Mayo Clinic is in the very early stages of overhauling its governance model for its facilities across southeast Minnesota. The targeted transition is 18 months away — January 2018 — but the early dialogue is already creating confusion and friction in at least one local community.
The new governance model would center around the creation of an "integrated regional board working in concert with local community boards" in Rochester, Lake City, Cannon Falls, Red Wing, Owatonna, Faribault, Austin and Albert Lea, according to Mayo spokeswoman Asia Zmuda.
That message has not yet been widely communicated — some communities may not even know yet, according to Mayo Clinic Vice President Bobbie Gostout, who heads Mayo Clinic Health System. The planned change represents a significant departure from the current governance model, in which each host city has its own board to discuss local issues.
Establishing a regional board would align Mayo's governance structure with its integrated operating structure, according to a Mayo statement. During the past several years, Mayo has focused on sharing resources across the system.
"To support this integrated operating environment, we need a governance structure that can take a regional view of our services, our clinic and hospital capacity, and the present and future health care needs of our region's population," said Dr. Tom Witt, CEO of Mayo Clinic Health System in Cannon Falls, Lake City, and Red Wing. "This regional perspective, combined with the unique insights of local representatives, will help us to strengthen our health care services at each of our locations."
The move has been prompted by changes within the health care industry, adapting to the needs of local communities and cost concerns, Gostout said.
But the Lake City City council hasn't been receptive to Mayo's early overtures, with city council member Russell Boe saying, "There is some concern that this isn't what's best for Lake City."
"I think there's conflicting best interest," Boe said. "In this case, what's best for Lake City isn't what's best for Mayo Clinic. I think it's sort of a logical conclusion, but Lake City has some protections now."
Lake City raises concerns
Lake City spent more than a year negotiating terms that set up the local governance board with Mayo before signing a 30-year contract in 1998. The 100-page agreement details how major changes — such as last year's decision to discontinue baby deliveries — requires a seven-vote super-majority of the nine-member board before Mayo can take action.
The Lake City board consists of five Mayo reps and four Lake City reps, including Mayor Joel Beckman, which means at least two community members must support Mayo's proposed changes for them to take effect.
Mayo informed Lake City in March of its intent to request changes to the contract. The changes would involve making the local board a committee of the regional board in a way that "maintains the spirit of the agreement," according to Mayo. That's the first step toward making Mayo's planned regional governance board a reality.
Former Lake City attorney Phil Gartner, who helped negotiate the 1998 contract, sees it differently. He has said he believes Mayo wants out of its contract — a claim that Mayo vehemently denies.
Gartner, one of 12 people running for three city council seats this fall, has since met privately with Dr. Witt to discuss his concerns — among them, that the city loses influence and authority under a regional governance model. He's not alone in his concern, noting that four people stopped him during a recent trip to the grocery store to ask about the issue.
"Mayo believes it's in the best interest of Mayo to have this regional board," Gartner said. "There are some members of the community, including some members of the city council, who believe it would be best to continue the current agreement in place for the rest of the (term of the) agreement, which is about another 12 years.
"That (local governance board) was one of the things we wanted very clearly to obtain (in 1998), ensuring some participation from the community was required," Gartner said. "That was a very, very important point that was negotiated at great length with the folks out of Rochester. The language is very clear and unique."
According to Mayo Clinic, any change to the local governance model requires a two-step public process in Lake City — first a super-majority vote by the local governance board, then another vote by the city council.
"In other words, Mayo Clinic Health System in Lake City will not implement a governance change unless all of the necessary approvals are obtained," said Dr. Witt.
Those votes are months away, with lots of hurdles to clear first.
"I don't think there is anything surprising in those conversations at this time," Gostout said. "People are appropriately raising challenges. Mayo is appropriately responding. As we work through those (concerns), I hope it will become obvious … that we're not at odds with Lake City. We share a common goal. Our future's are intertwined … so I think our interests are very much aligned."
Witt said: "Mayo Clinic Health System does not plan to end its affiliation agreement with Lake City. We continue to be committed to our patients and the Lake City community. We see the medical center in Lake City growing and expanding services in the future."
As part of the 30-year contract, Mayo agreed to purchase Lake City's existing hospital for $7 million. Mayo still owes the city about $3 million, which is scheduled to be paid over the remaining 12 years of the deal.
Unrelated to the looming changes in the governance model, Lake City residents have already been spooked by staffing changes at its Mayo facility.
Two doctors and a nurse practitioner have resigned effective early next month. A third doctor has announced his retirement, effective at the end of July.
Those changes have occurred while Mayo shifts its service model to a team-based approach, which is already in place throughout Mayo Clinic Health System. In addition, Mayo recently announced that 11 health care providers from other Mayo facilities across Southeast Minnesota will help fill the Lake City vacancies until new employees are hired; the 11 consist of 10 physicians and one physician assistant.
"We are working actively to recruit more physicians, nurse practitioners, and physician assistants to our permanent staff as soon as possible," Dr. Witt said via press release. "In the short term, we also have a team of providers identified to serve our emergency department and hospital patients."
But the moves raise questions in the community.
"People I talk to, they're really upset about losing their doctors," Boe said. "It's the old, 'What's going on up there?' — especially from the older generation and people who rely on the hospital."