Former Minnesota governors say Sanford should not control U of M hospital

March 9, 2023

ST. PAUL, Minn.–Two former Minnesota governors on Tuesday expressed concerns to lawmakers about a potential merger between two already large health care systems — Fairview Health Services and Sanford Health.

Michell Griffith with South Dakota Searchlight reports former Governors Tim Pawlenty, the last Minnesota Republican to win statewide office, and his DFL successor Mark Dayton (pictured),  came together to urge lawmakers to prioritize Minnesotans’ interests in the face of Sioux Falls-based Sanford Health proposing to absorb Fairview to create one health care system run by the South Dakota company.

This was a rare appearance from Dayton, who has been dealing with health issues for years. He attended Tuesday’s hearing alongside his wife and walked slowly with the help of a cane. Both Pawlenty and Dayton turned spectators’ heads when they walked in, and they posed for a photo with their arms around each other in front of press photographers.

“This is the first time he and I have spoken together publicly, which underscores the great importance we attach to these critical matters,” Dayton told members of the Senate Health and Human Services Committee Tuesday.

At the heart of the former governors’ concerns is the University of Minnesota Medical Center. In 1997, Fairview purchased the medical center, which is the university’s primary teaching hospital. As a land-grant institution dedicated to bettering Minnesota under the state’s constitution, the U cannot have an out-of-state company running the teaching hospital, Dayton and Pawlenty said.

Dayton, who served two terms, condemned the proposed merger and told senators that it should be prohibited.

“The prospect of governance of the University of Minnesota’s academic health center could shift to a South Dakota-based enterprise is alarming and should never be allowed to happen,” Dayton said. “To allow any other arrangement would be a terrible betrayal of the trust bestowed by the people of Minnesota.”

Pawlenty, wearing a University of Minnesota quarter-zip sweatshirt, emphasized how important the university is to Minnesota’s success.

“When you think about what M Health is — that big sign out front, that big maroon ‘M’ on the front door of all these buildings all across Minnesota — it’s there for a reason,” Pawlenty said. “It doesn’t stand for, you know, out-of-state health … It stands for Minnesota Health.”

After pushback from Minnesota lawmakers a few months ago, Sanford and Fairview delayed the merger’s deadline from March 31 to May 31, but Attorney General Keith Ellison on Tuesday said he wishes the date would be delayed further.

Ellison said this would give his office more time to thoroughly investigate the merger for any breaches of charity laws — both Fairview and Sanford are nonprofits — and antitrust laws. Ellison on Tuesday didn’t disclose details about his ongoing investigation, but he did say his office is still seeking “significant information” that it believes it should have already received from Sanford and Fairview.

“Our office is working tirelessly to ensure that Minnesota’s interests will be served,” Ellison said.

Fairview CEO James Hereford and Sanford CEO Bill Gassen told lawmakers on Tuesday that the merger will improve health care for Minnesotans.

“This merger is a forward-looking step to strengthen our organizations and protect our shared mission as we navigate a rapidly evolving health care,” Hereford said.

In addition to concerns over the University of Minnesota Medical Center, critics are also alarmed about the impact a potential merger could have on abortion and gender-affirming care in Minnesota. Gassen told lawmakers the merger wouldn’t affect those types of care.

University Medical School Dean Dr. Jakub Tolar told lawmakers that the university is opposed to the merger for multiple reasons, including the risk the South Dakota company could change its position on providing abortion and gender-affirming care.

In South Dakota, abortion and gender-affirming care for youth is banned.

Myron Frans, the university’s senior vice president of finance and operations, said the U is trying to gain ownership of the medical center. The university has asked the Legislature for $950 million to buy and operate the medical center on its own without the financial ownership of an outside corporation.

The Star Tribune on Tuesday reported Fairview is willing to relinquish control of the U’s medical center to prevent ownership by Sanford.

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