Essentia Health, CHI merger falls through

DULUTH – Merger talks between Essentia Health and CommonSpirit Health have ended without a deal, leaving a number of hospitals in Minnesota and North Dakota under the Catholic Health Initiatives (CHI) brand for the time being.

"While we share a similar mission, vision, values and strong commitment to sustainable rural health care, CommonSpirit and Essentia were unable to come to an agreement that would serve the best interests of both organizations, the people we employ and the patients we serve," said a statement from both health systems. "We've strengthened our relationship throughout this process and remain committed to possibilities in the future."

Duluth-based Essentia and Chicago-based CommonSpirit signed a letter of intent in January but said Tuesday that they have "chosen to end negotiations."

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. Details of the proposed transaction were scarce as talks were underway.

Earlier this month the Minnesota Nurses Association delivered a petition signed by nearly 700 people asking for guarantees over workforce levels, contracts and patient care and said the acquisition "will result in less access to patient care, not more."

Essentia, Duluth's largest employer, is building a new $900 million hospital campus downtown.

CommonSpirit is the nation's largest Catholic health system and was formed when CHI merged with Dignity Health in 2019. The system had nearly $30 billion in revenue in its last fiscal year and has locations in 21 states.

Brooks Johnson • 218-491-6496