Proposed Sanford-Fairview merger warrants serious skepticism

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Minnesota has a reputation for excellent health care. It is emblematic of our core values. Simply put, Minnesotans care about their neighbors. We are rightly proud of that.

We have also been proud of our nonprofit health sector, where patients and care came first and profitability came second. However, in recent years our nonprofit health sector has changed. Increasingly, we see our health care organizations focused on profits, with illness viewed as a business opportunity and patients as capitation units. Our vaunted system is eroding.

Sadly, some nonprofit HMOs ("health maintenance organizations") now behave just like their brethren in the for-profit sector. They raise premiums and deductibles to unaffordable levels and go to great lengths to avoid paying for care that the doctor orders and the patient needs. The same is true in health care delivery, where large health care systems make so many decisions focused on the bottom line instead of the needs of the population they serve.

The current proposal for Sanford of South Dakota to merge with Fairview has the potential to accelerate this process. Fairview, a trusted Minnesota nonprofit, would be no more. The new company would be called "Sanford," with headquarters in Sioux Falls, potentially beyond the reach of Minnesota's laws and regulators.

For several years, Sanford has angled to become a larger player. Its proposed merger with Intermountain Health System, serving Utah, Nevada and Idaho, failed to be consummated. A more recent effort to join with Unity Health Care, serving Iowa, Illinois and Wisconsin, also derailed. The common element in these proposals was that Sanford would lead the new entity, as is the case with the current proposal. Even though the current proposal includes retaining the current Fairview president for a year in a support role and keeping Fairview's board, it is clear Sanford will be leading the organization.

Sanford claims it will provide greater access to high-quality, equitable health care, accelerate population health and value-based care, and drive clinical innovation for the benefit of rural, urban and Indigenous communities across the Midwest. Who could be against such worthy aspirations?

We worry that these lofty aims will not translate into benefits for Minnesotans. If savings occur, will they be passed onto the patients and employers who are paying the bills, or will they be siphoned off to the benefit of Sanford? Will outcomes truly improve, or just operating margins? And what about the nurses, doctors and other practitioners who work for Fairview? Will they benefit? Or will they be seen as just another cost on a South Dakota spreadsheet?

Across the country, many have expressed concerns about ever-larger corporations running our health care institutions as similar mergers have become common. Decisions and policies affecting life and death move farther from caring doctors and concerned patients. Too often, an accident or illness means financial ruin, and even those who buy expensive insurance policies are not always protected. It is hard to see how moving policymaking and health care decisionmaking a state away will improve matters.

An additional and unique concern is the impact of this merger on the University of Minnesota Hospital and Clinics, which currently operate as part of the Fairview system. The university, a taxpayer-supported institution, is dedicated to training and research in addition to patient care. That mission is not always consistent with maximizing profit. If the university falls under Sanford's control, history suggests that profit maximization will be the goal. The regents of the university have the power to pull back from their deal with Fairview. If they do, most experts agree that the Sanford acquisition of Fairview is much less likely.

Whatever happens with this merger, it must not include putting any part of the University of Minnesota under Sanford's control or at its mercy.

A Sanford/Fairview merger would be one of the most consequential developments in Minnesota health care in many years. It must be subject to vigorous scrutiny by the public, regulators and the Legislature. As we return to the State Capitol next month, we will be looking carefully to see whether our existing laws and systems are up to the challenge of assessing this proposal, or if changes must be made to ensure that Minnesota's vital interests are protected.

Jim Abeler, R-Anoka, is a member of the Minnesota Senate. Tina Liebling, DFL-Rochester, and Zack Stephenson, DFL-Coon Rapids, are members of the Minnesota House.