A Record of Putting Profits Before Patients

All Minnesotans deserve access to quality, affordable healthcare, and frontline workers in healthcare settings deserve safe and healthy work environments. But executives of HealthPartners of Minnesota are pushing decisions and priorities which reflect a corporate healthcare model that prioritizes profits over patients, raising questions about how committed they really are to putting patients before profits.

HealthPartners' "Priorities" vs. HealthPartners' Record

HealthPartners claims to prioritize “Health as it could be, affordability as it must be.”[1] Their current President and CEO Andrea Walsh asserts that “our focus is making health care simpler and more affordable.”[2]

These are admirable goals with which most Minnesotans and healthcare workers would agree. But the record and actions of HealthPartners executives puts these priorities into question.

HealthPartners executives spend millions on expansion while healthcare costs for Minnesotans rise
As healthcare costs for average Minnesotans were rising rapidly, HealthPartners executives spent $62 million to construct Regions Hospital in St. Paul. These corporate-minded expansion practices were criticized at the time by a senior official at Blue Cross and Blue Shield of Minnesota, who noted that “Some of the facilities, especially in the Twin Cities, look duplicative. And if they are primarily designed with revenue and competition in mind, the result will be to add to healthcare costs unnecessarily, while other needs continue to grow.” (Modern Healthcare, 9/23/2002)[3]
HealthPartners leadership attempted to hide excessive compensation to top executives
HealthPartners’ former CEO George Halvorson was paid $1.1 million in 2001, “. . . of which $250,000 was classified as deferred compensation” (Modern Healthcare, 11/25/2002).[4] Halvorson’s publicly disclosed compensation was lower than his final compensation in a time when consumers were calling for increased transparency in insurance costs due to increasing rates. HealthPartners’ board appeared to perform this concealment deliberately: “HealthPartners board members approved a lucrative retirement plan for former chief executive George Halvorson only after making sure the plan would not have to be reported to the public, according to documents reviewed by the Minnesota attorney general’s office. It was one of several compensation enhancements and secret arrangements that gave Halvorson $5.5 million in pay and benefits when he left the company last April, according to the investigative report, released this week. The board also took action, at Halvorson’s request, to hide his bonuses from other employees, according to company documents.”[5]
Questionable executive spending at HealthPartners
Then Minnesota Attorney General Mike Hatch’s office conducted an investigation of Minnesota healthcare organizations. Regarding HealthPartners specifically, “Hatch’s audit revealed that the company had paid for international travel, out-of-state retreats and trips for the board of directors and for executive compensation that was not disclosed to the public.”[6]
Workers struggle to afford HealthPartner's premiums
Metro Transit workers faced a potential strike over contract negotiations with their employer, the Metropolitan Council. “The largest dispute between the council and the union has to do with health-care insurance. The union has said a HealthPartners family plan that costs about $266 a month today would cost $676 a month by Jan. 1, 2006, under the Met Council offer.”[7] This would more than double the annual premium for vital public workers. Many of these workers raised serious questions about a possible conflict of interest influencing the healthcare negotiations: then President and CEO of HealthPartners Mary Brainerd is married to the Director of Human Resources at Met Council who was a central figure in contract negotiations.[8]
Shouldn't "simpler and more affordable healthcare" include hospital workers too?
1,500 clinical workers including nurses, nurse practitioners, dental assistants, pharmacists, and technicians represented by SEIU opposed proposals from HealthPartners executives to increase employees’ healthcare costs including increased “. . . copays for office visits and brand-name prescription drugs.”[9] (Star Tribune, 2/6/2005)
HealthPartners executives cut mental health staff despite growing demand for services
HealthPartners executives laid off a quarter of the staff therapists at its largest mental health clinic, citing financial concerns. “’This decision painfully demonstrates that decisions about health care delivery are now being made by accountants and are no longer in the hands of health care professionals,’ said Daniel Keefe, one of the licensed social workers at the clinic who will lose his job. Keefe said the cutbacks could have serious consequences for seriously mentally ill patients, who now must find new therapists in a mental health system where the demand for services outnumbers the supply of providers who are accepting new patients.”[10] HealthPartners’ cuts to this line of service came despite their website’s current claim that they are “committed to mental health.”[11]
Reducing employee benefits vs improving care
1,500 HealthPartners nurses and clinic workers represented by SEIU were nearly pushed into a strike over “patient safety issues.” While workers wanted “. . . to work out disputes with doctors and administrations over workplace safety,” HealthPartners executives proposed that workers take on more of the cost of their health insurance plans. HealthPartners tried to shift increased healthcare costs to employees just three years prior. (St. Paul Pioneer Press, 2/9/2008)[12]
HealthPartners' Virtuwell online services takes patient care away from the hospital
HealthPartners executives launched its telemedicine platform Virtuwell in late 2010. While the convenience of telemedicine may seem attractive, its increasing use in healthcare shifts healthcare away from actual hospitals. This concern arises “. . . particularly as retail clinics move into prevention efforts for people with chronic diseases such as diabetes, asthma and heart failure. A ‘virtual’ consultation can’t replace face-to-face care, opponents say.” (Star Tribune, 11/25/2012 and https://www.virtuwell.com/inside-virtuwell)[13]
HealthPartners' implicated in discrimination lawsuit
A Minnesota Nurse Practitioner sued her employer (Essentia) and HealthPartners as her insurance plan administrator over discriminatory practices for not covering healthcare costs protected under federal law. HealthPartners tried to avoid responsibility for the discriminatory practices, claiming HealthPartners “. . . should not be held liable because it was only enforcing the coverage decisions made by Essentia.” The federal judge disagreed with this and kept HealthPartners as a defendant. (Star Tribune, 9/22/2018)[14]
HealthPartners executives demand $4 million from St. Paul schools over teachers’ decision to adopt more affordable insurance provider
Paul teachers voted to shift their health insurance from HealthPartners to the Public Employees Insurance program due to increasing costs. The teachers’ decision came largely due to “[t]he HealthPartners contract [calling] for consecutive 7 percent premium hikes; PEIP does not guarantee its rate structure, but premiums historically have climbed by about 2.5 percent each year.” (St. Paul Pioneer Press, 7/24/2019)[15] Nick Faber, then President of the Saint Paul Federation of Educators explained that “[s]witching [plans from HealthPartners] would provide more affordable health care for members – particularly for some lower paid paraprofessionals – and a wider choice of plans for members in the future. SPFE also argues that HealthPartners is a nonprofit with $7 billion in revenue and that the company does not pay taxes to help support education and can afford to waive the penalty.” (Star Tribune, 8/9/2019)[16]
Healthcare workers set to strike over increased healthcare costs
Increased healthcare costs pushed 95% of clinic workers at HealthPartners, represented by SEIU Healthcare Minnesota, to vote in favor of a strike during contract negotiations: “Announcing vote results Friday morning, leaders of SEIU Healthcare Minnesota said that HealthPartners wants its clinic workers to accept steep cuts in health benefits even though the health system is posting strong revenue.”[17]
Executives furloughed staff during a pandemic
In the early months of the pandemic, HealthPartners executives, like those at other hospitals, laid off and furloughed healthcare workers despite the anticipated strain the virus would put on Minnesota’s healthcare system. In early May, just two months after the first confirmed case of COVID-19 in Minnesota,[18] “[h]ealth care providers [were] trimming staff while simultaneously ramping up operations in anticipation of coronavirus cases.”[19](Star Tribune, 5/6/2020) The furloughs affected 2,600 workers at HealthPartners.[20] (Star Tribune, 4/24/2020)
Executives laid off healthcare workers and closed clinics despite ongoing pandemic
In the early months of the pandemic, HealthPartners executives, like those at other hospitals, HealthPartners executives announced they were eliminating about 200 jobs at Sartell and Minneapolis clinics, following the elimination of more than 400 jobs in late 2019. HealthPartners “described the closures as part of a shift toward more online home health care with COVID-19, and a strategy to rethink where the health system needs brick-and-mortar clinics.”[21] HealthPartners executives’ push towards more virtual visits has changed the way Minnesotans can access healthcare (the Sartell facility, facing more than 130 layoffs, is “. . . a large provider of primary care, pediatrics and obstetrics services in the St. Cloud area”[22] ) and resulted in a loss of direct care jobs. (Star Tribune, 7/3/2020)
HealthPartners makes millions in profits during pandemic

HealthPartners posted stronger earnings in 2020 than many healthcare organizations. The federal CARES Act “. . . provided $129.8 million in funding last year [2020] to HealthPartners. The health system also cut expenses by lowering salaries and closing clinics. . . In 2020, HealthPartners saw revenue of $7.03 billion and expenses of about $6.94 billion, resulting in operating income of $96 million. . . “[23] HealthPartners saw a profitable year while workers faced layoffs and communities saw their clinics closed.

HealthPartners executives hike individual health insurance rates
HealthPartners executives sought to increase insurance coverage rates for individual plan holders by 11.3%, the second highest rate increase in the state that year.[24] This steep increase request occurred during the COVID-19 pandemic while many Minnesotans (including healthcare workers at HealthPartners) faced furloughs, layoffs, reductions in hours, and closures at their workplaces amidst rising cost of living. (Star Tribune, 8/1/2021).


[1] https://www.healthpartners.com/about/


[3]They’ve got the blues: Minnesota Blues and hospitals point fingers regarding who is ultimately responsible for the nation’s soaring healthcare costs, Modern Healthcare, September 23, 2002

[4] OK, so not all of those rising costs come from hospital, Modern Healthcare, November 25, 2002

[5] HealthPartners took pains to downplay bonuses to former CEO, The Associated Press State & Local Wire, January 17, 2003

[6] Improved HMO oversight needed, governor says, The Associated Press State & Local Wire, January 31, 2003

[7] Met Council wants specifics of arbitration, Star Tribune, January 6, 2004

[8]Is conflict of interest a factor in bus strike?; A husband-wife connection raises the transit union’s suspicions, Star Tribune, March 28, 2004

[9]Union recommends HealthPartners pact, Star Tribune, February 6, 2005

[10] HealthPartners trims mental health staff: The organization said it isn’t getting out of the mental health business. Its medical clinics still have therapists on staff, Star Tribune, January 11, 2006

[11]HealthPartners website, https://www.healthpartners.com/about/community/mental-health/

[12]Twin Cities / HealthPartners, clinic workers union reach deal St. Paul Pioneer Press, February 9, 2008

[13]https://www.virtuwell.com/inside-virtuwell and The new house call is online, Star Tribune, November 25, 2012

[14] Trans insurance suit can proceed, Star Tribune, September 22, 2018

[15]St. Paul district on hook for $4M after teacher union votes to leave health plan, St. Paul Pioneer Press, July 24, 2019

[16]St. Paul teachers should honor pact, Star Tribune, August 9, 2019

[17]HP clinic workers vote for a strike, Star Tribune, February 8, 2020

[18]Health officials confirm first case of novel coronavirus in Minnesota, Minnesota Department of Health News Release, March 6, 2020 (https://www.health.state.mn.us/news/pressrel/2020/covid19030620.html)

[19]Virus forcing Allina to slash worker costs, Star Tribune, May 6, 2020

[20]HealthPartners to furlough 2,600, Star Tribune, April 24, 2020

[21]System cutting 200 jobs at clinics, Star Tribune, July 3, 2020

[22] ibid

[23]Insurer comes out ahead in pandemic, Star Tribune, May 7, 2021

[24] State health insurers seek steeper rate hikes for individual coverage, Star Tribune, August 1, 202