Collapse of Fairview-Sanford merger spurs ire and relief in Minnesota

Unionized nurses are breathing a sigh of relief, saying the proposed Sanford-Fairview merger that collapsed Thursday would have harmed access to care while putting into question the future of academic medicine at the University of Minnesota.

But at the state Senate, a leading Republican on health care issues argues the demise of the deal showed DFL antagonism to business interests while suggesting the state attorney general had been given too much power to review health care mergers.

The contrast invokes the divide the Sanford-Fairview proposal created across Minnesota over the past nine months, from a St. Paul hearing in January where opponents questioned the impact on patients seeking abortion and mental health care to a Bemidji meeting where Sanford loyalists said the health system had been a good corporate citizen.

U medical students prominently voiced their opposition at a session in Grand Rapids even as some residents in the northern Minnesota town said a merger could bring needed economic stability.

All the hearings were convened by Attorney General Keith Ellison as part of his investigation into the proposed combination between South Dakota-based Sanford Health and Minneapolis-based Fairview Health Services. The merger would have created a health system with some 78,000 employees and more than 50 hospitals.

Sanford's board decided Thursday to discontinue the merger process. Fairview followed suit.

"We know the proposed merger has been of vital interest to Minnesotans," Ellison said Thursday. "Our investigation received more than 6,000 comments from Minnesotans about it, including at four well-attended public meetings across the state."

Thursday's announcements marked the second time in roughly a decade that Sanford and Fairview failed to complete a high-profile merger. Fairview owns the teaching hospital at the University of Minnesota, where opposition extended beyond students to the U's health care leadership.

The Minnesota Nurses Association said Thursday in a statement that its members worried the deal would increase costs while threatening both jobs and working conditions.

"Minnesotans have come to expect a high standard of care and nurses are relieved that we will continue to be able to provide that care and protect our profession," Mary Turner, president of the Minnesota Nurses Association, said in a statement.

Turner also is a member of the Board of Regents at the U.

But Sen. Paul Utke, R-Park Rapids, said the collapse illustrated that Ellison's investigation and the extended powers given to his office by the Legislature this spring showed how "Democrats are not working in good faith to give every business the opportunity to thrive."

"This is yet another example of a company realizing the overreach and heavy-handed government from St. Paul Democrats just isn't worth it," Utke said in a statement. He is the lead Republican on the Senate Health and Human Services Committee.

Beyond the reactions, what remains going forward are difficult questions about whether Fairview and the University of Minnesota can pick up the pieces of their partnership running one of the state's largest clinical enterprises. It's a network that includes dozens of clinics and hospitals like M Health Fairview Southdale in Edina.

The current affiliation for Fairview and the U runs through 2026. It's not clear given all the acrimony that's emerged with the merger debate whether one side will just cut and run, since there's a year-end contractual deadline for giving notice if either party doesn't want to continue long-term.

In a memo sent to employees on Thursday, the U's medical school dean Dr. Jakub Tolar didn't offer hints about what might be coming next.

"As we move forward from here, we will continue to do our part to advance the health of Minnesotans," Tolar wrote.