MINNEAPOLIS — The University of Minnesota is ready to take "bold steps" to take control of what officials call its flagship health care facilities to prevent "out-of-state control of Minnesota's academic health care system."
In a message to the state of Minnesota and lawmakers made public Friday, the university made a preliminary request for $950 million, $300 million of it to acquire University Medical Center East and West Bank facilities, Masonic Children’s Hospital and the Clinics and Surgery Center. The other $650 million would go toward operating and investing in those facilities.
“Before us is a once-in-a-lifetime opportunity to channel the University’s 170-plus year legacy of discovery, service and world-class impact to elevate the health of Minnesotans for generations to come,” said University President Joan Gabel. “But we can only do so through a strong partnership with the State. The positive return on this investment is clear.”
If supported, the request would allow the U of M to take control of the medical assets before a Fairview/Sanford merger - a development currently targeted for May 31, 2023 - something the university is on record as opposing.
Sanford is based in South Dakota.
"Control of Minnesota’s academic health care assets by a South Dakota-based entity is a non-starter,” said Dr. Jakub Tolar, dean of the Medical School and vice president for clinical affairs. “The charitable assets of the University’s academic health facilities and operations have been supported by Minnesotans and must be governed by the University of Minnesota.”
The request for funds is being made in advance of formal action by the Board of Regents expected on March 10.
Sanford is one of the largest rural health systems in the U.S. with 224 primary and specialty clinics, 47,000 employees and 47 hospitals. Fairview is one of the biggest in the Twin Cities, with 80 primary and specialty care clinics, 31,000 employees and 11 hospitals – including the U's medical center.
The two health systems explored a possible merger in 2013 but the deal fell apart after concerns from state leaders over the control of the University of Minnesota Medical Center.
The current merger plan on the table would create one of the largest health care providers in the country. Sanford CEO Bill Gassen and Fairview CEO James Hereford told KARE 11 in early February that they understand concerns patients and employees have voiced since announcing their plans to merge. The two have spent weeks visiting hospitals and clinics across Minnesota to address fears about everything from care to union contracts.
Fairview issued a statement Friday afternoon:
Fairview is proud of the partnership we’ve had with the University of Minnesota since 1997. In that time, we have delivered unrivaled care for patients in our community. Since acquiring the East Bank hospital in 1997, Fairview has invested $911M of capital in our facilities on the University campus in addition to millions in academic support for the University’s teaching mission.
We have shared that we are open to discussing options for the University to purchase the medical center and other Fairview assets on its campus at fair market value. However, many important details from the announcement today remain unclear.
We’re disappointed that the University did not share anything about their new proposal when we met just a few days ago. Health care is a complex and serious business with patients at the end of every decision. Negotiating the University’s proposal through the news media doesn’t allow for the thoughtful dialogue we need to develop the best possible plan to ensure stability for our staff and continuity of care for the patients we serve. We remain committed to working with our staff – including the clinical faculty – to provide the highest quality care.
--Fairview Health Services
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