Large rural health system Sanford Health to merge with urban Fairview
This is the second attempt at a merger in a decade.
Sanford Health President and CEO BIll Gassen (left) and Fairview Health Services President and CEO James Hereford
Photo: Courtesy Sanford Health
Rural health system Sanford Health and urban Fairview Health Services in Minnesota have signed a nonbinding letter of intent to combine and create a new health system.
The name of the parent company will be Sanford Health. Sanford Health CEO Bill Gassen will serve as president and CEO on completion of the merger, and Fairview Health Services CEO James Hereford will serve as co-CEO for a period of one year post-closing.
The combined system will serve urban and rural populations across complementary geographic footprints.
The governing boards of both health systems have approved proceeding with necessary steps, such as due diligence and review processes, with the goal of organizing Fairview Health Services and Sanford Health under a single integrated health system. The intention is for a definitive agreement to be signed and the closing of the transaction is anticipated in 2023, pending antitrust and other required reviews and closing conditions.
WHY THIS MATTERS
This is the second attempt by the health systems to merge the two systems, according to the Star Tribune. A similar deal was scuttled by state political concerns in 2013, the report said.
The new Sanford Health would become one the largest health systems in the Upper Midwest, with more than 50 hospitals, including the University of Minnesota Medical Center, the report said.
Sanford is promoting the merger as being able to provide more access to high-quality, equitable healthcare, accelerate population health and value-based care, and drive clinical innovation for the benefit of rural, urban and Indigenous communities across the Midwest.
"As a combined system, we can do more to expand access to complex and highly specialized care, utilize innovative technology and provide a broader range of virtual services, unlock greater research capabilities and transform the care delivery experience to ensure every patient receives the best care, no matter where they live," Gassen said.
The merger brings together complementary capabilities and combined resources, Hereford said.
Sanford Health and Fairview Health Services will remain nonprofit entities, each with its own regional presence, leadership and regional boards in the markets they serve.
THE LARGER TREND
Sanford Health is among the largest rural health systems in the United States. Headquartered in Sioux Falls, South Dakota, the organization serves more than 1 million patients and 220,000 health plan members across 250,000 square miles. The integrated health system has 47 medical centers, 2,800 Sanford Health physicians and advanced practice providers, 170 clinical investigators and research scientists, more than 200 Good Samaritan Society senior care locations, and world clinics in 8 countries.
Fairview Health Services is a Minneapolis-based nonprofit health system that includes 31,000 employees across 11 hospitals, more than 80 primary and specialty care clinics, 36 retail and specialty pharmacies, rehabilitation centers, physician network, senior care housing and long-term care facilities, and medical transportation.
Twitter: @SusanJMorse
Email the writer: SMorse@himss.org
