Essentia Health and Marshfield Clinic in merger talks

DULUTH - Duluth-based Essentia Health and Marshfield, Wis.,-based Marshfield Clinic Health System said Wednesday they are discussing a merger.

Essentia is Duluth's largest employer, and companywide employs about 15,000 people. Marshfield, headquartered in central Wisconsin, employs about 12,000 and serves patients in northern and central Wisconsin and Michigan's Upper Peninsula.

The health systems signed a memorandum of understanding to evaluate combining into an integrated regional system, according to a news release.

"I have known and admired the work of Marshfield Clinic for more than 30 years," said Essentia CEO Dr. David Herman in the release. "I am truly excited to work together for the benefit of our patients and our colleagues."

Together, they'd operate 25 hospitals and more than 160 sites, employing 3,800 providers.

Herman said the partnership would support their care models, services, research and technologies in their efforts to sustain rural health care.

In the release, Marshfield CEO Dr. Susan Turney said she sees Essentia as an organization "with world-class expertise that complements our own. And I see their long, rich history of serving communities with a mission very similar to ours."

The memorandum of understanding is the first step toward a potential merger, which would likely take months. No other information was shared Wednesday.

An Essentia merger with Chicago-based CommonSpirit Health, under the Catholic Health Initiatives (CHI), fell through in May 2021. Essentia was poised to take over two dozen CHI-branded properties including CHI St. Alexius Health in Bismarck, N.D., and a suite of rural clinics and hospitals in Minnesota.

Essentia this month acquired Mid Dakota Clinic, which employs about 300 in Bismarck.

Essentia will begin serving patients next summer in its new hospital tower and clinic space in downtown Duluth, a $915 million project. The system earned $2.45 billion in revenue in its fiscal year ending in June.

In 2020, it laid off 6% of its workforce at the start of the COVID-19 pandemic. The cancellation of things like elective surgeries during the state's pandemic restrictions led to $100 million in revenue loss in just a couple of months.

Essentia's nurses were recently part of a historic strike, where as many as 15,000 nurses in the Twin Cities, Duluth and Superior walked off their jobs for three days in protest over pay and staffing levels.