Sanford planned merger with Des Moines-based health system to create ‘regional giant’

June 28, 2019

Sanford Health plans to merge with Des Moines-based UnityPoint Health, a move that would create an organization with more than 83,000 employees and more than $11 billion in annual revenue.

“Sanford and UnityPoint are two successful systems intent on controlling our own destiny,” Sanford CEO Kelby Krabbenhoft said in a news release.

“We believe that, in the very near future, fully integrated health systems will drive greater value through affordable options for high-quality health care to patients, governments and employers. The combination of Sanford and UnityPoint will help both organizations better meet this need.”

Krabbenhoft would be CEO following the merger, according to the release.

The Wall Street Journal also reported the potential merger, saying a letter of intent between the two health systems was signed Thursday. Its headline called the merger a “26-state regional giant.”

The deal would create one of the 15 largest nonprofit health care systems in the country. The hope is to finalize it by the end of the year, pending regulatory approval.

The goal of the merger is “to become the destination for personalized primary care in America’s Heartland,” the statement said, adding it follows “considerable exploration between leadership teams from each organization” and an opportunity to build on each’s strengths in clinical care, research, innovation and education.

 

“We will work tirelessly to find the next cures for diseases like type 1 diabetes and breast cancer; train and grow our own physicians, nurses and other medical professionals who commit to providing care in rural America; and offer innovative health and wellness products and telemedicine services to help people live better, get care closer to home and stay healthier,” Krabbenhoft said.

UnityPoint Health is the nation’s fifth-largest non-denominational health system. It was known as Iowa Health System until 2013 and is one of two major players in Iowa.

UnityPoint Health began in Des Moines, when Iowa Methodist and Iowa Lutheran merged to form Iowa Health. At the time, the merger created the state’s largest provider of hospital and related health services. Since then, UnityPoint Health has grown to encompass eight major geographic regions in Iowa and Illinois.

It calls itself one of the nation’s most integrated health systems, with locations throughout Iowa, Illinois and Wisconsin. According to the system’s website, care is provided through relationships with more than 900 physicians and providers working in more than 280 UnityPoint clinics, 32 hospitals in metropolitan and rural communities and home care services.

The nine regions within UnityPoint Health, which are named for the largest city within that region, are:

  • Cedar Rapids, IA
  • Des Moines, IA
  • Dubuque, IA
  • Fort Dodge, IA
  • Peoria, IL
  • The Quad Cities
  • Sioux City, IA
  • Waterloo, IA

“We are approaching our discussions very purposefully, with a clear and common vision for success,” UnityPoint president Kevin Vermeer said in the news release. “First and foremost, our focus is on people. Working together, we will find new ways to broaden access to care — beyond the traditional settings — and take greater responsibility for the health of the populations we serve.”

Vermeer would become senior executive vice president of the new, combined company.

A new governing board would be established for the new company, made up of representatives from both legacy organizations, plus additional unaffiliated board members with relevant national industry experience and expertise. UnityPoint Health would recommend the inaugural board chair.

Krabbenhoft hinted at potential merger and acquisition activity earlier this year.

“At 30,000 feet, there’s an amalgamation of 25 to 30 health systems in the country right now, and Sanford is one and emerging higher all the time,” he said at the time.

Krabbenhoft talks domestic, international growth strategy as Sanford builds relationships

Sanford planned merger with Des Moines-based health system to create ‘regional giant’

Sanford Health plans to merge with Des Moines-based UnityPoint Health, a move that would create an organization with more than 83,000 employees and more than $11 billion in annual revenue.

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