Duluth residents weigh in on potential health care mergers in front of attorney general's office

DULUTH — Mergers involving Duluth's two health care systems drew mostly support from local leadership during a public meeting held by Minnesota Attorney General Keith Ellison's office Wednesday night at the University of Minnesota Duluth.

Speakers working in health care fields, though, were more skeptical.

More than 200 people filled the Kirby Rafters on campus to offer takes on the potential merger between Essentia Health and Marshfield Clinic Heath System, and one between St. Luke's and Aspirus Health. Members of Ellison's office — though not Ellison — were on hand to collect comments on the deals and determine whether they are in the public's best interest.

Essentia Health, the city's largest employer, and the central Wisconsin-based Marshfield Clinic Health System signed a memorandum of understanding in October 2022, then added an integration agreement in July. St. Luke's and Wausau, Wis.-based Aspirus Health announced plans to merge in mid-July. The two recently signed a definitive agreement — which includes Aspirus' plans for a $300 million investment in St. Luke's strategic projects over the next eight years, in addition to expansion and technical upgrades.

Duluth mayor Emily Larson opened the public comment period with support for St. Luke's plans and neutrality on Essentia Health's proposal. She said she could see the benefits of the former and what Marshfield would gain by joining with Essentia — but she wasn't sure what was in it for the locals.

"I'm not yet clear on how that helps protect workers, patients, and the community in Duluth and I am concerned that the financial risk of Marshfield becomes that of Essentia and Duluth," she said. "And there is my concern for public interest."

UMD's interim chancellor David McMillan and St. Scholastica's president Barbara McDonald supported both mergers — and the growth of opportunity for students studying to be health care professionals. City Councilor Arik Forsman and Kristi Stokes of Downtown Duluth spoke in favor of the consolidations, along with Matt Baumgartner, president of the Duluth Area Chamber of Commerce.

He said both health care systems are integral to the city's success now and in the future.

"Our health care systems are the largest employers in the region," he said. "This employment contributes to the economic stability of the area, further many of these jobs employ a diverse workforce."

Some residents with ties to healthcare professions were against the mergers. Consolidation reduces services and leads to the consolidation of insurance companies, some said, in addition to decreases in affordability and access.

Melissa Larson said she has seen a lot in the more than 35 years she has worked in Duluth health care.

"The purpose of a nonprofit is to benefit the community it serves through its promotion of health and to operate to serve the public rather than private interest," she said, adding that she has seen physicians bound by non-compete clauses, patient referrals restricted to providers within a specific system, and access to operating rooms shut off to surgeons and practitioners who are not employed within the system.

Tristan Eastvold, a nurse in Moose Lake, Minn., said the rural hospital she worked at was bought by Essentia Health, which led to less access to care within the immediate community and employees who are spread thin.

"This merger is more about having more weight when it comes to dealing with insurance companies than helping rural communities," she said. "That's my viewpoint and that's what I've seen."

If the Essentia-Marshfield merger is approved, a new parent company could be formed by the end of this year — though both entities would retain their names, for now, and their separate headquarters in Duluth and Marshfield, Wis., according to a news release from Essentia.

The system would have 25 hospitals, 3,800 clinicians and 150 sites of care in North Dakota, Minnesota, Wisconsin and Michigan's Upper Peninsula.

Essentia Health opened its new state-of-the-art 924,000-square-foot St. Mary's Medical Center in July. The four-year project cost $915 million and is the largest private investment in the city's history.

When St. Luke's and Aspirus announced their merger, the nonprofits had set a goal of completing the process in early 2024. Headquarters would stay in Wisconsin, and Duluth would have a corporate office. St. Luke's six unions have signed letters of support for the joining of the two systems — which includes 19 hospitals, 130 outpatient locations and nearly 14,000 team members, according to a news release from St. Luke's.