Sanford Health CEO talks about Marshfield Clinic merger and potential for more growth

After completing one of the largest hospital mergers in the past year, Bill Gassen likes what he sees.

Bill Gassen, president and CEO of Sanford Health, says he's excited about the recent acquisition of the Marshfield Clinic Health Systems. He also says Sanford is open to deals with other hospitals.

Gassen, the president and CEO of Sanford Health, speaks enthusiastically about its merger with the Marshfield Clinic Health System, based in Wisconsin. With the deal, Sanford has grown into a system with $11 billion in revenue.

Based in Sioux Falls, South Dakota, Sanford operates 56 hospitals and more than 200 clinics across the rural Midwest, along with two health plans serving more than 425,000 people.

In an interview with Chief Healthcare Executive®, Gassen says he’s pleased at the progress of the integration of Marshfield Clinic.

“I could not be more excited,” Gassen says. “The vision that we had together between Sanford Health and Marshfield Clinic Health System is really starting to come to fruition already. The teams are working really hard right now on integrating the two organizations together, but even in the very early months, we've seen incredible advancements, and probably most importantly has been that cultural alignment.”

Even as Sanford has grown into a large organization, Gassen says that the health system could get even bigger in the future. Sanford is open to merging with other hospitals if the right opportunities arise.

“I'm certain that Sanford Health will continue to grow with other strategic, like-minded partners,” Gassen says. “And as we do that, we just want to make sure that we are very careful to make sure that we find partners like Marshfield Clinic Health System.”

Gassen says other partners would need to have strong innovation, physician leadership and a commitment to research and education.

“Those are core components to ensure that we're providing world-class care to every single one of our patients. And as we find those strategic partners who are committed to that vision for the future, we will always welcome those conversations and work with them and work with their communities to see if what we see together is the right fit,” he says.

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$500 million commitment

Sanford Health and Marshfield Clinic initially announced plans to come together in July 2024, and they completed the deal in January.

Over the next five years, Sanford is investing $500 million in improvements to Marshfield Clinic. Sanford is also moving Marshfield Clinic’s hospitals and other facilities onto Epic’s electronic health record system. Gassen expects it will take two years to complete the transition of Marshfield Clinic’s electronic health records.

“The teams are in the process of doing the planning and the design work to prepare to begin that conversion,” he says.

Sanford has experience in converting electronic health record systems, which has helped the process.

“One of the things that we've really learned through that process is that the planning on the front side is as important as anything, and so the teams are really working hard right now to set that up, to have that be a very positive conversion that ends up being a great asset for our clinicians as well as our patients,” Gassen says.

Gassen says he was confident that Marshfield Clinic would be integrated successfully, and he sees important similarities in their philosophies.

“The largest factor in the successful combination between the two organizations is really that cultural alignment. And in the very early stages of the conversations, both at the management team level and the board level, it became very clear that both organizations had a strong alignment relative to mission and culture, and that has carried us through closing and now into the integration planning,” Gassen says.

“Both organizations firmly believe that, at the end of every decision we make together, is a patient,” he adds. “And that's really been a galvanizing force for us as we've gone forward to make the hard decisions about, how do you take two incredibly gifted organizations with 100-year-plus histories and bring them together, so that one plus one equals three, four and five.”

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'Serving America’s heartland'

Both Sanford and Marshfield Clinic serve fairly similar markets. Sanford serves patients in South Dakota, North Dakota, Minnesota and Iowa. Marshfield Clinic, based in Marshfield, Wisc., operates across Wisconsin and Michigan’s upper peninsula. Even with the completion of the merger, Marshfield Clinic has retained its brand in its market.

“At the outset, we're very optimistic about what we would be able to do together. But part of that optimism is really derived from understanding the respective capabilities and strengths of organizations,” Gassen says.

He points to Marshfield Clinic’s strong tradition of physician leadership and innovation. He also says Marshfield Clinic understands the importance of a provider-led health plan. With the merger, Sanford adds Marshfield’s Security Health Plan to the Sanford Health Plan.

Gassen says Sanford is already starting to see benefits in synergies between the two health plans.

“What that's really doing is allowing us to bring more opportunities and more choices to the market that allow our patients and members to have more options for their care,” he says.

Gassen also cites Marshfield Clinic’s “real, deep commitment to serving America's heartland, to providing world-class care in rural America, across the upper Midwest.”

With those strengths, Gassen sees “incredible opportunity and synergy as we bring together both organizations.”

'It feels like home'

Even with Sanford now encompassing a large geography with more than 50 hospitals, Gassen says he’s not concerned about overseeing so many different facilities.

He says he’s optimistic about the prospect for success, which he says will be measured by improved access, quality and sustainability.

Gassen also expresses confidence in the leadership at Marshfield Clinic and its facilities. He notes that Sanford’s key geographic markets have their own president and CEO. Brian Hoerneman, who had been serving as interim CEO of Marshfield Clinic, now serves as president and CEO of the Marshfield Clinic region of Sanford Health.

The leaders of Sanford’s markets are the face of the organization in their communities, and are advocating for their clinicians and patients, Gassen says.

“We know that health care should continue to be local,” he says.

Gassen also says he’s happy to hear a recurring sentiment from leaders at both Sanford and Marshfield Clinic.

“For many of our clinicians and our leaders who spend time now in both markets, they constantly come back and say that it feels like home,” Gassen says. “And that's a phrase that really rings true to us. As we had the opportunity to spend time in their hospitals, to spend time in their clinics, to spend time talking with their physicians, for me personally, every time I walked away from one of those discussions, it felt very comfortable.”

Coming tomorrow: Sanford Health’s CEO discusses the challenges of providing healthcare services in rural America