North Memorial Health CEO: Robbinsdale Hospital at Financial ‘Breaking Point’
North Memorial Health is sounding the alarm on financial challenges facing the nonprofit health system saying unreimbursed care at its Robbinsdale hospital has put it at “a breaking point.”
CEO Trevor Sawallish, who took over the lead role last month, is making a plea for county and state assistance to help cover losses. Sawallish said the impact from unreimbursed and underreimbursed care at North Memorial Health Hospital is projected to reach $100 million by 2025.
“Like so many in health care today, we have pretty profound financial challenges,” said Sawallish at Tuesday’s Maple Grove City Council meeting. “North finds itself at a pretty critical juncture.”
Sawallish gave the Maple Grove City Council an update on its financial situation because the 353-bed hospital in Robbinsdale also impacts Maple Grove Hospital, which North Memorial Health also owns. Without any outside assistance, Sawallish said North Memorial Health would have to delay plans for expansion at Maple Grove Hospital.
“We’re continuing our plans. We have many different versions of what that could look like,” said Sawallish. “But until we solve this problem for our overall economics, and in particular until we solve this problem for Robbinsdale, those plans are going to be on hold.”
The Maple Grove Hospital expansion plans have been discussed for the past couple of years. The hospital was initially designed for 25,000 visits a year when it opened in 2009. Now patient volume has doubled.
Maple Grove Mayor Mark Steffenson agreed a solution is needed saying the city’s growth needs the expansion to happen.
“Everything west of the river and north of downtown [Minneapolis] is served by these two hospitals. And I think the legislature needs to acknowledge that and help remedy the problem,” said Steffenson.
Financial Challenges at Robbinsdale Hospital
Sawallish said about three out of every four patients admitted to North Memorial Health Hospital in Robbinsdale receive some sort of government assistance, higher than the state average. The Robbinsdale hospital is also a Level I trauma center, one of only four in the state.
Emergency department admissions to North Memorial Health Hospital from the top 15 poorest ZIP codes in Hennepin County in 2022 reached more than 3,800 patients. That’s compared to more than 3,900 patients, a nearly identical figure, for Hennepin Healthcare, which operates the HCMC Level I trauma center in downtown Minneapolis.
Yet Sawallish said Hennepin County discontinued funds this year for the Robbinsdale hospital after receiving county funds last year.
North Memorial Health lost $46 million in 2023 due to unreimbursed care, said Sawallish. The hospital system said it put in $70 million for safety net care and received $24 million from the county.
Sawallish is pushing for the passage of legislation, House file 3943 and Senate file 3838, which would allow North Memorial Health to be placed into Medicaid’s direct payment funding program. The program requires local funding to leverage federal dollars, which is why North Memorial is seeking county help.
“Government payment does not respond as quickly as those costs are going up,” said Sawallish. “It really truly is a breaking point for us.”
