Advocate Health investment office

KYCO: Know Your Company

Reveal Profile

4 November 2025

1) Overview of the Company

Advocate Health is a nonprofit integrated health system headquartered in Charlotte, North Carolina, formed in December 2022 through the combination of Advocate Aurora Health and Atrium Health. The organization represents the third-largest nonprofit integrated health system in the United States, serving nearly 6 million patients annually across Alabama, Georgia, Illinois, North Carolina, South Carolina, and Wisconsin.

The health system operates under three distinct regional brands: Advocate Health Care in Illinois, Atrium Health in the Carolinas, Georgia and Alabama, and Aurora Health Care in Wisconsin. With Wake Forest University School of Medicine serving as its academic core, Advocate Health employs over 155,000 teammates across 69 hospitals and more than 1,000 care locations. The organization offers one of the nation’s largest graduate medical education programs with over 2,000 residents and fellows across more than 200 programs.

Advocate Health is nationally recognized for clinical excellence in cardiology, neurosciences, oncology, pediatrics, and rehabilitation, as well as specialized programs in organ transplants, burn treatments, and musculoskeletal care. The system operates with an annual revenue of $31.7 billion and maintains strong financial performance with operating income of $824.4 million for the first half of 2025. As a faith-based organization, Advocate Health is committed to providing equitable care for all communities, delivering over $6 billion annually in community benefits.

Eugene A. Woods serves as Chief Executive Officer, leading the organization’s strategic vision to redefine healthcare delivery through its “Rewire 2030” framework. The system’s governance structure includes co-CEO leadership during the initial integration period, with Jim Skogsbergh serving alongside Woods until his planned retirement. The organization maintains strong credit ratings with Moody’s assigning Aa3 ratings to its primary entities and upgrading Wake Forest Baptist to A1, reflecting the system’s financial strength and market position.

2) History

Advocate Health traces its origins to a series of strategic mergers spanning over a century, ultimately culminating in the formation of the current organization on December 2, 2022. The foundational elements of the organization emerged from two faith-based healthcare traditions that began in the late 19th and early 20th centuries.

The earliest organizational roots trace back to 1897 when Norwegian Lutheran congregations in Chicago’s Humboldt Park neighborhood established what would become Lutheran General Health System, originally known as the Norwegian Lutheran Deaconess. Concurrently, the Evangelical Health Systems Corporation was founded in 1906 by the Evangelical Synod of North America to operate the German Evangelical Deaconess Hospital in Chicago.

The Lutheran General Health System experienced its greatest period of growth beginning in 1959 when Lutheran General Hospital opened in Park Ridge, Illinois. At the same time, the Lutheran Institute of Human Ecology was established to develop ministries in alcoholism and substance abuse, senior services, parish nursing, bio-ethics and medical education. Meanwhile, the Evangelical Health Systems underwent significant denominational changes when the Evangelical Synod and the Reformed Church in the United States merged in 1934 to form the Evangelical and Reformed Church. This union was followed by another merger on June 25, 1957, when the Evangelical and Reformed Church combined with the Congregational Christian Churches to form the United Church of Christ, with the health care organization becoming a UCC affiliate.

The modern Advocate Health Care was created in January 1995 through the merger of Evangelical Health Systems Corporation and Lutheran General Health System, bringing together two faith-based, values-driven organizations with complementary strengths and shared mission-oriented histories. Following this consolidation, the system continued expanding through strategic acquisitions, adding South Suburban Hospital, Illinois Masonic Medical Center, Condell Medical Center, and Advocate Dreyer to create one of the largest health care providers in metropolitan Chicago.

A significant expansion occurred on April 1, 2018, when Advocate Health Care merged with Aurora Health Care of Wisconsin to form Advocate Aurora Health, creating the 10th largest not-for-profit integrated health care system in the United States with 27 hospitals, more than 500 sites of care, and combined annual revenues of approximately $11 billion. The merger built upon a 20-year relationship the two health systems had maintained through joint ownership and operation of ACL Laboratories.

The final transformation occurred on December 2, 2022, when Advocate Aurora Health merged with Atrium Health to create Advocate Health, establishing the third-largest nonprofit integrated health system in the United States. The combined organization operates 69 hospitals across six states with annual revenues exceeding $27 billion, serving nearly 6 million patients annually. This merger represented a cross-market consolidation that successfully navigated federal regulatory review without antitrust challenge, marking a significant milestone in healthcare industry consolidation patterns.

Throughout its evolution, the organization has maintained its faith-based foundation while adapting to changing healthcare delivery models and expanding its geographic footprint through strategic partnerships and mergers. The system has faced notable challenges, including a significant cybersecurity incident in 2013 that resulted in a $5.55 million HIPAA settlement with federal regulators, representing one of the largest healthcare data breach penalties in history at the time. Leadership transitions have also marked the organization’s recent history, including the resignation of Chief Financial Officer Anthony C. DeFurio in August 2023, with Bradley A. Clark serving as interim chief financial officer.

3) Key Executives

Eugene A. Woods serves as Chief Executive Officer of Advocate Health, bringing more than 30 years of healthcare leadership experience to the nation’s third-largest nonprofit integrated health system. Woods previously served as president and CEO of Atrium Health from 2016 to 2022, steering the organization through the COVID-19 pandemic while earning national recognition for clinical quality and inclusion on multiple Forbes “Best Employers” lists. He has been recognized nine times on Modern Healthcare’s “100 Most Influential People in Healthcare,” achieving Luminary status for his career-defining work in reshaping the industry, and received the National Center for Healthcare Leadership’s Gail L. Warden Leadership Excellence Award in 2022. Woods holds bachelor’s, MBA, and MHA degrees from Pennsylvania State University and serves on the boards of Johnson & Johnson and Johnson C. Smith University.

Jim Skogsbergh serves alongside Woods as co-CEO until his planned retirement in mid-2024, having previously served as president and CEO of Advocate Aurora Health since the 2018 merger of Advocate Health Care and Aurora Health Care. Skogsbergh joined Advocate Health Care in 2001 as chief operating officer and was promoted to president and CEO in 2002, leading the organization for over two decades. He has been named one of the 100 Most Influential People in Healthcare by Modern Healthcare for eight consecutive years beginning in 2011 and received the American Hospital Association’s highest award, the “Distinguished Service Award,” in 2023. A graduate of Iowa State University and the University of Iowa, Skogsbergh is a past chair of the American Hospital Association board and serves on the World Business Chicago board of directors.

Brad Clark serves as Executive Vice President and Chief Financial Officer, effective December 1, 2023, overseeing revenue cycle management, financial planning, supply chain management, financial reporting, accounting, treasury and managed health resources. Clark was named interim CFO in August 2023 and previously led Advocate Health’s treasury and financial planning analytics division, bringing more than two decades of experience in comprehensive healthcare financial management. A financial leader at Advocate Health and predecessor organizations for more than 13 years, Clark previously served as senior vice president of financial planning and treasurer of Atrium Health and executive vice president and CFO of Atrium Health Wake Forest Baptist. He received a bachelor’s degree in finance from Appalachian State University and an MBA from Wake Forest University.

Bobbie Byrne serves as Executive Vice President and Chief Information Officer, bringing nearly 30 years of experience in healthcare and technology to her role leading the organization’s information systems and digital strategy. Before joining Advocate Aurora Health in 2017, she served in leadership roles at Edward Elmhurst Health, most recently as Chief Medical Officer and previously as Chief Information Officer. A physician board-certified in pediatrics and clinical informatics, Byrne began her career practicing pediatrics in both academic and community-based settings and remains active in the American Academy of Pediatrics and healthcare technology groups. She serves on the boards of Truveta, a health data platform, and Spok, a secure texting application for healthcare organizations.

Nakesha Lopez serves as Executive Vice President and Chief People & Culture Officer, effective March 18, 2024, responsible for strategic management and delivery of all people programs, policies, processes and practices for Advocate Health. Lopez brings more than 20 years of experience building and transforming the human resources function in healthcare and financial services, most recently serving as Chief Human Resources Officer for Baylor Scott & White where she provided strategic oversight of human capital planning, talent management, total rewards, and diversity, equity and inclusion strategies. She previously served as vice president of human resources for Barclays Capital after joining the organization from Lehman Brothers during their acquisition. Lopez received her bachelor’s degree in sociology from Hunter College and a master’s degree in business administration in human resource management from the University of Phoenix.

Bill Santulli serves as President of Advocate Health – Midwest Region, bringing over 35 years of healthcare provider experience across multiple markets to his leadership of operations in Illinois and Wisconsin. Since 2003, he has served as Chief Operating Officer of Advocate Aurora Health and predecessor organizations, having previously held executive roles with New England Medical Center in Boston, Iowa Health System in Des Moines, UniHealth America in Los Angeles, and Good Samaritan Hospital in Puyallup, Washington. Santulli was recognized as one of Modern Healthcare’s 2018 Top 25 COOs for his leadership in healthcare’s complex business environment while delivering results in quality, safety and efficiency. He holds a master’s degree in healthcare administration from the University of Minnesota, a master’s degree in sociology/health services research from the University of Florida, and a bachelor’s degree in sociology from the University of Notre Dame.

Steve Smoot serves as North Carolina and Georgia Division President, effective June 2, 2025, driving strategic priorities, operational excellence, and community engagement across the southeastern regions in alignment with enterprise objectives. Smoot brings more than 25 years of healthcare leadership experience, having most recently served as Chief Operating Officer for SSM Health, which operates 23 hospitals and more than 300 physician offices, where he oversaw hospital, medical group and business operations across Illinois, Missouri, Oklahoma and Wisconsin. Prior to joining SSM Health, he served as Associate Chief Operating Officer at Intermountain Healthcare where he oversaw 23 hospitals, including a Level 1 Trauma Center and Children’s Hospital. Smoot has a bachelor’s degree in hospital administration from Weber State University and a Master of Business Administration from Brigham Young University, and is a fellow of the American College of Healthcare Executives.

Michelle Bergholz Frazier serves as Chief Compliance and Privacy Officer, bringing extensive experience in developing proactive, risk-intelligent methods of mitigating risk in the hospital and healthcare industry. She previously served as Senior Vice President and Chief Compliance Officer for Advocate Aurora Health from May 2018 to February 2023, and Senior Vice President and Chief Compliance Officer for Aurora Health Care from February 2014 to May 2018. Frazier holds a J.D. cum laude from the University of Minnesota Law School and is certified by HCCA and SCCE in Healthcare Compliance. She serves as an Adjunct Professor of Healthcare Compliance at the University of Wisconsin-Milwaukee and teaches Health Care Fraud and Abuse at Marquette University Law School.

4) Ownership

Advocate Health operates as a nonprofit corporation structured through a Joint Operating Agreement (JOA) that was executed on December 2, 2022, creating a unified entity while maintaining the separate legal existence of its constituent organizations. The organization was formed through the combination of Advocate Aurora Health, Inc., a Delaware nonprofit nonstock corporation, and Atrium Health, Inc., a North Carolina nonprofit corporation, with both entities serving as the two corporate members of Advocate Health, Inc., the parent Delaware nonprofit nonstock corporation.

Under the JOA structure, no assets were transferred between the organizations as part of the combination, and neither entity assumed liability for or guaranteed the other organization’s debt. This arrangement allows the system to operate with unified management and governance while preserving the existing debt structures and legal obligations of each member organization. The Advocate Aurora Health Credit Group operates under a Second Amended and Restated Trust Indenture dated August 1, 2018, with U.S. Bank Trust Company, National Association, serving as Master Trustee, while the Atrium Health entities maintain their separate obligated group structures.

Governance of Advocate Health is structured through a board of directors comprising an equal number of representatives from the legacy Advocate Aurora Health and Atrium Health organizations. The board has been reduced from its initial 20 members to 14 members to enhance effectiveness and create capacity for future expansion through system growth. Thomas C. Nelson, former chair of Atrium Health’s board of directors, served as the initial chair of the Advocate Health board until December 31, 2023, when Michele Richardson, former chair of Advocate Aurora’s board of directors, assumed leadership for a two-year term. Wake Forest Baptist maintains two board seats through the same appointments structure that existed at the Atrium Health level.

The organization maintains a complex ownership structure across its various divisions and subsidiaries. Advocate Aurora Health, Inc. serves as the sole corporate member of both Advocate Health Care Network, an Illinois not-for-profit corporation, and Aurora Health Care, Inc., a Wisconsin nonstock not-for-profit corporation. The Charlotte-Mecklenburg Hospital Authority, which does business as Atrium Health, operates as a governmental entity under North Carolina law, while Wake Forest Baptist Health operates as part of the AHI Enterprise governed by Atrium Health, Inc.

Advocate Health’s investment activities are conducted through Advocate Aurora Enterprises, a subsidiary that functions as the organization’s venture capital arm based in Milwaukee, Wisconsin. The enterprise has made strategic investments in healthcare technology companies, including leading a $24 million Series B funding round for Xealth in 2021 and participating in various healthcare-focused venture investments. In March 2024, the organization divested Senior Helpers, a home care company previously acquired by Advocate Aurora Enterprises in April 2021, selling it to private equity firm Waud Capital Partners after determining it no longer aligned with the strategic priorities of Advocate Health.

The ownership structure maintains the distinctive regional brands across its footprint, with operations continuing under the Advocate Health Care name in Illinois, Atrium Health in the Carolinas, Georgia and Alabama, and Aurora Health Care in Wisconsin. This brand preservation strategy reflects the organization’s commitment to maintaining local community connections while leveraging the benefits of scale and integration across the broader enterprise.

5) Financial Position

Advocate Health has demonstrated strong financial performance since the 2022 merger, with substantial improvements in operating margins and overall financial stability. For fiscal year 2024, the organization reported annual revenues of $34.8 billion, ranking as the third-largest nonprofit health system in the United States by operating revenue. The system generated operating income of $1.2 billion, representing a 3.5% operating margin, which doubled from the previous year’s performance.

The financial momentum continued into 2025, with the organization reporting operating income of $824.4 million for the first half of the year, representing an 83% increase compared to the same period in the prior year. This significant improvement reflects the benefits of scale achieved through the 2022 combination and enhanced operational efficiency across the integrated platform.

Advocate Health maintains a strong balance sheet with over $21.8 billion in unrestricted cash and investments, providing substantial financial flexibility for strategic initiatives and capital investments. The organization’s credit profile has been recognized by major rating agencies, with Moody’s assigning Aa3 ratings to its primary entities and revising the outlook to positive in May 2024, citing the benefits of scale from the merger. Fitch affirmed the system’s ‘AA’ rating in October 2025 with a stable outlook, reflecting the organization’s strong market position and financial performance.

The system has undertaken significant portfolio optimization activities, including the divestiture of two businesses previously acquired by its venture arm for a combined $477 million. This included the March 2024 sale of home care franchise Senior Helpers to private equity firm Waud Capital Partners and the planned sale of remote patient monitoring company MobileHelp, which resulted in a $150 million asset impairment write-down but improved focus on core healthcare operations.

The organization’s financial performance has been supported by diversified revenue streams across its six-state footprint, with growing exposure to supplemental funding programs providing additional support to operating earnings. North Carolina’s Healthcare Access Stabilization Program has been particularly meaningful to the system’s financial performance, demonstrating the benefits of geographic diversification.

Capital allocation priorities include significant investments in community health and infrastructure improvements. In December 2024, Advocate Health unveiled a $1 billion investment plan for Chicago’s South Side, including construction of a new $300 million, 52-bed hospital to replace Advocate Trinity Hospital. Additionally, in August 2025, the organization announced a $3 billion investment across its rural operations in six states to support infrastructure, staffing, technology, and uncompensated care.

The system has also demonstrated its commitment to community benefit through substantial investments in patient financial assistance and community programs. Advocate Health provides over $6 billion annually in community benefits and announced in September 2024 that it would cancel more than 11,500 judgment liens on patients’ homes and forgive the associated medical debt, reflecting its dedication to addressing healthcare affordability challenges.

Revenue cycle improvements and operational efficiency gains have contributed to the strong financial performance, with the organization implementing advanced technology solutions and standardized processes across its integrated platform. The system’s scale advantages in procurement, shared services, and clinical programs have generated meaningful cost synergies that have supported margin expansion while maintaining high-quality patient care.

6) Market Position

Advocate Health holds a dominant market position as the third-largest nonprofit integrated health system in the United States, serving nearly 6 million patients annually across a six-state footprint encompassing Alabama, Georgia, Illinois, North Carolina, South Carolina, and Wisconsin. The organization’s scale and geographic diversification provide significant competitive advantages in both patient attraction and payer negotiations.

The system operates 69 hospitals and more than 1,000 care locations, creating comprehensive regional networks that offer patients seamless care coordination across the continuum of services. This extensive infrastructure positions Advocate Health as a market leader in each of its primary service areas, with particularly strong market presence in the Chicago metropolitan area through the Advocate Health Care brand, the Charlotte region and broader Carolinas through Atrium Health, and Wisconsin through Aurora Health Care.

Advocate Health’s academic medical center platform, anchored by Wake Forest University School of Medicine, enhances its competitive positioning by providing access to cutting-edge research, clinical trials, and subspecialty services that smaller competitors cannot match. The organization operates one of the nation’s largest graduate medical education programs with over 2,000 residents and fellows across more than 200 programs, ensuring a continuous pipeline of well-trained physicians and maintaining teaching hospital status that supports complex care capabilities.

The system has achieved national recognition for clinical excellence through its U.S. News & World Report rankings, where it leads Illinois, North Carolina, and Wisconsin with the most hospitals recognized in the “Best Hospitals” rankings. In 2025, Advocate Health earned 12 “Top 50” national rankings for adult specialties, with 29 award-winning hospitals on the Best Hospitals list and 209 “High Performing” procedures and conditions designations, demonstrating consistent quality across its enterprise.

Innovation leadership distinguishes Advocate Health from competitors, with the organization operating the largest ambient listening deployment for Microsoft DAX and being the first health system in the United States to deploy Microsoft’s DAX Copilot for physicians. The system has over 15,000 users engaging with AI assistants, ambient listening, or predictive analytics tools, positioning it at the forefront of healthcare technology adoption. The opening of The Pearl innovation district in Charlotte in June 2025 created a multi-billion-dollar medical innovation hub that attracts corporate partners including Siemens Healthineers, Stryker, and Boston Scientific.

Strategic partnerships enhance Advocate Health’s market position through expanded service capabilities and technology integration. The organization maintains partnerships with Best Buy Health for hospital-at-home services, operating the largest hospital-at-home program in the country with a daily census approaching 100 patients. These partnerships enable the system to offer innovative care delivery models that competitors may struggle to replicate without similar scale and resources.

The system’s financial strength, with annual revenues of $34.8 billion and strong credit ratings from major agencies, provides competitive advantages in capital markets access and strategic acquisition opportunities. This financial capacity has enabled major investments including the $1 billion Chicago South Side expansion and $3 billion rural investment program, demonstrating the organization’s ability to strengthen market position through targeted growth initiatives.

Advocate Health’s commitment to community benefit, providing over $6 billion annually in community benefits, strengthens its market position by building community loyalty and fulfilling nonprofit mission requirements. The organization’s faith-based heritage and values-driven approach resonate with many communities, particularly in markets where mission alignment influences patient choice and community support.

The organization faces competitive pressures from other large health systems, physician-owned facilities, and emerging care delivery models including telehealth providers and retail health clinics. However, its comprehensive service offerings, quality recognition, innovation capabilities, and community connections provide substantial competitive moats that help defend market share and support continued growth across its footprint.

7) Legal Claims and Actions

Advocate Health has faced significant legal and regulatory enforcement actions over the past decade, with particular concentration in healthcare privacy violations, employment law violations, and government contracting-related offenses. The organization has paid over $43 million in penalties across 22 documented enforcement actions since 2000, demonstrating a pattern of compliance challenges across multiple regulatory domains.

The most substantial legal actions against Advocate Health relate to healthcare privacy violations under HIPAA. In August 2016, Advocate Health Care Network agreed to pay a record-setting $5.55 million settlement with the U.S. Department of Health and Human Services Office for Civil Rights (OCR), representing the largest HIPAA enforcement settlement against a single entity at that time. This settlement arose from three separate data breaches occurring between July and November 2013, affecting approximately 4 million patients and exposing demographic information, clinical data, health insurance details, patient names, addresses, credit card numbers with expiration dates, and dates of birth.

The breaches involved the theft of four unencrypted desktop computers from Advocate Medical Group’s administrative offices in Park Ridge, Illinois, the theft of an unencrypted laptop from an employee’s unlocked vehicle, and unauthorized access to a business associate’s network. OCR’s investigation revealed systematic failures including the organization’s inability to conduct accurate risk assessments of electronic protected health information vulnerabilities, implement adequate facility access controls, obtain proper business associate agreements, and reasonably safeguard unencrypted devices. The violations allegedly dated back to the inception of the HIPAA Security Rule, demonstrating long-standing compliance deficiencies.

More recently, in 2024, Advocate Aurora Health agreed to pay $12.225 million to settle a class action lawsuit regarding pixel tracking technology violations. The settlement resolved allegations that the health system disclosed personal information of over 2.5 million people to Meta and Google without consent through tracking pixels installed on its website, patient portal, and mobile applications between October 2017 and October 2022. The tracking technology collected users’ IP addresses, appointment dates and times, physician identities, communications through patient portals, and health insurance information, constituting unauthorized disclosure of protected health information under HIPAA.

Advocate Health has faced multiple enforcement actions under the False Claims Act relating to improper billing practices and physician compensation arrangements. In 2018, Aurora Health Care Inc. agreed to pay $12 million to settle allegations that it violated the False Claims Act by submitting claims to Medicare and Medicaid in violation of the Stark Law during certain periods from 2008 to 2012. The settlement addressed compensation arrangements with two physicians that allegedly did not comply with the Stark Law because the compensation was not commercially reasonable, exceeded fair market value, took into account anticipated referrals, and was not for identifiable services.

Advocate Health has faced substantial employment-related enforcement actions totaling over $8 million in penalties. The largest employment law settlement occurred in 2016 when Advocate Health Care paid $4.75 million for wage and hour violations. Additional employment law penalties included a $1.5 million settlement in 2019 for wage and hour violations, and $480,000 paid by Aurora Health Care in 2011 for similar violations. The organization has also faced discrimination and workplace safety violations, with Aurora Health Care Inc. paying $80,000 in 2015 for employment discrimination, $60,000 in 2017 for Americans with Disabilities Act violations, and various penalties for Family and Medical Leave Act violations.

Environmental violations have resulted in over $661,000 in penalties, with the largest being a $340,000 hazardous waste violation against Aurora Health Care Inc. in 2014. Air pollution violations resulted in additional penalties of $250,000 in 2008 and $5,000 in 2013.

Beyond regulatory enforcement, Advocate Health has faced numerous civil lawsuits including medical malpractice claims, employment discrimination cases, and privacy-related class actions. The organization faced class action lawsuits related to the 2013 data breaches, though Illinois appellate courts ultimately dismissed these cases in 2015, finding that plaintiffs failed to demonstrate concrete harm sufficient to establish standing under federal law.

The systematic nature of these enforcement actions, spanning privacy violations, employment law compliance, government contracting irregularities, and environmental violations, indicates ongoing compliance challenges across multiple regulatory domains. The total penalty amount of over $43 million across 22 enforcement actions since 2000 demonstrates the significant financial and reputational impact of these compliance failures on the organization’s operations.

8) Recent Media

Advocate Health reported strong financial performance through the first half of 2025, with operating income of $824.4 million representing an 83% increase compared to the same period in the prior year. For the full fiscal year 2024, the system was ranked the third-largest nonprofit health system by operating revenue at $34.8 billion, with operating income doubling to $1.2 billion, representing a 3.5% margin. The system undertook a portfolio realignment in 2024, divesting two businesses previously acquired by its venture arm for a combined $477 million. This included the March 2024 sale of home care franchise Senior Helpers to private equity firm Waud Capital and the planned sale of remote patient monitoring company MobileHelp later in the year, which resulted in a $150 million asset impairment write-down. The system’s improved financial standing was noted by credit rating agencies, with Fitch affirming its ‘AA’ rating in October 2025 and Moody’s revising its outlook to positive in May 2024, citing the benefits of scale from the 2022 merger.

The organization has announced significant strategic investments aimed at community health and health equity. In December 2024, Advocate Health unveiled a $1 billion plan for Chicago’s South Side, which includes the construction of a new $300 million, 52-bed hospital to replace the aging Advocate Trinity Hospital, along with the establishment of 10 new neighborhood care centers. The Illinois Health Facilities and Services Review Board received the application for the discontinuation of the existing 205-bed Advocate Trinity Hospital in January 2025, with a projected completion date of June 2029. Separately, in August 2025, Advocate Health announced a $3 billion investment in its rural operations across six states to support infrastructure, staffing, technology, and uncompensated care.

Advocate Health has made several operational changes affecting patient access and finances. In September 2024, the system announced it would cancel more than 11,500 judgment liens on patients’ homes and forgive the associated medical debt. However, a January 2025 report from The Guardian and the Center for Health Journalism detailed criticism from former patients who stated the system’s prior aggressive collection tactics had led to financial distress. In January 2025, Advocate Health Care announced the closure of its 47 clinics inside Walgreens stores across Illinois, effective February 6, 2025, to refocus on virtual care and other community access points. In April 2025, media reported that Advocate Physician Partners would exit Blue Cross Blue Shield of Illinois’ HMO network effective July 1, 2025, a move impacting in-network physician choices for some patients, although Advocate hospitals remain in the network.

The health system has been the subject of several significant legal actions and verdicts. In February 2024, a Cook County jury returned a record $39.9 million verdict against Advocate Physician Partners in a medical malpractice case involving a failure to treat symptoms that led to a debilitating stroke. In March 2024, another Cook County jury awarded $45.3 million in a separate medical negligence case where a failure to properly intubate a patient resulted in permanent brain damage. A May 2025 verdict awarded $20 million in a birth injury case against Advocate Christ Hospital and Medical Center. In February 2024, a class-action lawsuit was filed in Wisconsin accusing Advocate Aurora Health of using anticompetitive practices to establish a monopoly and charge excessively high prices. In June 2024, a court dismissed a class action lawsuit against Advocate Aurora Health that had alleged violations of the Illinois Genetic Information Privacy Act (GIPA).

Advocate Health has also addressed a major data privacy incident. In August 2023, its predecessor entity, Advocate Aurora Health, agreed to a $12.25 million settlement to resolve a class-action lawsuit stemming from its use of third-party pixel tracking technologies on its websites and patient portals. The breach, first disclosed in October 2022, may have impermissibly shared the protected health information of up to 3 million patients with outside vendors such as Google and Meta.

Workplace culture and executive changes have been prominent in media coverage. In May 2024, a group of employees at Advocate Christ Medical Center in Oak Lawn, Illinois, protested what they described as a “double standard” in the health system’s response to the humanitarian crisis in Gaza compared to its public support following the invasion of Ukraine. In November 2024, WBBM-TV reported that the U.S. Occupational Safety and Health Administration had opened an investigation after a therapist at Advocate Good Samaritan Hospital was brutally attacked by a patient, leaving her with a fractured skull and spine. In April 2025, the longtime former president of Advocate Illinois Masonic Medical Center filed a lawsuit alleging she was fired due to age discrimination. The system has also seen significant leadership turnover, including the August 2023 resignation of Executive Vice President and CFO Anthony DeFurio. In mid-2024, several high-profile executives from the legacy Advocate Aurora Health organization departed, including co-CEO Jim Skogsbergh, who retired as planned at the end of May, and Cristy Garcia-Thomas, Chief Diversity, Equity and Inclusion Officer, who left in August.

9) Strengths

Advocate Health demonstrates exceptional clinical excellence through its U.S. News & World Report rankings, where it leads Illinois, North Carolina, and Wisconsin with the most hospitals recognized in the “Best Hospitals” rankings. In 2025, the system earned 12 “Top 50” national rankings honoring the quality of its adult specialties, with Advocate Christ Medical Center ranking 14th nationally in obstetrics and gynecology and 23rd in cardiology and heart surgery. Across the enterprise, Advocate Health has 29 award-winning hospitals on U.S. News & World Report’s 2025-26 Best Hospitals list for adult specialties, along with 31 “High Performing” specialty designations signifying top 10% performance and 209 “High Performing” procedures and conditions. The system’s Advocate Children’s Hospital and Atrium Health Levine Children’s Hospital collectively earned 11 combined U.S. News & World Report national rankings for pediatric specialties.

Advocate Health operates one of the nation’s largest graduate medical education programs with over 2,000 residents and fellows across more than 200 programs. The system’s academic foundation is anchored by Wake Forest University School of Medicine, which serves as the academic core with 1,264 students enrolled in MD and PA programs and faculty that has grown to 3,200 members. The organization maintains primary academic affiliations with the University of Illinois College of Medicine in Chicago, Rosalind Franklin University of Health Sciences/Chicago Medical School, and Midwestern University/Chicago College of Osteopathic Medicine as the leading trainer of primary care physicians in Illinois. This educational infrastructure positions Advocate Health as a significant contributor to addressing healthcare workforce shortages, training more than 1% of all residents and fellows in the nation.

Advocate Health has established itself as a leader in AI deployment across healthcare, with over 15,000 users engaging with AI assistants, ambient listening, or predictive analytics tools. The system operates the largest ambient listening deployment for Microsoft DAX and was the first health system in the United States to deploy Microsoft’s DAX Copilot for physicians, achieving a 47.1% reduction in time spent on electronic health record tasks at home for participating physicians. The organization has expanded this AI leadership by piloting Microsoft’s Project Nursing for nurses and implementing Aidoc’s AI platform across its imaging operations, projecting that nearly 63,000 patients annually will benefit from faster prioritization and earlier diagnoses. Virtual nursing programs have reduced cognitive workload by approximately 43,000 hours in 2024 alone, with nurse turnover rates dropping from 13% to 3% among nurses using virtual platforms.

The system has created The Pearl innovation district in Charlotte, a multi-billion-dollar medical innovation hub that opened in June 2025, bringing together Wake Forest University School of Medicine, surgical training institute IRCAD North America, and corporate partners including Siemens Healthineers, Stryker, and Boston Scientific. This innovation ecosystem is expected to generate more than 11,000 jobs for the Charlotte region and positions Advocate Health to serve as a “living laboratory” for testing new models of care supported by AI, medtech collaboration, and academic research. The organization maintains strategic partnerships with technology companies including Microsoft for AI solutions, Best Buy Health for hospital-at-home services, and operates the largest hospital-at-home program in the country with a daily census approaching 100 patients.

Advocate Health has earned recognition as one of Newsweek’s “Top 100 Most Loved Workplaces” for 2023, representing one of only five health providers nationwide to receive this designation. The organization achieved an 85.8% recommendation rate as a great place to work among its 162,000 teammates, with leader trust ratings reaching 82% and exceeding the 75th percentile healthcare benchmark in multiple key areas. Advocate Health received gold-level recognition from the American Medical Association as a “Joy in Medicine” organization, the highest possible level of recognition for demonstrating excellence in reducing physician burnout and enhancing professional fulfillment. The system has also been recognized with multiple Forbes “Best Employers” designations across Georgia, Illinois, North Carolina, South Carolina, and Wisconsin.

Advocate Health has maintained a 16-year streak of “System for Change Awards” from Practice Greenhealth, the longest in the country, reflecting enterprise-level commitment to environmental sustainability. The organization has reduced greenhouse gas emissions by over 3,400 metric tons of carbon dioxide equivalent, equivalent to taking 823 gas-powered cars off the road. Thirty-nine Advocate Health hospitals won Practice Greenhealth awards for implementing programs that reduce environmental impact, with Advocate Christ Medical Center earning the prestigious “Top 25 Environmental Excellence Award.” The system has eliminated 99.8% of plastic water bottles at hospitals in the Charlotte market and Wake Forest Baptist, transitioning more than 2.3 million bottles to sustainable materials.

As the third-largest nonprofit integrated health system in the United States, Advocate Health operates with annual revenues exceeding $34.8 billion and reported operating income of $1.2 billion for fiscal year 2024, representing a 3.5% margin. The system maintains strong credit ratings with Moody’s assigning Aa3 ratings to its primary entities and revising its outlook to positive, while Fitch affirmed its ‘AA’ rating, reflecting the system’s financial strength and benefits of scale from the 2022 merger. Advocate Health provides over $6 billion annually in community benefits, demonstrating its commitment to community investment while maintaining financial stability with over $21.8 billion in unrestricted cash and investments.

Advocate Health has implemented a comprehensive risk management approach that prioritizes collaboration, data transparency, and high reliability principles to drive transformative change and enhance patient outcomes. The organization has fostered a culture where frontline staff feel empowered to report near-miss events without fear of reprisal, leading to increased safety event reporting and proactive risk identification. Through its integrated healthcare risk management platform, the system has achieved real-time data visibility through dashboards and reporting tools that enable operational leaders to identify trends promptly and provide timely feedback to frontline staff. This approach has contributed to a 14% reduction in patient mortality since the 2022 combination and significant improvements in safety metrics across the enterprise.

10) Potential Risk Areas for Further Diligence

Advocate Health faces significant cybersecurity and data privacy risks, evidenced by substantial historical enforcement actions totaling over $43 million in penalties across 22 documented violations since 2000. The organization’s most significant compliance failure occurred in 2016 when it paid a record-setting $5.55 million HIPAA settlement for three separate data breaches affecting approximately 4 million patients, involving theft of unencrypted desktop computers and unauthorized access to business associate networks. More recently, in 2024, the health system agreed to pay $12.225 million to settle a class action lawsuit regarding pixel tracking technology violations that disclosed personal information of over 2.5 million people to Meta and Google without consent between October 2017 and October 2022. The systematic nature of these privacy violations, spanning over a decade and involving both physical security failures and digital tracking technology misuse, indicates ongoing challenges in maintaining comprehensive data protection protocols across the organization’s extensive 69-hospital network and over 1,000 care locations.

The organization operates under a complex joint operating agreement structure created in December 2022, maintaining separate legal entities while attempting unified management across six states with different regulatory environments. This structure presents ongoing integration challenges, as demonstrated by the organization’s reliance on growing exposure to supplemental funding programs to support operating earnings, with North Carolina’s Healthcare Access Stabilization Program being especially meaningful to financial performance. The system maintains different debt structures across its constituent organizations, with no cross-guarantees between Advocate Aurora Health and Atrium Health entities, creating potential coordination challenges during financial stress or major capital investments. Management acknowledges plans to consolidate obligated group structures over the outlook period, but this process introduces execution risk and potential disruption to existing debt covenants and operational procedures.

Advocate Health has faced substantial medical malpractice verdicts and settlements, indicating ongoing patient safety and clinical quality challenges despite strong safety ratings from The Leapfrog Group. In February 2024, a Cook County jury returned a record $39.9 million verdict against Advocate Physician Partners in a medical malpractice case involving failure to treat stroke symptoms. Additional significant verdicts include a $45.3 million award in March 2024 for failure to properly intubate a patient resulting in permanent brain damage, and a $20 million verdict in May 2025 for a birth injury case against Advocate Christ Hospital. These large verdicts, concentrated within a short timeframe, suggest potential systemic issues in clinical protocols or risk management procedures that could expose the organization to continued financial and reputational risk.

The organization has faced over $8 million in employment-related enforcement actions, including a $4.75 million settlement in 2016 for wage and hour violations and additional penalties for discrimination, Americans with Disabilities Act violations, and Family and Medical Leave Act violations. Recent workplace incidents include a November 2024 OSHA investigation after a therapist at Advocate Good Samaritan Hospital was brutally attacked by a patient, and an April 2025 age discrimination lawsuit filed by the former president of Advocate Illinois Masonic Medical Center. A May 2024 employee protest at Advocate Christ Medical Center regarding alleged “double standards” in the organization’s response to international humanitarian crises compared to other conflicts suggests potential internal cultural tensions that could impact employee relations and organizational reputation.

The organization has experienced significant leadership turnover, including the August 2023 resignation of Executive Vice President and CFO Anthony DeFurio, with Bradley A. Clark initially serving as interim CFO before permanent appointment in December 2023. Additional high-profile departures in mid-2024 included co-CEO Jim Skogsbergh’s planned retirement and Chief Diversity, Equity and Inclusion Officer Cristy Garcia-Thomas’s departure. The system’s recent portfolio realignment resulted in a $150 million asset impairment write-down related to the planned sale of remote patient monitoring company MobileHelp, indicating potential challenges in strategic investment decision-making and asset valuation. The organization’s growing dependence on supplemental funding programs, particularly North Carolina’s Healthcare Access Stabilization Program, creates vulnerability to changes in state and federal reimbursement policies.

Advocate Health faces ongoing antitrust litigation, including a February 2024 class-action lawsuit filed in Wisconsin accusing Advocate Aurora Health of using anticompetitive practices to establish a monopoly and charge excessively high prices. The lawsuit alleges the health system has engaged in unlawful forcing of commercial health plans to include all facilities in their networks, blocking employers and insurers from directing patients to higher-value care at non-system facilities, and using acquisitions and referral restraints to suppress competition. These allegations, if proven, could result in significant financial penalties and operational restrictions that could limit the organization’s growth strategy and pricing flexibility in key markets.

Despite leadership in AI deployment with over 15,000 users engaging with AI tools, Advocate Health’s rapid technology adoption creates implementation and security risks. The organization’s cybersecurity policy documents reveal specific vulnerabilities including requirements for employees to secure devices, avoid public wi-fi for work activities, and implement proper encryption protocols, suggesting ongoing challenges in maintaining comprehensive cybersecurity across a large, distributed workforce. The system’s extensive use of third-party tracking technologies that led to the 2024 $12.225 million settlement demonstrates ongoing challenges in managing vendor relationships and ensuring compliance with healthcare privacy regulations in an increasingly digital environment.

Healthcare organizations face inherent operational risks including physician and nursing shortages, regulatory changes affecting reimbursement rates, and increasing competition from both traditional healthcare providers and new market entrants. Market volatility can impact investment returns and funding availability for capital projects, while evolving healthcare technology and treatment modalities require continuous investment and staff training. The nonprofit healthcare sector also faces ongoing pressure to balance community benefit obligations with financial sustainability requirements, particularly in challenging economic environments.

Sources

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