Fairview Health Services

What it reported doing in 2022

St. Joseph's Hospital was founded by the Sisters of St. Joseph of Carondelet in 1853. It had the distinction of being Minnesota's first hospital. For years, St. Joseph's operated as the smallest of four acute care hospitals located within a few blocks from each other in downtown St. Paul. More than half of all St. Joseph's patients came from outside the city of Saint Paul and 72 percent of the hospital's total emergency department visits were considered potentially preventable with proper primary care - which was one of the highest rates in the state. Acute services and traditional emergency room care can be expensive and may only address short-term healthcare needs without providing a long-term solution for patients. Based on more than 300 community conversations over two years, it became clear that the current care model at St. Joseph's was not meeting the health needs of the surrounding communities. Nor was that model financially sustainable for our healthcare system. As part of our commitment and vision to provide affordable, accessible, and equitable care - the hospital has been reimagined as a Community Health and Wellness Hub with several new and expanding partnerships and programs. These plans represent Fairview's intentional, holistic approach to health and well-being and commitment to serving all in its community, especially those who have been traditionally underserved. Services in the Wellness Hub will include no-to-low-cost primary care, other supportive services and education (provided by Minnesota Community Care, a federally qualified health center), expanded outpatient mental health and addition services, an enhanced adult day program, a food distribution partnership with Second Harvest Heartland and long-term acute care services. A newly established Fairview Center for Community Health Equity will serve as an incubator for the next generation of community-based health and wellness programs focused on prevention and addressing the Social Determinants of Health. The Hub will also have a new community education space featuring conference and meeting facilities for community convenings, outreach programs, and wellness services, such as mobile vaccination and food access programs. St. Joseph's provided inpatient mental health services through June 2022. The emergency department at St. Joseph's discontinued services in December 2020. St. Joseph's is part of Fairview Health Services. Fairview Health Services is an industry-leading, award-winning, nonprofit, integrated health system providing exceptional health care across the full spectrum of health care services. Founded in 1906, Fairview serves the twelve-county Minneapolis/St. Paul Metro Area, as well as communities throughout greater Minnesota and portions of Northern Iowa and Western Wisconsin and is one of the most comprehensive and geographically accessible systems in Minnesota. Fairview, the University of Minnesota and the University of Minnesota Physicians approved an agreement which became effective in late 2018 (the "M Health Fairview Agreement"). While the parties maintain their separate governance, the M Health Fairview Agreement further integrated operations across the clinical delivery system and enhances research and education by creating a joint clinical enterprise among the parties. The M Health Fairview Agreement brings together not only UMMC and its related service lines, but also Fairview's other hospitals, primary care clinics, and other services. All are part of a shared care delivery system that is led by a single structure that includes academic physician leadership. The goal of the joint clinical enterprise is to create a nationally-renowned academic health system. This care system was united under a single brand, M Health Fairview, which is inclusive of the Fairview Hospitals and Clinics Fairview owns and operates the following hospitals: UMMC, M Health Fairview Southdale Hospital, M Health Fairview Ridges Hospital, M Health Fairview Lakes

Financial Efficiency

• Mission deployment rate: 100%; rating input score 100
• Program expense ratio: 79.7%; rating input score 80
• Fundraising efficiency: Limited

Transparency & Controls

• Consistency checks: 100%; rating input score 100; 63rd percentile among comparable filings
• Pay-setting controls: 0 of 6 controls in place; rating input score 0
  • Compensation committee: Missing
  • Independent consultant: Missing
  • Other Form 990s reviewed: Missing
  • Written employment contract: Missing
  • Compensation survey or study: Missing
  • Board or committee approval: Missing
• Foreign activity oversight: Limited
• Grant itemization coverage: Limited
• Major donor itemization: Yes; rating input score 100
• Related-party transparency: Limited

Accountability

• Independent voting board: 95%; rating input score 95; 29th percentile among comparable filings
• Governance controls: 9 of 9 controls in place; rating input score 100
  • Conflict-of-interest policy: Pass
  • Whistleblower policy: Pass
  • Document-retention policy: Pass
  • CEO compensation review process: Pass
  • Other executive compensation review process: Pass
  • Form 990 shared with the board: Pass
  • Board meeting minutes documented: Pass
  • Audit committee oversight: Pass
  • Independent financial-statement audit: Pass

Sustainability

• Operating margin: -61.4%; rating input score 1; 1st percentile among comparable filings
• Total-asset coverage ratio: 0; rating input score 0; 0th percentile among comparable filings
• Liabilities to assets ratio: Limited
• Officer compensation ratio: 2.7%; rating input score 68; 68th percentile among comparable filings

Growth

• Program expense growth: -3.5% per year; rating input score 0; 6th percentile among comparable filings
• Revenue growth: -2.2% per year; rating input score 0; 5th percentile among comparable filings
• Asset growth: -8.6% per year; rating input score 0; 2nd percentile among comparable filings