doubt Spectrum has figured out how to solve. Henry Ford in Detroit in years past enjoyed an A safety rating. Inexperienced nurses Fox disclosed that Beaumont has extensively expanded its use of nurse staffing agencies, which could exacerbate already poor morale among its nurses. April 18, 2020, 3:27 PM . That Fox, who along with Wilson has shown they have no commitment to southeastern Michigan, was allowed to negotiate Beaumonts fate underscores just what an irresponsible disgrace Beaumonts board is. Turns out Beaumonts reported $4 billion reserve also dwindled by the time Fox turned over the keys to Freese Decker. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. Beaumont spent nearly $2 million on union busters when nurses at the Royal Oak hospital attempted to organize in 2019. By Eric Starkman. Lewis previously served on the board of one of Beaumonts predecessor companies and likely didnt want to continue after Beaumont completed its merger. One need only look at Beaumont, an amalgamation of the Beaumont Health System, Royal Oak, Oakwood Healthcare, Dearborn, and Botsford Health Care in Farmington Hills that was created in 2014. Travel nurses are also required to oversee only four patients at a time and are exempted from having to transport patients to other areas of the hospital. Its not unusual for a so-called charge or supervisory ICU nurse to have just one year of experience. Marshall is big news in Michigan these days, as the state has earmarked more than $1 billion in subsidies for Ford Motor Co. to build an electric battery plant on . Spectrums joint release with Beaumont says the aim of the deal is to make health care more affordable for the communities we serve. Heres my challenge to Freese Decker: For every independent study she can come up with showing where hospital mergers resulted in more affordable care, I will come up with two showing the opposite. Studies also show that hospital mergers also result in a decline in patient care. Nurses employed by staffing agencies are paid more than staff nurses performing the same functions. Said a veteran Troy ER source: Ive never seen anything like this in all my years of nursing. The metric that matters most is quality of patient care. According to the most recently available filings, Freese Decker earned $3.9 million in 2018. These contracted doctors also were responsible for setting up a Covid-19 ICU unit at Beaumont Troy. Reach Eric Starkman at: eric@starkmanapproved.com. Share. In a company video posted on Vimeo Thursday, Beaumont CEO John Fox disclosed that Beaumont plans to spend significant dollars to embark on a three to five-year plan to expand the health systems private bed capacity. Freed has vowed he will hold Spectrums directors accountable for the repercussions to his Grand Rapids community. I dont know how we could handle a catastrophe, said a source at Royal Oaks ER. How Absurd. Freese Decker this week toured Beaumont Troy Hospital, and notably neither Fox nor COO Carolyn Wilson were in tow. As often happens when you meld two organizations, the weaker one brings the stronger one down. Much of Freeds letter focuses on why merging with Beaumont is very bad for western Michigan residents, but in doing so he calls out Beaumonts lack of financial transparency and notes that the few disclosures Beaumont makes dont add up. Funny we only now are learning just how badly Fox ran Beaumont into the ground. In its announcement to employees, Beaumont said the merged company will maintain dual headquarters in Southfield and Grand Rapids, an economically inefficient move if true but it likely isnt. Business Starkman: Bloodbath at Beaumont - COO Carolyn Wilson and Top Doctor Ousted; Chief Quality Officer Resigns Tweet Share July 22, 2021, 12:45 PM This columnist, a Los Angeles freelancer,. He's even willing to. Reach Eric Starkman at: eric@starkmanapproved.com. Meet Michael Freed, decidedly among the bravest persons in . Starkman: America's Mistakenly Entitled Restaurant Workers February 08, 2023, 12:24 PM - Starkman Approved 'The Week That Was:' Why Police Have Groups Like the 'Scorpion Unit' February 03,. Allowing them to continue profiting from their mismanagement would undermine Spectrum managements credibility from the get-go. By Eric Starkman. Starkman: Why Beaumont's John Fox Could Haul More Than $30 Million Back to Atlanta Tweet. Its a no-brainer to understand why Fox desperately needs to pull off the Spectrum merger. Beaumont Health CEO John Fox has no shame. The rankings are based on data compiled before Beaumont Royal Oak outsourced its anesthesia services, a controversial move linked to the death of a patient undergoing a routine colonoscopy and another patient landing in the ICU because of a pain medication overdose. In his video, Fox was wearing a pinstripe suit jacket, not his trademark blue blazer. Seven Failed Beaumont Directors Will Serve on Board If Spectrum Merger Gets Approval, Beaumont CEO John Foxs Final FU to Detroit: Merger with Spectrum Health, Beaumont Health Chair John Lewis -- Champion of CEO John Fox -- Stepping Down in June, Beaumont Manager Moved to Sabotage Anesthetists Concerns About Critical Drug Pump Shortage, Beaumonts John Fox Set to Unload Historic Bloomfield Hills Estate, Beaumont Nurse Anesthetists at Royal Oak, Troy and Grosse Pointe Vote Overwhelmingly to Unionize, Beaumont Forces Suspension of Leader of Nurse Anesthetist Union Drive, Starkman: Why Tree Huggers Must Save This Small Town in Michigan From Ford, 'Detroit In Black And White:' Why We Got Kicked Off 910 AM, Randy Wimbley Leaving Fox 2 After a Decade on the Air. Newsweek Ranks 3 Beaumont Hospitals Among Best in U.S. One Down, Three to Go. Freed was CFO of Grand Rapids-based Spectrum Health for nearly 19 years, and later headed the hospital companys lucrative Priority Health insurance arm for six years. ", a month membership or a one-time donation, Beaumont Health's Merger Partner Reveals its Disingenuous, Deceptive and Disrespectful Nature, Spectrum Healths Black Employees Explore Class Action Lawsuit Alleging Systemic Racism, Beware! Ohios AG has won a series, Today is indeed a historic day. I know little about Fream, who served as Beaumonts vice chair for several years. Eric Starkman of Los Angeles is a former Detroit News business reporter who blogs at Starkman Approved. Destroying Beaumont and Spectrum Health, Covid Not Responsible for ER Debacles at Beaumont RO and Troy, Sh** Show at Beaumont Endoscopy Suite in Chaos Amid Nursing Shortage, C-Section Horror at Beaumont Lawsuit Claims Surgeon Left Sponge in Patients Abdomen, Former Spectrum CFO Trashes Beaumont Merger and Warns of 'Massive Financial Loss', Beaumont's Merger Partner Reveals its Disingenuous, Deceptive, Disrespectful Nature, Spectrum Healths Black Employees Explore Class Action Lawsuit Alleging Systemic Racism, Beware! Confidentiality is assured. By Eric Starkman John Fox, the Atlanta carpetbagger who washed up on the shores of southeastern Michigan seven years ago to bolster Beaumont Health's profits and gussy up Metro Detroit's. Fox didnt disclose how much Beaumont will spend to fund its real estate expansion. In a major blow to the hospital, Reza Dabir, Dearborns top cardiothoracic surgeon, resigned to join Ascension Health. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. Fox, who owns homes in Atlanta and North Carolina, cant be bothered to even create the appearance that he cares about Beaumonts future. . One of the deciding factors in evaluating merging Beaumont and Spectrum will be the financial terms of the deal. Beaumont spokesman Mark Geary ignored a request for comment, which he typically does. Spectrum spokeswoman Ellen Bristol Wednesday morning said she would look into whether a merger was imminent, seeming to indicate Deadline Detroits inquiry was the first shed heard of a potential deal. If this is a signal of what to expect if Grand Rapids-based Spectrum Health is allowed to rescue Beaumont Health from further decline, maybe the takeover isnt quite as ill-advised as I thought. Seven Failed Beaumont Directors Will Serve on Board If Spectrum Merger Gets Approval, Beaumont CEO John Foxs Final FU to Detroit: Merger with Spectrum Health, Beaumont Health Chair John Lewis -- Champion of CEO John Fox -- Stepping Down in June, Beaumont Manager Moved to Sabotage Anesthetists Concerns About Critical Drug Pump Shortage, Beaumonts John Fox Set to Unload Historic Bloomfield Hills Estate, Beaumont Nurse Anesthetists at Royal Oak, Troy and Grosse Pointe Vote Overwhelmingly to Unionize, Beaumont Forces Suspension of Leader of Nurse Anesthetist Union Drive, Starkman: Why Tree Huggers Must Save This Small Town in Michigan From Ford, 'Detroit In Black And White:' Why We Got Kicked Off 910 AM, Randy Wimbley Leaving Fox 2 After a Decade on the Air. Spectrum was targeting a $156 million operating profit. Beaumont does not have a good reputation regarding how they treat employees. Merging with Beaumont would more than double Spectrums size in some areas. Starkman: Why Beaumont's John Fox Could Haul More Than $30 Million Back to Atlanta Tweet Share February 02, 2022, 4:58 PM Beaumont CEO John Fox The writer, a Los Angeles freelancer, is a. Beaumonts flagship Royal Oak hospital only garnered a four-star rating and its other hospitals earned two-and three-star ratings. Under the terms of the deal Fox negotiated, Advocate Aurora would have taken over Beaumont and its $2.5 billion reserve without forking out a penny. It comes as no surprise that Spectrums takeover received the green light. The deal will invariably be good for Fox, as he will likely get a very lucrative exit package to sail into the Georgia sunset. At Beaumont's Royal Oak, Troy, and Grosse Pointe hospitals an elite team of more than 70 anesthesiologists trained and experienced with intubation performed all the procedures. Consultants are part of the . Other state attorney generals have also shown a willingness to take on the powerful interests of U.S. hospital companies. Underscoring Beaumonts disregard for transparency, the company routinely waits till the very last day before filing its Form 990, a document nonprofits are required to make public revealing compensation and other critical information. By comparison, BHSH will have 22 hospitals and 64,000 employees. Fox in January also disclosed that Beaumont planned to spend significant dollars to embark on a three to five-year plan to expand the health systems private bed capacity. The terms of the deal were so obscenely favorable to Advocate Aurora that Rep. Andy Levin, whose district includes Beaumont Royal Oak, announced he would oppose the deal. He also noted that Beaumont received Medicare advances of $505 million in 2020 that needs to be returned this year. Most of Foxs senior management team has departed, and hes expected to leave once the takeover is completed and he receives the millions of dollars likely owed to him under his golden parachute agreement. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. Fox owns homes in Atlanta and North Carolina, Wilsons primary home is in Grand Rapids, Jordan, Beaumonts chief counsel, commutes from Atlanta, as does Susan Grant, the companys chief nursing officer. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. It appears that Beaumont Health CEO John Fox won't be bundling his millions and bidding Michigan goodbye as soon as he hoped. After posting his letter, Freed noted on his LinkedIn page that Beaumont made $167 million from its operations in 2020, which included revenue recognition of $349 million from the CARES Act and FEMA payments for Covid. Spectrum, with $6.9 billion in revenues, operates 14 hospitals in the western side of the stateand has 30,000 employees. To support Deadline Detroit's independent. Rather than having people speculate he was passed over, he chose to step down in advance. A source told me that Barbee was highly regarded among Spectrums Black employees but was frustrated by his inability to achieve meaningful change. According to one source, Beaumont at least until recently had more than 3,000 job openings. 'The Week That Was:' Will Kristina Karamo Seriously Damage Michigan's Republican Party? Beaumont CEO Fox and COO Wilson Must Go Now! Multiple sources have shared theyve been told by some Beaumont directors that Fox cant be fired, but no one gave a reason as to why. Working at Beaumont under Fox and his former COO Carolyn Wilson was a hellacious HR experience, and the pandemic worsened the situation. By Eric Starkman John Fox, the Atlanta carpetbagger who washed up on the shores of southeastern Michigan seven years ago to bolster Beaumont Health's profits and gussy up Metro Detroit's. Spectrums board strikes me as pretty buttoned up, so they might not yet appreciate the extent of how damaged Beaumont really is. If (Beaumonts) operating margins are adequate, and they have plenty of cash, whats the problem? Beaumont Troy, the only hospital in the companys network with a 5-star ranking for safety from the Centers of Medicare and Medicaid, doesnt have the management strife of Royal Oak. The Detroit News. To support Deadline Detroit's independent journalism, please sign up for a $3a month membership or a one-time donation. The promised dual headquarters was also BS. Its reasonable to assume the real reason for Freams elevation was the board knew Fox was close to inking a deal with a merger partner. 'The Week That Was:' Will Kristina Karamo Seriously Damage Michigan's Republican Party? A merger of Spectrum and Beaumont must be approved by Michigan Attorney General Dana Nessel, who has shown no interest in championing healthcare issues and can be counted on to rubber stamp the deal. And that has resulted in the emergency rooms of Beaumont Royal Oak and Troy becoming so overwhelmed they are unprepared to handle unexpected catastrophes required of them as regional trauma centers. A Grand Rapids television station revealed that operating room OBGYN doctors were posting photos on social media of them holding up surgically removed organ and tissue material as part of a game they likened to The Price Is Right. The report by NBC affiliate WOODis a classic worth watching because the reporter cant believe what shes actually reporting. Freese Decker is likely assured a big pay increase and bonus. Reach the writer ateric@starkmanapproved.com. Beaumont institutionally has a very tenuous relationship with truth. To support Deadline Detroit's independent. Six months into Freese Decker's acquisition of Beaumont Health from former controversial CEO John Fox, metro Detroit's biggest hospital system is suffering from a pandemic of red ink. Spectrums previous head of diversity was Ovell Barbee, an African American, who Spectrum proudly announced last April was named one of the leading diversity executives in the country. Among the benefits of the deal Fox trumpeted was a $1 billion commitment to move the William Beaumont School of Medicine from Oakland University to Beaumonts flagship Royal Oak campus and a significant increase in technology spending. The writer, a Los Angeles freelancer and formerDetroit News business reporter, blogs atStarkman Approved. Nonprofit hospitals are supposed to manage their investments conservatively, opting for boring short-term duration bonds and other low risk investments. Spectrums due diligence team will be unable to get clarifications on Beaumonts financials from the companys CFO because it doesnt have one. A credible and competent board would have fired Fox, Wilson, and chief medical officer David Wood Jr. after internal surveys last year revealed the majority of Beaumont doctors and nurses had no confidence in them. Said Kevin Cawley, a Michigan health care consultant: The only possible value I could identify (for the merger) was in national and international physician recruitment, and that frankly is a stretch.. Beaumont Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. Beaumont Dearborn also is receiving military assistance to help the hospital manage its Covid patient load. Beaumont is offering all its nurses systemwide an additional $45 to $50 an hour bonus to work beyond their assigned shifts, an additional $15 an hour for techs. There are no bios or photos of Beaumonts other directors, and thats by intent. Carey has spent more than 20 years as a . Despite the pandemic, which has forced Spectrum to call for military assistance to support its flagship hospital, CEO Tina Freese Decker recently disclosed that shes been focused on integrating Spectrum and Beaumont, creating Michigans biggest hospital system as well as the biggest employer. Beaumont, consistent with its practice of putting a spin on undesirable news, notified employees that it is making "good progress" toward . 'The Week That Was:' Will Kristina Karamo Seriously Damage Michigan's Republican Party? Copyrightdocument.write(new Date().getFullYear());Deadline Detroit, Inc. - All Rights Reserved, AG Dana Nessel and Gov. Fox that year was paid $5.9 million. Beaumont Royal Oak in the past 18 months has lost more than a dozen prominent surgeons, half of its fellowship trained anesthesiologists, more than 50 nurse anesthetists, and dozens of nurses. Reach Eric Starkman at: eric@starkmanapproved.com. Although we are facing these current financial headwinds, we are confident we will continue to deliver effectively and successfully on our mission in the communities we serve in Michigan.. So What? Freed is seemingly unaware of how desperate Beaumont CEO John Fox is to find a merger partner and complete the sale before year-end. The head of Beaumonts audit committee was Julie Fream, who earlier this month became the hospital networks chair and has no auditing experience or background listed on her LinkedIn page. The American Hospital Association (AHA), the trade group focused on promoting the financial interests of nonprofit hospitals and their managements, is a major lobbying force in Washington. Spectrum reported that Beaumont's operations already have racked up nearly $100 million in losses. For years, former Beaumont CEO John Fox was paid more than $6 million annually because of his supposedly deft fiscal management. He said the expansion would involve a lot of local planning in terms of where these bed towers are located, which seemingly indicates that Beaumont is planning to expand its real estate footprint. BHSHs management team is comprised entirely of Spectrum executives, except Beaumont Royal Oak president Nancy Susick, who has been named interim president of what is being called BHSH Beaumont Health. The quality of care has declined to such a degree that insiders readily admit they wouldnt entrust their families care to the hospital. That would mean there wouldnt be one senior executive from Beaumont involved in the management of the combined hospital systems. Lewis, the board chair, was replaced earlier this month by Julie Frehm, president and CEO of the Original Equipment Suppliers Association. The writer, a Los Angeles freelancer, is a former Detroit News business reporter who blogs atStarkman Approved. Share. A responsible attorney general would have removed Fox, board chair Julie Fream, and the other Beaumont directors who stood idly by a long time ago. As of this writing, Freeds letter received 40 likes and other shows of support, and not a single criticism. View Comments. According to a source, some travel nurses are being paid lucrative wages to work only three or four shifts a week. June 17, 2021, 9:36 PM . The FTC is headed by Lina Khan, a Democrat appointed by Biden and sworn in last June 15 to a three-year term. Under Freese Deckers leadership, Spectrum experienced considerable turnover of its Black employees, some of whom approached an attorney to explore whether they had cause to file a discrimination lawsuit. But Spectrums management is 100 percent running the show. Eric Starkman of Los Angeles is a former Detroit News business reporter who blogs at Starkman Approved. Beaumont has signed a letter of intent to merge with Spectrum Health, a Grand Rapids-based hospital network focused on Western Michigan, the company announced internally Wednesday. She bolted last month. The situation has become so acute that an ICU patient was recently treated in Troys ER. In addition to lacking a CFO and chief compliance officer, Beaumont has yet to find a replacement for its chief marketing officer, who left last September. Grand Rapids business community is small and tight knit, and Spectrum is a major employer in western Michigan. Still, Beaumont is clearly going to be a financial albatross on Spectrums operations for quite some time. His chief marketing officer resigned last September, his CFO quit in March, his chief compliance officer left a few weeks ago, and his chief revenue officer is out the door in a few days. This columnist, a Los Angeles freelancer, is a former Detroit News business reporter who blogs at Starkman Approved. Beaumont CEO Fox and COO Wilson Must Go Now! Also fostering ill will is Beaumonts mandate requiring that all employees be vaccinated or be fired. Beaumont reported operating revenues of $4.6 billion in 2020 and is only an eight-hospital system. The Detroit Free Press quotedSpectrum's Freese Decker as saying, Today is a historic day. Its one of the rare instances where shes made a statement of undeniable truth. More importantly, I doubt that Spectrums doctors would feel the need to circumvent management in the first place. BHSH is what Spectrum calls its combined Beaumont and Spectrum operations. A lifelong Michigander with an impressive background, Barbee resigned in October to join Indiana University Health as head of HR. That amounts to a Spectrum takeover in my book. The Freep quoted Oakland University dean of nursing Judy Didion as saying it will take about a year to build the infrastructure until the school can begin to admit additional students. When Fox arrived, Beaumont Royal Oak was among the best regional hospitals in the country; today it can best be described as a giant but mediocre community hospital. Prioritys goal is to capture as much market share as possible and then use that power to reduce what it pays to doctors to cover their services. Henry Ford Hospital announced this week that it was closing 120 inpatient beds systemwide due to staffing shortages. If theyre out there, theyre certainly not easy to find and, no, a few quotes about financials every quarter does not count as transparency, at least not in my book.. Yet neither Whitmer or Nessel demanded any diversity or health equity commitments from Spectrum as a condition of its takeover. The release, which Fream presumably signed off on, said her appointment was part of a normal governance leadership rotational process.. Its near impossible to put a positive spin on a critical and passionate letter written by a former top executive who played a major role transforming Spectrum into a western Michigan powerhouse. Also unavailable for clarifications will be Dawn Geisert, Beaumonts former compliance chief. ER sources at Royal Oak and Troy say Covid patients account for a small percentage seeking emergency treatment. Beaumont Health was significantly impacted by these financial and workforce headwinds that were particularly strong in Southeast Michigan (in the second quarter). Reach Eric Starkman at: eric@starkmanapproved.com. Nessels do nothing stance on healthcare matters is in sharp contrast to her Massachusetts counterpart Maura Healey, who has moved to block the expansion of Massachusetts General Brigham on the grounds it will lead to higher health care costs in that state. On Thursday he posted an open letteron his LinkedIn page to Spectrums board implicitly questioning Beaumont Health's financials and warning that merging with the Southfield-based hospital network is ill advised. Beaumont employees and vendors are encouraged to reach out, with confidentiality assured. . Reach Eric Starkman at eric@starkmanapproved.com . Beaumont Health CEO John Fox, the Atlanta carpetbagger who destroyed the companys flagship Royal Oak hospital while pocketing more than $20 million for himself, appears close to pulling off what he set out to do from the moment he arrived in Metro Detroit six years ago: Merging southeastern Michigans biggest hospital network out of existence. The Beaumont Health System, comprised of Royal Oak, Troy, and Grosse Pointe hospitals, was far superior and the expectation was that the merger would elevate the quality of staff and patient care at the Oakwood and Botsford hospitals. 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