New River Medical Center exploring affiliation

A nonprofit board associated with New River Medical Center is exploring affiliation with another health group.
The Monticello-Big Lake Community Hospital District board approved a motion June 14 offered by Boardmember Candy Benoit publicly acknowledging that New River Medical Center’s new nonprofit board will pursue potential affiliation.
“It makes sense the nonprofit would get a head start on its district affiliation, hit the ground running and not waste time getting up to speed,” Benoit said.
The nonprofit board will not formally begin operating New River Medical Center until Oct. 1, but the transition has begun to ramp up, said New River Medical Center spokesperson Joni Pawelk.
A task force will study potential alignment with another health system. Its members are district board chair Erv Danielowski and Benoit along with appointed community members Steve Heath and Bob Esse. Boardmember Linda Doerr, who is a vice president at CentraCare Health System, declined a position on the task force. Doerr has also agreed not to become involved with any negotiations with CentraCare.
Allina Health, Fairview Health Services, Sanford Health, CentraCare and North Memorial have all expressed interest in an affiliation with New River Medical Center, Chief Executive Officer Marshall Smith said.
The district board also passed a motion offered by Benoit to make Smith the CEO of both the nonprofit entity that will take over operations in October as well as the hospital district.
One of the reasons the district board chose to pursue a nonprofit structure was to enhance the hospital’s ability to affiliate with another health system, Benoit noted.
While district board meetings are generally open to the public, nonprofit board meetings are not, Pawelk said. Smith has indicated the nonprofit structure allows the board to make strategic decisions without tipping its hand to other health care entities.
The district board would have to publicly vote to approve any affiliation. The district board could choose to reject the task force’s recommendation.
Board members noted the district board explored affiliation in the past but ultimately decided to go ahead with the idea.
Danielowski noted in an interview that he originally preferred to directly pursue affiliation and voted against the nonprofit structure. However, he said the new board would be useful in an affiliation exploration.
“When you go to a 501(c)(3) (nonprofit structure), you just get a second board to help you navigate through the business world out there,” Danielowski said. “We’ve been told from every expert we’ve had deal with us that you’re just going to have to align yourself with another larger system just so you do have access to more doctors so you’re not under the control of a single group of physicians.”
New River Medical Center has had a very public series of disagreements with physicians from Monticello Clinic, who formerly provided hospitalist services at the medical center. The Monticello Clinic doctors took issue with the medical center opening its own clinic, among several other hospital leaders’ actions. Monticello Clinic doctors have refused to refer patients to New River Medical Center. An advertisement by Monticello Clinic cited “a frustrating lack of collaboration between the hospital administration and the clinic.”
With a sharp decline in births at New River Medical Center, the hospital in late May stopped providing obstetrical services, including baby deliveries.
Affiliation with another health system could allow the hospital to bring back baby deliveries as well as provide many other services, Danielowski said.
“It will come back. It has to come back,” Danielowski said of obstetrical services. “That is a service the women of the district deserve and to see that leave was hard for me.”
He indicated affiliation with a larger system would bring stability to the hospital and provide more choices in Monticello.
“We have a large enough population in this area that we should have all sorts of specialists and choices at our hospital rather than having to go to Maple Grove or Buffalo,” Danielowski said.
With affiliation, Danielowski indicated he foresaw a system in which the larger health system would generally run New River Medical Center. He noted an example in Sauk Center in which CentraCare provides the hospital services while the city of Sauk Rapids retains ownership of the buildings.
“That’s kind of what I’d like to see for the district,” Danielowski said. “We’d keep the buildings and real estate but turn over the day-to-day operations to a bigger entity that would be able to bring in more services.”