A wave of hospital mergers is changing healthcare in Minnesota. Why now?

MINNEAPOLIS — In the past year alone, three Twin Cities-based hospital systems have announced plans to merge with systems outside of the metro: HealthPartners with Duluth-based Essentia, North Memorial with South Dakota-based Sanford Health, and Allina with California-based Sutter Health. Why are the mergers happening now? And what will be the impact on patients? What seems like a sudden surge of healthcare mergers in the region is neither sudden nor unique to Minnesota, said Geoff Kaufmann, who teaches healthcare management at the University of Minnesota. “It’s happening everywhere,” he said. The biggest driver, said Kaufmann and other experts interviewed for this story, is financial pressures on hospitals’ bottom lines. Between 2019 and 2024, the cost of delivering care in the state rose 30%, according to a report released in October by the Minnesota Hospital Association. Overall, nearly a third of hospitals statewide are losing money.

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