SIOUX FALLS, S.D. (KELO) — Kelby Krabbenhoft oversaw significant growth at Sanford Health for the past 23 years and that growth was almost always linked to donations from T. Denny Sanford.
Sanford has invested an estimated $1 billion into Sanford Health, enough to get the system named for him. Krabbenhoft has been at the helm for all of it.
Krabbenhoft, the chief executive officer and president, and Sanford Health mutually agreed to part ways, Sanford announced on Nov. 24. Krabbenhoft told KELOLAND News it was the right time to retire, although in October he said would not retire for at least a year.
The departure was immediate and comes about a month after Sanford and Intermountain Healthcare of Salt Lake City, Utah announced an agreement to merge that would be completed in 2021. Krabbenhoft was to remain with Sanford for 18 months, he said.
He became Sanford’s chief executive officer and president in 1997, according to the Sanford Health website. The was the same year that Sioux Valley Hospital and Health systems was formed.
By 2003, the Sioux Valley system had grown to 25 hospitals, 92 clinics and more than 300 physicians.
T. Denny Sanford investment
A $400 million gift from T. Denny Sanford that started unprecedented growth and a name change that led to Krabbenhoft being the leader of the state’s largest health care system and one of the top 40 largest hospitals in the nation.
The system has 46 hospitals, more than 200 senior living facilities and more than 200 clinics and about 47,700 employees in 26 states and 10 countries.
With Sanford’s $400 million gift, Krabbenhoft announced four major initiatives: Sanford Pediatrics Clinic, Sanford Research, the Sanford Project, a type 1 diabetes effort, and Sanford Health Care Campus.
The Sanford Children’s Hospital, a 146-bed hospital designed like a castle opened in 2009.
Denny Sanford another $100 million in 2011 to establish the Edith Sanford Breast Center which opened in 2016.
The Sanford Imagenetics Center opened in 2014. This is the first program in the nation to embed the latest in genomic medicine with primary care, according to the website. The center was funded in large part by a $125 million gift from Denny Sanford.
According to the Sanford Health website, the Sanford Cancer Center, Van Demark Building, Ronald McDonald House, Make-A-Wish and Ava’s House (adult and pediatric hospice), as well as Sanford Clinic facilities were expanded or added from 2012 through 2017.
Expansion beyond Sioux Falls
While investment from Denny Sanford helped to grow expansion and additions at the medical school and Sioux Falls campus, Sanford Health grew by mergers with healthcare systems in other states.
One of the most significant mergers to date was the 2009 partnership with MeritCare of North Dakota.
HealthLeaders media said on Nov. 2, 2009, the merger meant that Sanford Health-MeritCare will operate in six states: North Dakota, South Dakota, Minnesota, Iowa, Nebraska, and Oklahoma, with 17,400 employees and more than 800 physicians, 70 specialty areas in medicine, and 29 hospitals over 1,600 beds serving more than 2 million people in the service area. The combined annual net revenue is $2 billion.
Krabbenhoft said at the time of the merger that it marked the point when the health system became “nationally relevant,” a Nov. 1, 2019, story published by Sanford Health said.
“The things we do, the people we talk to and the questions we ask will have national relevance, national impact. We didn’t seek that; that is the nature of what we’ve created,” he added, the Nov. 1 story said.
While the merged system used MeritCare in the beginning, by June of 2010, it was announced that MeritCare would be dropped from the system.
The Fargo partner has continue to grow with the addition of new hospital in 2017 as well as other improvements.
Sanford stepped fully into Minnesota when it merged with North Country Health Services in Bemidji, Minnesota, in 2011.
The system established the Sanford World Clinic in 2018. This system had 30 clinics in several countries in 2019.
A merger between Sanford Health and the Good Samaritan Society, which operated dozens of long term care facilities, completed a merger in January of 2019. Good Samaritan has facilities in at least 20 states.
More recently, Sanford announced on Oct. 26 it agreed to a merger with Intermountain Health of Salt Lake City, Utah.
The planned merger is expected to be completed in 2021.
Two mergers that didn’t work
Sanford did have at least two potential partners that didn’t work out.
Sanford and Fairview of Minnesota discussed a possible merger in early 2013 which also included the University of Minnesota. Sanford withdrew from discussions after then Minnesota Attorney General Lori Swanson and some other state public officials had expressed some concerns about a possible merger.
Last year, a proposed proposed merger with UnityPoint Health of Des Moines, Iowa, failed when Unity backed out. A Nov. 12, 2019, KELOLAND News story said Unity was concerned about a lawsuit and related issues on a device used by a former Sanford doctor.
Seeking the Minnesota Vikings training camp and others
While Krabbenhoft was the leader during Denny Sanford’s investments and Sanford Health growth, Krabbenhoft also has a life-long passion for athletic activity, and basketball in particular, according to his biography in the South Dakota Hall of Fame.
In 2004 and 2006, Krabbenhoft led unsuccessful efforts to secure Sioux Falls as the site for the Minnesota Vikings training camp. A Feb. 6, 2006 story in the Mankato Free Press, said Fargo and Duluth were among the other interested cities. The Vikings stayed in Mankato until moving training camp to their Eagan, Minnesota, facility in 2018.
The S.D. Hall of Fame said Krabbenhoft “led the charge to develop the Orthopedics and Sports Medicine service line into a national practice, established the POWER program to help athletes of all levels improve their performance, and established the Sanford Sports Complex in Sioux Falls.”
The Associated Press reported on June 24, 2018, that Krabbenhoft was a key player in Augustana University’s pursuit of NCAA Division 1 status.
Krabbenhoft believes the decision is more about academics than athletics. He called sports “just the front porch” to expanding research departments and professional schools that would attract students, including some who could become doctors and nurses for his organization, the AP story.
“The dynamic question is: What does Augie want to become? Not in terms of history or reputation, but size,” Krabbenhoft said in the 2018 AP story. “Do they want to become kind of a Notre Dame-ish organization, or a Creighton? As a private school in this arena, those are kind of the icons or the trailblazers they should try to emulate. And then it’s possible.”
About that email to staff
Krabbenhoft’s announced departure from Sanford Health came about a week after he shared an email letter with staff in which he discussed his COVID-19 case and the wearing of masks.
Krabbenhoft said in the email letter that he had COVID-19 and was recovered and said he didn’t need to wear a mask as a symbolic gesture.
“For me to wear a mask defies the efficacy and purpose of a mask and sends an untruthful message that I am susceptible to infection or could transmit it. I have no interest in using masks as a symbolic gesture,” he wrote in the email letter.
Yet, Krabbenhoft also wrote that, “On the other hand, for people who have not contracted the virus and may acquire it and then spread it…. It is important for them to know that masks are just plain smart to use and in their best interest.”
In a Nov. 20 interview with KELOLAND’s Angela Kennecke after his email resulted in multiple news stories, Krabbenhoft spoke to the severity of the pandemic
“The word crisis to me is one we should be very cautious using. It’s been thrown around very flippantly. It’s just hard for me to get to the word crisis with what we’re dealing with right now,” Krabbenhoft said in the Nov. 20 interview.
Two days after the email, Sanford Health released a statement on social media about the importance of wearing masks.