CentraCare healthcare system to acquire Stellis Health in merger of central Minnesota providers
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Stellis Health, a healthcare organization based in Wright County, plans to merge with CentraCare, the central Minnesota region’s largest healthcare provider.
Stellis is an independent, doctor-owned medical group that has provided care for patients in Buffalo, Monticello and surrounding communities for 75 years. It has more than 60 primary and specialty physicians, physician associates and nurse practitioners at clinics in Buffalo and Monticello.
On Wednesday, Stellis announced that it plans to become part of CentraCare. The CentraCare healthcare system operates nine hospitals and more than 30 clinics in Minnesota, including its flagship hospital in St. Cloud.
Under the proposed agreement, Stellis physicians, advanced practice providers and staff would join CentraCare on Jan. 1.
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Stellis' shareholders have already voted to move forward with the plan. The organizations said they are working to finalize agreements and to gain regulators’ approval of the merger. In Minnesota, the attorney general’s office and the state Department of Health review healthcare mergers.
The two organizations already have a history of collaboration, including at CentraCare-Monticello hospital, where Stellis physicians provide care.
In a news release, CentraCare CEO Ken Holmen said healthcare is “changing rapidly, and we need to be thoughtful about how we position our organization for the future.”
“Bringing our organizations together builds on an already successful relationship and creates opportunities to better connect primary care, specialty care and hospital services, making it easier for patients to access the care they need,” Holmen said.
The financial terms of the agreement were not disclosed.
For now, Stellis clinics will continue operating as usual, and patients can continue seeing their current providers.
The move comes as Minnesota’s healthcare systems face increasing financial pressures from rising costs and cuts to federal reimbursement programs such as Medicaid and Medicare.
CentraCare cited those factors last year, when it laid off 535 employees at 44 locations. The healthcare system said it was responding to significant external pressures, including reimbursement rates that no longer cover the cost of care.
Several proposed mergers are reshaping Minnesota’s healthcare industry. Bloomington-based HealthPartners and Duluth-based Essentia Health announced plans to combine in September.
South Dakota-based Sanford Health and North Memorial Health completed a merger last month. Allina Health and California-based Sutter Health have signed an agreement, which remains under review by state regulators.
