Board, Fairview end merger talks

U physicians and Fairview hoped to share benefits, including clients and technology.

Eliana Schreiber

After nine months of negotiations, a merger between University of Minnesota Physicians and Fairview Health System was nixed last week.

The University’s Board of Regents last Wednesday terminated a letter of intent from last October that would have combined the two health care providers in an attempt to share benefits, including UMP specialists gaining a larger client base from Fairview, as well as University medical specialists and technology being at Fairview’s disposal.

The University of Minnesota Physicians’ — the group that oversees University doctors’ private practice — Board of Directors voted to terminate their letter of intent, effective July. 1.

University President Eric Kaler said the board gave Fairview its final offer on Jun. 8, with significant compromise for both sides. Fairview’s Board of Directors rejected the proposal Jun. 29.

For many board members, an integrated health system would greatly benefit the community, physicians and faculty, Kaler said. 

“Regardless of what happens with this current effort, Fairview will remain a critical partner of the University,” he said at the meeting.

In an emailed statement, a Fairview spokeswoman said the two institutions will continue to work together and that current agreements between the University, University Physicians and Fairview remain intact. 

“Our Board was not confident that the new organization would be able to realize the overall vision and original goals of the integration,” the statement said. 

The current affiliation between Fairview and the University will remain intact, he said, despite the organizations’ inability to agree to terms to merge under the M Health name.

“We believe that the agreements on the table are fair,” said University of Minnesota Physicians CEO Dr. Bobbi Daniels at the meeting.

Daniels said the agreement would have improved the medical school’s research, clinical care and overall education and said she was disappointed to see negotiations fail.

Some regents expressed similar frustrations.

Regent Richard Beeson said the failure of the merger comes after hundreds of hours of negotiation.

“I am angry with … this last-minute withdrawal from Fairview,” he said. “[It’s] something that’s been in the works a long time.”

While Regents voted unanimously to kill the letter of intent, Regent Patricia Simmons said she is hopeful for relations with Fairview in the future.

“This would be wonderful,” she said. “We are still people who hope that the right thing happens here.”

Meger talks between the University and Fairview from a previous takeover proposal stalled in 2013.