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Intermountain, Sanford Suspend $11B Merger

Analysis  |  By Jack O'Brien  
   December 04, 2020

The decision comes weeks after Sanford's longtime CEO Kelby Krabbenhoft resigned from his position.

Sanford Health and Intermountain Healthcare suspended their merger plans Friday evening following the resignation of Sanford's longtime CEO Kelby Krabbenhoft a few weeks ago.

Bill Gassen, Sanford's new president and CEO, said the organization paused its merger plans and intends to focus on "other organizational needs."

"With this leadership change, it’s an important time to refocus our efforts internally as we assess the future direction of our organization," Gassen said in a statement. "We continue to prioritize taking care of our patients, our people, and the communities we serve as we look to shape our path forward."

Related: Sanford Health Finance Exec on System's Preparations for COVID During Flu Season

Intermountain addressed the decision in a statement.

"We are disappointed but understand the recent leadership change at Sanford Health has influenced their priorities," Marc Harrison, M.D., CEO of Intermountain, said in a statement. "There’s much to admire about the work that Sanford Health is doing. We continue to share a strong vision for the future of healthcare." 

Sanford Health and Intermountain Healthcare announced plans to merge at a late October press conference.

The executive board of trustees of nonprofit systems approved a resolution to support moving forward with the due diligence process.

The combined system was expected to employ more than 89,000 people, operate 70 hospitals and 435 clinics across seven states, according to a Sanford press release. Additionally, the system was expected to provide senior care and services in more than 360 locations across 24 states and insure 1.1 million people.

However, in mid-November, Krabbenhoft issued an email to Sanford employees after stating that he had recovered from COVID-19 and would not be wearing a mask.

Shortly thereafter, Krabbenhoft resigned from the office he had held since 1996.

Related: Intermountain Telehealth: A Million Virtual Connections and Counting

Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.

Photo credit: Photo courtesy of Intermountain Healthcare

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