Sanford-Fairview merger would be bad for Minnesota health care

December 19, 2022 7:00 am

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Fairview Health Services and Sanford Health announced their plans to merge last month, and we can expect their paid talkers to provide the corporate ooze of benevolence. They’ll tell us the merger is a chance to offer higher consolidation of care, improve quality of care and coordination of care, and save health care dollars. The two companies have our community’s public health at heart. 

Only a gullible fool would buy into such nonsense. Positive rhetoric does not outweigh hard facts about receiving health care from large corporate, multi-hospital systems that employ their own physicians, such as Fairview and Sanford. This deal could raise the price of our health care, from the deductibles to the pharmacy costs, while failing to deliver better care. Larger is not better. As a physician and consumer of health care, I hope our attorney general, governor and legislators consider:

  1. Multi-hospital physician practices have market power given their size, and raise the price of services to both consumers and insurance companies. Market power enables the corporate system to negotiate higher prices for physicians, hospitals, pharmacies and therapies within  their umbrella. The cost of care is higher in these systems. Fairview merging with Sanford crescendos their market power. 
  2. Large, hospital-based systems exploit health care dollars by shifting the site of service to a hospital campus, artfully billing both a physician fee and a facility fee. Consumers, therefore, have higher out-of-pocket costs. 
  3. These large networks capably lock consumers into one system: their system. This includes everything from pharmacies to hospitals, primary care clinics, use of urgent cares and where your MRI is done. There is diminished flow into other systems, such as the clinic closer to your neighborhood.  
  4. Mega-health care companies expertly control the referral flow. There is a greater volume of specialty referrals within these systems, thus incurring higher health care costs. 
  5. The size of these corporations has eliminated competition within regions. The Twin Cities, for example, is largely controlled by three systems: Fairview Health, Allina Health, and Health Partners. All three have affiliated insurance companies. 
  6. Multi-hospital health systems incur 19.8% higher expenditures than physician-owned organizations. 
  7. The physician-patient engagement has been devalued. Money drives your care when you visit your doctor. Health plans have effectively decreased the length of face-to-face encounter time and increased overbooked appointments. Physicians’ schedules are so tight that they tend to look at the computer more than you. The human factor has slipped away, replaced by the almighty dollar and “efficiency.” As a physician, looking at the patient enhances clinical judgment. Money efficiency does not necessarily enhance medical problem-solving.  
  8. Data regarding the quality of health is not better with hospital-based corporate care. It is not proven that these companies deliver better quality of care.  
  9. Life expectancy in the United States has declined in the past ten years. Congratulations, the United States of America ranks 40th in the world! The past ten years correlates with the growth of these large systems.  
  10. Out-of-control health care costs outpace wage growth. Health spending increased by 87% from 2000 to 2019. The median household income increased by 10%. We all feel the pinch.  

The cost of worker burnout and the financial burden of health care costs carried by Minnesota families is on the line. A larger system is not the answer. Fairview is a perfect example.  

Minnesota has a chance to be a national leader, and address the issue of integrated hospital and physician-owned networks, which have behaved unconscionably with our health care dollars and quality of medical care. It is high time we look at real statistics, numbers generated by reliable outside sources to guide our health into the future.  

Legislators, roll up your sleeves. People, write to your local officials. Allowing this merger will only make things worse.  

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Elisabeth Slattery, M.D.
Elisabeth Slattery, M.D.

Dr. Elisabeth Slattery is a graduate of the University of Minnesota Medical School and completed her Internship and residency at Hennepin County Medical Center. She’s worked as a clinician and hospitalist, plus a stint in the Sudan serving Eritrean refugees. Originally from Chicago, she resides with her husband in St. Paul and is the mother of five grown children. Slattery is an avid cyclist, swimmer and yoga instructor.