Duke Health, CaroMont join forces in bid for two Charlotte hospitals

By Michelle Crouch

As North Carolina hospitals jockey for position in an increasingly competitive health care market, Duke Health is hoping to make another big move into Charlotte.

The Durham-based health system announced Wednesday that it’s teaming up with Gastonia-based CaroMont Health to seek state approval to build two new hospitals in Mecklenburg County, a market long dominated by Atrium Health and Novant Health.

Duke and CaroMont want to build the two hospitals in the outskirts of Mecklenburg County: a 120-bed facility in University City in north Charlotte and an 80-bed hospital in the River District, a new mixed-use community in western Mecklenburg County near the airport.

CaroMont President and CEO Chris Peek said the goal is to bring advanced medical care closer to residents in Charlotte’s fast-growing inner suburbs.

The two new hospitals would be jointly owned and operated by Duke and CaroMont through a new company, hospital officials said. They declined to provide financial details or the cost of the projects.

A review of 19 recent North Carolina hospital proposals indicates that a new facility can cost from $2.1 million to $8.7 million per bed. At those rates, Duke and CaroMont could be investing between $420 million and $1.7 billion to build the two hospitals. 

Duke and CaroMont said they planned to file applications this week for certificates of need from the N.C. Department of Health and Human Services. The state has identified a need for 389 additional hospital beds in Mecklenburg County, and Duke and CaroMont are seeking approval for 200 of those beds. They are likely to face competition from Atrium and Novant.

A state decision is expected in March.

Race to get bigger

The announcement is the latest in a flurry of hospital deal-making across North Carolina. Health systems are buying facilities, building new ones, pursuing partnerships and pushing into new markets as they strive to grow and attract more patients. 

Getting bigger can help hospitals lower costs, achieve economies of scale, spread out risk and pay for expensive new technologies and treatments, said Christopher Garmon, a health economist at the University of Missouri-Kansas City who spent 20 years studying hospital mergers at the Federal Trade Commission. 

Being larger or being part of a larger system can also give hospitals more leverage to negotiate with health insurance companies.

Recent deals in the state have raised concerns about reduced competition and higher prices at a time when the rising cost of health care is already a major concern for North Carolinians.

In perhaps the most high-profile example, Atrium Health is awaiting state and federal approval of its proposed combination with WakeMed, a regional hospital system based in Raleigh. The deal sparked months of protests before Wake County commissioners gave it preliminary approval in September. 

Duke shifts toward expansion

Duke was relatively late to the expansion game; it focused for years on building a reputation as a premier academic health system rather than expanding geographically. 

But that has shifted in recent years. In 2025, it purchased Lake Norman Regional Hospital in the Charlotte suburb of Mooresville, establishing its first Duke-branded hospital outside the Triangle.

Also in 2025, Duke announced a partnership with Novant Health to develop new medical facilities across the state. Duke confirmed Wednesday, however, that the partnership has ended. System officials declined to provide further details.

In financial filings, Duke Health has said its goal is to “touch 25% of the lives in North Carolina” and grow annual revenue to $20 billion. Duke currently operates four hospitals; it reported about $8.4 billion in revenue in fiscal year 2026.

“Duke Health’s mission is really broader than just the Triangle,” Duke CEO David Zaas said this week. “We know that 30 percent of Duke Health patients today travel from outside the Triangle to receive that world-class care that they expect here in Durham. So expanding our facilities into other areas across the state really is foundational to helping us continue to grow and meet the needs of those patients closer to where they live.”

CaroMont, which reported $1.07 billion in revenue in fiscal 2026, has two hospitals, in Gastonia and Belmont, along with a network of physician practices. But it’s expanding too. The system recently started construction on a $200 million cancer center in Gastonia and announced plans for a new hospital in York County, South Carolina. It’s also seeking approval from the state for a $116 million hospital in Kings Mountain.

While CaroMont holds 66 percent of market share in Gaston County, it faces competition from Atrium and Novant in the greater Charlotte region.

Peek called the chance to partner with Duke “an extraordinary opportunity” to bring more advanced medical care, clinical research and innovation to the area.

Advantages of a partnership

Duke and CaroMont executives described their arrangement as “a 50/50 partnership” and stressed that the two hospitals will be “equally owned and jointly managed.” Duke and CaroMont would own and manage their other facilities independently.

Hospital partnerships can offer many of the advantages of a merger without the complications of combining two large organizations, Garmon said.

“Mergers are terribly disruptive,” Garmon said, as hospitals struggle to integrate leadership teams, cultures and operations. “You have two big organizations trying to become one. That’s a difficult thing.”

A partnership allows two institutions to share costs and resources while maintaining their independence, he said. The arrangement can help spread the financial risk of expensive projects without either organization taking on too much debt. That could be especially appealing to nonprofit hospitals, he said, because they have less access to capital than for-profit chains. 

Garmon emphasized he had no inside knowledge of the Duke-CaroMont deal, but said he could see why the arrangement could appeal to both systems.

“If Duke wants to get bigger and wants to get into the Charlotte market, CaroMont – even though it’s small — maybe has some brand equity in Charlotte. And Duke has their expertise as an academic medical center,” he said. “They have some complementary strengths to bring to their partnership.”

This article is part of a partnership between The Charlotte Ledger and North Carolina Health News to produce original health care reporting. You can support this effort with a tax-deductible donation.