Independent hospital resists pressure to align with Mayo

  • Article by: JACKIE CROSBY , Star Tribune
  • Updated: June 27, 2013 - 12:03 AM

River’s Edge in St. Peter resists pressure to align with the local giant.


Mayo is « the elephant in the room that no one will address. well, i am addressing it. » Colleen Spike, CEO of River’s Edge hospital

Photo: Richard Sennott ,

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– As Colleen Spike walks the polished floors of the city-owned hospital here, she proudly shows off the private rooms with state-of-the-art whirlpool baths, healing sunlight and the latest in modular designs to accommodate families.

After 16 years as head of River’s Edge Hospital and Clinic, Spike has become a hero to some for fiercely defending its independence as giant medical centers have bought up similar facilities across the country.

In southeastern Minnesota, the giant is the rapidly expanding Mayo Clinic. And the fight has grown contentious, with Spike complaining to the state attorney general about Mayo’s “dangerous monopoly” and “predatory threats” in steering patients toward its own facilities.

“It’s been going on for years,” said Spike, who is retiring as CEO of River’s Edge at the end of December. “They are the elephant in the room that no one will address. Well, I am addressing it.”

Spike, 62, a soft-spoken redhead with Irish roots, frames it as a David and Goliath story, with her 17-bed independent hospital defending itself against one of the nation’s largest and most-lauded hospital systems, one “that is used to getting its way.”

Mayo doctors and hospital officials see it differently. They deny any concerted effort to direct patient care to Mayo’s facilities in Mankato or elsewhere for financial gain, pointing out that more than 75 percent of River’s Edge patients come from referrals from a nearby Mayo facility.

“It’s distressing to us to be accused of sabotaging River’s Edge,” said the Mayo Clinic’s Dr. Elizabeth Osborne, who has been a family doctor in St. Peter for 21 years and is a former member of the hospital commission. “The hospital has been struggling, and it’s only natural to look for someone to put the blame on and say who’s at fault.”

The conflict is happening as independent hospitals in rural as well as urban areas feel pressure to align with bigger systems. That worries some patient advocates, businesses, doctors and insurers who fear that more consolidation in less-populated regions will lead to fewer services at a higher cost.

The number of independent hospitals in Minnesota has been shrinking for 25 years, according to state figures. In 1987, about 61 percent of the state’s 128 hospitals were independent. By the end of last year, just 37 percent remained unaffiliated with a larger hospital system.

“It’s not just the Mayo Clinic and St. Peter,” said Angie Franks, president of Minneapolis-based Healthland, which works with rural hospitals to install computerized medical records systems and other management software. “It’s happening all over.”

Mayo Clinic owns the primary care clinic in St. Peter that is attached to the River’s Edge Hospital through a hallway and light-filled atrium. Mayo also owns a 272-bed hospital 12 miles down Hwy. 169 in Mankato. The Mankato hospital is vastly better-equipped to take on complex medical cases, but also offers many of the same services as River’s Edge, including basic lab and diagnostic work.

Spike asserts that patients seen at the Mayo primary care clinic “were being lied to” and told that River’s Edge was full, or didn’t offer certain services, such as mammograms, knee surgery and cardiac care. River’s Edge lost $727,000 last year, its fourth straight in the red. Spike pointed to Mayo as a key factor.

She highlighted a drop in admissions for swing beds, a Medicare program for patients who need extra care after hospital stays, and accused the Mayo hospital in Mankato of diverting patients who wanted to go to River’s Edge for recovery to its own facilities in Waseca and St. James.

In an October letter to Attorney General Lori Swanson, Spike and former Mayo family physicians Randeep Dhami of Springfield and Lael Luedtke of Fairmont didn’t parse words. They described Mayo as an “invasive species” that is driving away good doctors and increasing the cost of medical care.

Spike said she met twice with state officials but doesn’t know the status of her complaint. The attorney general’s office doesn’t comment on investigations.

Mayo’s strategy

Mayo is undeniably on a growth march, expanding its network of rural hospitals and primary care clinics and pushing out from its flagship complex in Rochester. Recent Minnesota acquisitions include Queen of Peace Hospital in New Prague and a clinic in Red Wing.

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