Fairview Health Services has dropped out of the Minnesota Hospital Association, and uncertainty surrounds the situation.
Fairview, a Minneapolis-based academic health system which is operating without a permanent CEO, did not explain why it left the state's hospital trade group, only saying in a statement that it discontinued its membership and “will re-evaluate participation in 2017.” Fairview declined to make anyone available for an interview.
Wendy Burt, a spokeswoman for the Minnesota Hospital Association, confirmed that Fairview had dropped its membership. The association received a letter from Fairview on March 7. Neither Fairview nor the MHA provided a copy of the letter.
“We are disappointed about this, of course, and hoping they return,” Burt said in an e-mail. She directed other questions to Fairview.
Fairview's departure from the MHA represents a tumultuous event for the state, considering the system's size and scope. Fairview is one of the MHA's largest members, although the amount Fairview paid in dues was not disclosed. The health system has about $3.4 billion in annual revenue, according to Modern Healthcare's financial database, and fully owns six hospitals, including the University of Minnesota Medical Center in Minneapolis.
Fairview is also in the process of merging with the University of Minnesota Physicians (PDF) group, and recently acquired 100% of PreferredOne, an embattled health insurance company that exited the state's Affordable Care Act exchange. Many health systems have looked at acquiring or starting their own health plans to align care delivery goals with payment.
“The withdrawal of an organization the size and substance of Fairview is a serious, serious issue for the hospital community and the future of the hospital association,” said David Feinwachs, former general counsel for the MHA, who was fired in 2010 after raising questions about the state's Medicaid program. “This is not some little insignificant event.”
“This is, at the Minnesota level, no less than United pulling out of AHIP,” Feinwachs added, referring to when health insurance giant UnitedHealth Group parted ways with industry lobbying group America's Health Insurance Plans last year. Aetna also left AHIP, raising questions about AHIP's influence during the ACA's growth years.
Fairview's exit from the state association also comes at a time of disorder and change within the health system. Even though it is in the process of integrating a major physician group and an insurer, it still doesn't have a permanent CEO to oversee those efforts. CEO Rulon Stacey left last year because of a “combination of professional differences and personal reasons,” the system stated. David Murphy, Fairview's board chair and the former CEO of a shoe company, remains as the interim chief executive.