Hospital Talks Off; Lawmakers Still Want Minnesota Ownership Required

By Don Davis

Minnesota leaders say they are relieved that talks ended Wednesday that could have allowed University of Minnesota health facilities to be governed by out-of-state owners, but lawmakers say they will pursue legislation to prevent that from happening in the future.

Talks among three major Upper Midwest health organizations ended Wednesday.

University President Eric Kaler said in an email that “the status quo is not sustainable,” but his office said he would not answer questions about his comments.

Sanford Health, based in North Dakota and South Dakota, announced it would end talks to merge with Fairview Health Services, a Twin Cities-based charity that operates the university’s hospitals. Then Fairview announced it would end negotiations with the university, which had floated the idea it would take over Fairview.

Minnesota lawmakers were concerned that decisions about university medical centers would be made in a Sioux Falls, S.D., board room.

“I’m relieved that that particular piece of the issue is resolved,” Rep. Dan Schoen, DFL-St. Paul Park, said, adding that the Legislature still needs to consider any future attempts to take over the university’s operations.

A bill Schoen and Rep. Joe Atkins, DFL-Inver Grove Heights, introduced would require university facilities to be controlled by a Minnesota organization.

“While I’m pleased that Sanford is withdrawing from the merger discussions, this was never about Sanford and the problem still remains,” Atkins said. “Another non-Minnesota-based entity could still try to acquire Fairview and we would once again be in the same potential situation where the University of Minnesota Medical Center would be not under Minnesota control.”

Atkins said the House Commerce Committee he leads will hold a hearing on the bill.

In 1997, the university turned over its medical center management to Fairview.

Minnesota Attorney General Lori Swanson has criticized Fairview for its operation. For instance, she said, the chief executive officer position has been vacant too long.

“I appreciate Fairview’s announcement that it will now move forward to identify a new CEO,” Swanson said Wednesday.

She also was concerned that an out-of-state organization could run Fairview and the university’s hospitals and clinics.

Swanson held a Sunday public hearing on the proposed Sanford-Fairview merger to let Minnesotans know “how a transaction of this magnitude might impact Minnesota patients and citizens.”

A follow-up April 21 public hearing has been canceled.

After Sanford and Fairview announced they no longer were in talks, Kaler sent an email expressing his disappointment that Fairview was ending talks aimed at the university taking over Fairview.

“To advance our proposal, we explored a legislative option that could provide additional support and infrastructure,” Kaler wrote. “However, it became clear that it is too late in the legislative session to introduce legislation of this scope and importance.”

Kaler said Fairview has assured him that it will continue to operate university health facilities.

“Fairview’s leadership and I are also committed to developing a shared vision for enhancing clinical care, research and education,” Kaler said. “To that end, we will begin a joint planning process and our executive teams will come together as a first step in late April.”