Chicago-based CommonSpirit Health will consolidate its five regions into three service areas, West, Central and East, effective in January, CFO Michael Browning said during the system’s fiscal 2026 earnings call Oct. 2.
The change replaces the California, Central, South, Mountain and Northwest regions established after a 2024 portfolio review that consolidated eight operating divisions into five. Each service area president will sit on the system’s enterprise leadership cabinet.
CommonSpirit confirmed in a September statement to Becker’s that it was evolving its operating model “to better leverage our system scale and more effectively support our markets.”
Mr. Browning said the transition is meant to eliminate duplication, management layers and complex legal structures. The system is also consolidating its acute care entities into a single entity per state and has unified its 27 critical access hospitals under a single rural operating model within the East service area.
Central function overhead as a share of operating revenue is targeted to fall from 15.8% in fiscal 2026 to 14.5% in fiscal 2027. A review of management spans of control produced more than $103 million in run-rate reduction.
The redesign is part of Project ImpACT, which the system projects to drive $6 billion in financial improvement over five years. Fiscal 2027 efficiency work targets more than $1 billion from workforce rationalization, clinical standardization, supply chain adherence and purchased services standardization.
CommonSpirit is also in-sourcing its revenue cycle after exiting its contract with Conifer, rebadging more than 1,900 employees. The transition is scheduled to be completed Oct. 30, two months ahead of the contract’s termination date.
The system narrowed its operating loss in fiscal 2026, excluding special charges. It operates about 2,600 care sites in 24 states.
