Essentia Health plans to merge with and operate under the name of HealthPartners, another Minnesota-based nonprofit health system.
Essentia Health is not a Catholic health system but five of its hospitals and one rehabilitative center are Catholic facilities. Essentia Health spokesman Anthony Matt said those facilities will retain their religious affiliation after the merger and adhere to the Ethical and Religious Directives for Catholic Health Care Services. HealthPartners is a secular health system.
The two systems' boards of directors announced Sept. 29 that they approved a merger agreement effective Jan. 1.
Essentia Health is based in Duluth and HealthPartners in Bloomington. The combined system will encompass 22 hospitals and more than 135 clinics across Minnesota, North Dakota and Wisconsin. The workforce will number about 45,000, including more than 6,000 clinicians serving about 2 million patients and 1.6 million insured members. No cuts or closures are part of the plan, Matt said.
"Our organizations share similar missions and values, deep roots in this region, and a focus on improving health and well-being," Essentia Health CEO Dr. David Herman said in a press release. "As a combined nonprofit health system, we will be able to better innovate and grow our workforce. That strong foundation will make us even better partners for our patients, working together to help people live their healthiest lives, wherever they call home."
Herman, who has led Essentia Health since 2015, will serve as president of combined clinical care group operations after the systems merge.
HealthPartners President and CEO Andrea Walsh will lead the unified system. "This combination is about doing more for the people and communities who count on us," Walsh said in the release. "HealthPartners and Essentia Health share a belief that everyone deserves access to high-quality care and coverage, close to home and centered on their needs."
A website set up to explain the merger noted that the healthcare industry "is facing significant financial headwinds." Aging populations and growing illness rates are increasing demand for care, and costs continue to rise faster than reimbursement, it said.
"We are two healthy, growing organizations with complementary strengths," it says. "Combining our capabilities and resources will create a stronger platform to innovate, improve affordability and keep high-quality care close to home, with local needs and relationships at the center."