U regents affirm medical partnership with Fairview

September 28, 2018

The Fairview name will live on under a new agreement between the Twin Cities health system and the University of Minnesota that seeks to elevate the standing of both as medical and research powerhouses.

The U’s board of regents approved an eight-year partnership Friday morning that will rebrand the shared hospitals and clinics under the name M Health Fairview.

The two parties have alternately considered splitting, merging, then splitting again, since forging a partnership more than a decade ago, but Fairview and university leaders said the collaboration recognizes the important roles that each side plays for the other.

The partnership provides a “user-friendly, research-based and science-driven way of getting health care to Minnesotans,” said Dr. Jakub Tolar, vice president for health sciences and dean of the U’s School of Medicine.

Fairview clinics and hospitals will continue to serve as a referral base, sending patients to the university and its specialty care and research programs. The health system also committed to providing $40 million or more per year in clinical revenues to support research. That was an increase from the current amount of $8.7 million annually, and the agreement calls for an additional variable amount of up to $8 million per year in research spending if Fairview generates excess clinical revenues.

The university and its faculty doctors will provide expertise, clout and an academic brand name to Fairview, which was already one of the largest providers of primary care in the Midwest before its 2017 merger with the HealthEast hospital-clinic system.

While the deal might appear to be a “dollar for brand” swap, U general counsel Doug Peterson said it is more complicated. The boosted research funding is based on the assumption that Fairview and university doctors will increase patient volumes and accelerate research discoveries that will improve patient care in the state, he said.

“The point ... is to do the research that helps patients,” he said.

Tolar said the research funding will be concentrated in areas in which the U is already renowned nationally — neuroscience, biomedical engineering and cell therapy.

The university sold its hospitals and clinics to Fairview two decades ago to stem financial losses. The relationship between Fairview, the university, and the University of Minnesota Physicians (UMP) group has been rocky in the years that followed.

The university in 2013 considered breaking from Fairview and aligning with Sanford Health. In 2015, Fairview and UMP engaged in merger discussions that created the M Health brand and sought unsuccessfully to eliminate the Fairview name altogether. In 2016, the sides announced that merger talks had failed and that the university would once again consider other clinical partners.

While the medical school continues to rank among the nation’s best in primary care training, its reputation and funding have slipped as measured by federally supported research. U.S. News World Report magazine recently ranked the school 46th nationally for research.

The new agreement “is significant and puts our medical school in a much more competitive position nationally,” said Brian Burnett, the university’s senior vice president for finance and operations.

Tolar said the university and academic physicians will benefit from Fairview’s expertise as a clinical provider, and focus on patient satisfaction. Wait times of 17 weeks or more to see university physicians need to be a thing of the past, he said.

Some doctors are operating under the “recycled knowledge that the longer your waiting times, the better doctor you are,” he said. “That’s the opposite way that I look at it.”

Jeremy Olson • 612-673-7744

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