Oct. 17, 2022

Paul Hanson figures this is as good a time as any to just laugh.

So when it became time for the president of Sanford Health Sioux Falls to assume his term as chair of the Greater Sioux Falls Chamber of Commerce – which he’ll do officially at the organization’s annual meeting this week – Hanson eschewed a standard keynote speaker in favor of a comedian.

Charlie Berens, an Emmy-winning journalist, comedian, host and creator of the Manitowoc Minute, will entertain the crowd at Tuesday’s event.

“I guess from my perspective, we’re coming together as a pretty large group of business professionals and community leaders at this annual event. How about we just have some fun?” Hanson said. “We’ve gone through two really tough years with COVID, post-COVID, we’ve got workforce issues, housing considerations … how about we just enjoy some good laughs and fellowship?”

Hanson has lived those challenges as acutely as anyone, from navigating patient surges to workforce shortages, inflation impacts and the need to keep building and hiring despite mounting expenses.

On some level, this was exactly what his teenage self was trying to avoid in a career, growing up in the community of Galesville in western Wisconsin, which he estimates was a town of about 800.

“I knew I didn’t want to be a pharmacist,” he said. “My dad had a tough experience running a small pharmacy in a small community during the late ’70s, early ’80s and had to shut down a store. The revenues weren’t keeping up with expenses, labor issues, high interest rates, workforce issues.”

His most powerful experience with health care, though, came in elementary school when his mother was hospitalized for 90 days following a cerebral aneurysm. It came into play when a neighbor later encouraged him to consider a health care career.

“I was around hospitals a lot. I wasn’t fearful of hospitals, and it was a natural fit,” he said.

He worked as a nursing aide, in medical records and in a business office while in high school and at Concordia College, where he earned degrees in hospital administration and long-term care.

It led him to his first job in Montana for a 16–bed hospital and 40-bed nursing home — as CEO. He was 22.

“You don’t know what you don’t know,” he said. “I was really fortunate I had a lot of people who took me under their wing.”

From there, he transitioned to Glendive, Montana, located near the North Dakota border, at an institution that was two or three times larger and had just lost 10 physicians at the same time. His primary role became recruitment, partnering with a local physician group to bring more doctors to the region.

An opportunity to lead Prairie Lakes Healthcare brought him to Watertown in 2000, where he first became part of then-Sioux Valley Hospitals & Health System, which managed Prairie Lakes. Nine years later, he became president of Sanford Health in northern Minnesota, based in Bemidji, before succeeding Dr. Charles O’Brien as president in Sioux Falls in 2013.

“I observed that he had a solid grasp of the operations of a very complex and complicated business,” said former CEO Kelby Krabbenhoft, who promoted Hanson. “He understood the critical role of nursing and related caregiver positions throughout the system.”

Hanson proved trustworthy, with “very good communication skills and a gentle sense of humor,” Krabbenhoft said. “I was proud to have his back.”

Calling Hanson the head of Sanford’s Sioux Falls region is a bit of an oversimplification.

His area of oversight goes as far west as Winner and Chamberlain, north to Aberdeen, south to Vermilion and east into southwest Minnesota and northwest Iowa.

Ultimately, Sanford Sioux Falls encompasses $2 billion in net annual patient revenue. Like nearly every health care organization of its kind in recent months, “our revenue line has not kept up with our expense line,” Hanson acknowledged. “That’s why it’s so important for us to manage labor, to manage financial resources and to create efficiencies in our system – access point that might be better for patients and cheaper for us to create.”

Despite a more than 30-year career in health care, Hanson has not experienced a market like this – “that has interest rates that are spiking the way they are, supply-side shortages, workforce issues that are extreme and just maybe more disrupters within the marketplace where you’ve got other for-profits looking at trying to enter into the health care arena but getting into it where they don’t have the ultimate responsibility of taking care of all aspects of the patient’s care. We’re here 24/7, 365 days a year, and that expectation has huge responsibilities for any health care organization like ours,” he said.

“The good news is we have phenomenal people who know how to roll up their sleeves and get the job done and do it in such a way that we don’t lose anything with the patient relationship, and the quality outcomes we have are being benchmarked against the best of the best, and we’re performing very well.”

Serving a community and region growing as Sioux Falls is also requires continued investment. When Hanson goes to work on the campus of Sanford USD Medical Center, he’s surrounded by construction as a daily reminder.

A new building focused on gastroenterology while adding parking to the campus is scheduled to open in the spring of 2024, while the nine-story, 205,000-square-foot Sanford Orthopedic Hospital will be done sometime in 2025.

Both are designed with an emphasis on outpatient procedures while providing proximity to inpatient care if needed.

“We needed to have that additional space,” Hanson said. “We have a lot of growth and development in our community and greater region in terms of who we feel we are responsible for for care.”

While the buildings still are years away, the need to add providers has been pressing in the short term as surgeons have departed Sanford both in orthopedics and vascular.

“We’ve been able to basically replace our vascular group in a relatively short amount of time with really good, competent people who are engaged in other specialties, and we think the people we brought in are going to be really, really well received,” Hanson said.

The orthopedic surgery line peaked in 2021 after 18 years of building, he added.

“A few orthopedic surgeons chose to stay in town or work elsewhere or go out of our community, and we’ve been able to replace them with really good people,” Hanson said.

“They’re coming here, they’re practicing, they like the vision of where orthopedics is going. So in 18 months, we’ve replaced, and we’re two shy from the high where we were before, so that’s a good indication how fast we can recruit competent people who want to come here and be part of our team and see the opportunity.”

There aren’t many leaders who run organizations as large as Sanford Sioux Falls who also serve as chamber chair.

“I think when a community has given so much – and the community of Sioux Falls has given the Sanford Health organization so much – there is a responsibility that our organization has to give back … and there is a sense of responsibility our executives will give back to the community.”

For Hanson, the role on the chamber board gives him a “much different perspective of the wants and needs that small businesses are going through,” he said. “I view it as a connection for me to the community, to small business and larger businesses within the community but also to see what issues are affecting their businesses, whether it be workforce housing, child care, there’s just a number of things that come up, so if we can collectively come up with a solution to those things, everyone benefits.”

The chamber has 1,901 member businesses, “which places us in the 99th percentile of chamber groups our size,” Hanson said. “Which is pretty amazing. We had a net gain in our membership year over year, which I think says a lot about the community of Sioux Falls.”

His challenge to the organization as he becomes chair: Reach 2,000 members while continuing to work on community issues, including housing and workforce.

“I think if we can keep working those partnerships, enhancing those partnerships, the chamber becomes that much more valuable to every member,” he said.