AP NEWS

DMC born from coffee chat 11 years ago

March 26, 2019

EDITOR’S NOTE: Portions of this article previously appeared in the Post-Bulletin. The interviews took place in 2014 and 2017.

Destination Medical Center is such a common phrase in Rochester today that it’s hard to remember that the initiative has only been publicly known for a little more than six years.

The origin of the concept that eventually evolved into the $6 billion DMC initiative dates back to a chat at a Virginia conference center about 11 years ago.

That conversation was in March 2008 at Mayo Clinic’s National Symposium on Health Care Reform in the Landsdowne Resort in Leesburg, Va.

The place was bustling with national leaders in the medical industry. However, not everyone at the conference worked directly in health care.

Mayo Clinic flew out two Rochester business leaders — John Wade, then-president of the Rochester Area Chamber of Commerce, and Bruce Fairchild, then regional director of Interstate Hotels in Rochester — as guests.

Since November 2007, four months earlier, Wade and Fairchild had been talking about developing a plan to bring the community and its largest employer into sync to more efficiently serve the thousands of people who stream into Rochester each year to be treated at Mayo Clinic.

Inspired by the symposium, the pair decided to share their ideas with a top Mayo Clinic executive.

They asked to meet with then-Mayo Rochester CEO Dr. Glenn Forbes, without much hope that he would have time for them. Forbes was the top Rochester leader from 2006 to 2009.

Forbes ‘very collaborative’

“But true to form, Dr. Forbes took the time, and we had lunch together,” said Wade in a 2014 interview. “His very nature is to be collaborative.”

The three met in a restaurant at the conference center, and their lunch meeting unexpectedly turned into a very long one.

It started with “blue sky brainstorming ideas,” said Fairchild. But the talk quickly picked up momentum.

“We were getting increasingly excited about the possibilities,” said Forbes in 2014. “The ‘lunch’ went over several cups of coffee for about two and a half hours.”

One of the starting points was a familiar fact of life in Rochester. Mayo Clinic far overshadows any other employer or company in the city. That lack of economic diversity makes the city vulnerable to changes in the health care industry.

The trio reversed that to look at it from a different angle.

“We flipped that idea. It’s not just a risk, but a unique opportunity,” said Forbes. “Rochester is just the right size to form a unique collaboration and partnership to develop something very special … If we continue to refine it, continue to develop it, it would be unmatched anywhere in the world.”

It all boiled down to having the clinic, local businesses and the city work together to create the best possible experiences for patients visiting Rochester for treatment, as well as for the people traveling with them.

Word of mouth is key

Wade said Forbes framed the concept with the the story of a patient who returned home to Peoria, Ill., after spending time in Rochester at Mayo Clinic.

“When the neighbor asks over the backyard fence how it went, the next words out of their mouth is crucial,” said Wade.

No specific details arose out of the brainstorming lunch, though Forbes remembered they roughed out three basic principles. They were:

• Any collaboration would need to be an equal partnership. It shouldn’t be controlled solely by Mayo Clinic or by the City of Rochester, but jointly by both.

• This would work best, maybe only work at all, if it started by focusing on the patients coming to Rochester.

• Neither the community nor Mayo Clinic had ever really focused on the people that accompany the patients. More information was needed about those non-patients and what they wanted from Rochester.

“We hadn’t really ever talked a lot within Mayo or within the community about who are these people and what can we do for them while they are here,” said Forbes. “They never registered at the clinic; they were below the radar.”

By the the time Forbes, Fairchild and Wade finally left the table, they had crafted the foundation of what would eventually evolve into the Destination Medical Center initiative. The conversation continued at the airport as they waited for their plane. And they talked even more during the flight.

Back in Rochester, Wade and Fairchild started testing support in the business community. Forbes took the concept to Mayo’s leaders.

‘Unparalleled experience’

Mayo Clinic’s Rochester Board of Governors met for an annual retreat over the weekend of Sept. 22, 2008, at the St. James Hotel in Red Wing. The theme for the meeting was “Providing an Unparalleled Experience as a Unique Destination.”

One topic put on the agenda by Forbes was “further differentiation of Mayo Clinic as a destination medical center.” Following that retreat, a strategic planning work group was put together at Mayo Clinic in October 2008 to start looking at the goal of “unparalleled experience.” That early group included Forbes, Dr. Dick Ehman, Steve McNeill, Winston Stellner and others.

Jeff Korsmo, then chief administrative officer of Mayo Clinic, was a key member of the group.

Korsmo remembers when he grasped the concept of DMC. He and Dr. Ehman were talking about the project in Room D on the 11th floor of the Mayo Building.

“He’s a really great thinker. For me, the light bulb came on as he talked,” said Korsmo. “He said, ‘We believe we’ve created a really outstanding experience within the walls of Mayo. Of course, we’ve got to keep making it better and better. But we really have not been engaged as we could be in making sure the experience of patients and their families is as good as it could be … in every aspect.’”

Korsmo particularly liked the idea of Mayo Clinic working closer with community members and businesses such as the now-closed Michaels Restaurant and the Canadian Honker.

“They (Rochester businesses) felt as much a part of Mayo as any of us. We haven’t worked together as well as we should have,” he said. “I grew up in Rochester hearing about ‘Fortress Mayo.’ I wanted to help change that.”

Before the board’s discussion at the Red Wing retreat, Korsmo attended a Mayo Clinic event on Sept. 8, 2008, at the Red Crown Lodge in Arbor Vitae, Wis.

While there, he spent some time chatting with Red Crown Lodge’s owner, Bob Dunn. Dunn is also the president of Hammes Sports Development, a Madison, Wis.-based development and consulting firm that works in the health care, hospitality and sports industries.

That and other conversations led Mayo Clinic officials to go Dunn’s office at Hammes in early October 2009 to work on the idea.

“We’ve been around for a long time. I think we’ve been an important part of helping to not only create the vision, but also organize the plan to execute the DMC, the whole transformation that you are now starting to see,” Dunn said in 2017.

The early strategic planning group worked through February 2009 on crafting the core vision of DMC. More community members became involved along the way.

“It really began to snowball,” remembered Korsmo.

Forbes placed Korsmo in charge of a steering committee of 30 area leaders and Mayo Clinic executives. Forbes and Wade served as vice chairs. Other members included Fairchild, then-Mayor Ardell Brede, Lisa Clarke of Mayo Clinic, Jon Eckhoff of the Rochester Downtown Alliance, Don DeCramer of Mayo Clinic, then-Post-Bulletin Publisher Randy Chapman and Tessa Leung of Sontes restaurant, now Grand Rounds.

Committee participants were asked to sign non-disclosure agreements.

“When we brought research together, we just asked people to come to really discuss what this could mean without sharing it. It was a first-blush analysis,” said Clarke. “In my mind, that’s natural” to keep the information private.

Back to Red Lodge

A group of Mayo Clinic leaders went back to Red Lodge in the first week of June 2009 to “concept” the idea of DMC with consultants of Hammes. They also went to Dunn’s Madison office in early October to work on the idea.

The steering committee was rolling along and a separate group at the Rochester Area Chamber of Commerce was working in tandem with it.

Fairchild said the steering committee was getting together more and more often until it was officially meeting every other week.

“Sitting at that table with some really bright minds was one of the best experiences in my life,” he said.

Meanwhile, the downtown master plan was being created for the City of Rochester. The DMC group provided input for that plan, so the strategic efforts would be in sync. The downtown plan was then adopted by the city in August 2010.

Clarke, the executive director of the DMC Economic Development Agency, said that the “visioning phase” of the DMC initiative began in 2010. About 22 “visioning” statements” were created.

“We started preliminary discussions then,” she said. “We brought people together to answer, ‘What could this mean?’ Those were great discussions.”

‘Research Phase’

In 2011, what Clarke calls the “research phase” of the project began. Northwestern University was brought in to interview patients and study the concept. That took place over a four- or five-month period.

Hammes, which was officially contracted by Mayo Clinic in 2011, was also involved in this phase of the creation of DMC.

Those interviews resulted in a series of profiles of “typical” Mayo Clinic visitors. Forbes showed some copies of those amalgam profiles with titles like, “Generation Loyals,” “Health Care Nomads,” “Pass Throughs,” “Royals” and others. “We wanted to understand what the patterns of people were, understand what people are interested in and then try to figure out where the gaps are in the experience in Rochester,” said Clarke.

Hammes Co. Sport Development, Inc., a division of Hammes Co., signed a contract with Mayo Clinic for $2.3 million in February 2014 to serve as the development manager for DMC. Hammes also was hired by Mayo Clinic in 2015 for $1.5 million, to analyze the Discovery Square piece of the DMC vision and offer a market plan of how the medical and technology research area might be developed.

“I think Rochester will be a case study in America 10 years from now on how you build the city of the future. We’ve made a big investment here and I’m prepared to make an even larger investment here,” stated Hammes’ Dunn in 2017. “I think we know the market as well as anyone can know it and understand it, given all of the work we’ve done. Our time here in Minnesota is only going to continue. This is a community we’re very focused on now.

Made public in 2012

Following the research phase was a “thoughtful” strategy phase, Clarke said. Then the DMC legislative phase began in 2012. That’s the stage where the majority of Rochester became aware of the project.

Before the city’s vote in November on the issue, DMC was one of several projects earmarked for $20 million from the local option sales tax. Despite not releasing any details of how the money would be used or even any details of what the Destination Medical Center initiative entailed, intense campaigning by local officials drove Rochester to voters approve the sales tax.

It turned out that what the public was told about DMC up to that point was just the tip of the iceberg. The rest surfaced soon after.

In January 2013, the $6.5 billion DMC plan was unveiled in the Governor’s Reception Room in St. Paul. Soon after, it was put into legislative form. By late spring, it had passed both chambers of the Legislature and was signed by Gov. Mark Dayton.

For the men who were there for that 2008 conversation in Virginia, it has been a long journey that John Wade describes as “evolutionary” for the community.

“We’re all in this together. Today we are far better aligned than ever before,” he said. “What we have today is what we didn’t have 20 years ago … a plan.”