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MeritCare and Sanford Health set to complete their merger today

FARGO -- The merger of the two largest health systems in the Dakotas will lead to more bus trips, officials say.

Fargo's MeritCare and Sioux Falls, S.D.-based Sanford Health are expected to complete their merger today. The new system, with nearly 14,000 full-time employees and $1.9 billion in assets, will operate its own fleet of two buses to shuttle staff and physicians between medical campuses in Fargo and Sioux Falls.

Work on road

The buses will be equipped so staff members can work on the road. When needed, managers and other staff, not patients, will do the traveling, said Kelby Krabbenhoft, Sanford's chief executive, who will lead the merged system.

"These markets are so separate and unique," Krabbenhoft said. "It's not a shuttle health service. You can't do it. What you can do is shuttle leadership."

The merger will cap eight months of talks between the two large health systems, each dominant in its service area.

The united system is to be called Sanford Health & MeritCare, with the separate names continuing in their traditional service areas.

"Our priority has been uninterrupted service," Krabbenhoft said.

Sanford Health & MeritCare will have a coverage area of 130,000 square miles, encompassing parts of five states -- North Dakota, South Dakota, Minnesota, Iowa and Nebraska -- in an area that is heavily rural.

Krabbenhoft said floor plans have been drawn up for new executive offices in downtown Fargo. He has said he envisions a roughly $300 million health complex in five or six years in southwest Fargo.

No layoffs are planned, Krabbenhoft said.

"That topic has not even made it -- and I can swear to it -- into any of our conversations," he said.

"The new structure will prompt movement of people around the organization," he said. "That's the sign of a healthy company."

The two health systems are of similar size and have much in common, including roots as Lutheran hospitals founded a century ago. MeritCare has placed a greater emphasis on clinics and large group practices of physicians, while Sanford has focused more on a network of hospitals.

Sanford provides its own health insurance coverage, an option it plans to extend to North Dakota and northwestern Minnesota, pending regulatory approval.

Sanford's network includes 23 hospitals as well as 19 nursing homes, 18 assisted and congregate living centers and 43 clinics. MeritCare has more than 20 hospitals and clinics in eastern North Dakota and western Minnesota.

Construction of a new $78 million heart center, including 58 beds, is the latest in a string of Sanford projects that have expanded services and upgraded facilities during the 14-year tenure of Krabbenhoft, a native of Sabin, Minn. Sanford's research initiative is a goal to find a cure for childhood diabetes.

The merger did not require an antitrust review because the service areas of MeritCare and Sanford do not overlap.