Sanford Health to add Black Hills Surgical Hospital, Black Hills Orthopedic and Spine Center

Sanford Health to add Black Hills Surgical Hospital, Black Hills Orthopedic and Spine Center

Nov. 14, 2024

Sanford Health is making a big move into western South Dakota, becoming the parent company of Black Hills Surgical Hospital and Black Hills Orthopedic and Spine Center.

The medical centers currently are physician-owned and will transition to nonprofit status as they start operating as part of Sanford Health.

The deal is expected to close next week and includes associated facilities in Rapid City as well as Black Hills Surgery Center in Gillette, Wyoming, including urgent care locations, clinics and an ambulatory surgery center.

“I could not be happier,” Sanford Health CEO Bill Gassen said in an interview with SiouxFalls.Business.

“It starts with our organizational aspiration, which is to be the premier rural health system in the United States, and to do that, we have to continue to grow organically and to grow through partnerships and do it in a way that makes sense for the geography with have today with like-minded partners who have a shared vision.”

Through the broader Sanford organization, Black Hills patients will be more easily connected to a full range of integrated health care, clinical trials, veterans precision medicine and other services, Sanford said in announcing the move.

The Black Hills region, including Rapid City, “has always been and always will be on the strategic road map for us,” Gassen said. “Rapid City has always been an opportunity for us to continue to invest more and continue to grow in the services we deliver.”

This partnership builds upon Sanford’s history of providing care in the region, including specialty outreach, AirMed transport and other services for Rapid City and western South Dakota. Sanford also operates a specialty reference laboratory in Rapid City and has provided specialty outreach for families in the area for more than two decades.

Outreach services include specialty pediatrics, reproductive endocrinology, fertility and genetic counseling, and maternal fetal medicine. Sanford also provides long-term care to residents in the area through the Good Samaritan Society at St. Martin’s Campus, Home Health of the Black Hills, Echo Ridge Campus and New Underwood.

“Through those services, we’ve been in the community of Rapid City for a very long time, but we have had a desire to continue to grow and expand those services,” Gassen said. “To do that and to do it really well, what’s worked for Sanford Health historically is to find good, strong community partners to come together with and be able to grow together with them, and that’s what we’ve been able to find.”

Black Hills Orthopedic and Spine Center was founded in 1976 and includes more than 18 board-certified and fellowship-trained specialists.

Black Hills Surgical Hospital has achieved nationally recognized care in a range of areas, including orthopedics, neurosurgery, rehabilitation, cardiology, pain management, sports medicine, occupational medicine, imaging and urgent care.

“We sought out a partner who shares our unwavering commitment to exceptional, high-quality care and a vision for bringing innovation and the most advanced medicine to those we serve,” said Dr. Lew Papendick, chair of Black Hills Surgical Hospital LLP. “We’re inspired by Sanford Health’s commitment to being the premier rural health system in the United States and excited to help move that forward in western South Dakota and Wyoming on behalf of our patients.”

Upon completion of the deal next week, a regional board of community leaders will be established to govern the operations and strategy of the Western SD/Wyoming region, with Papendick, a longtime physician and community leader, serving as chair. Kyle Wiese will serve as regional president and CEO, and local physician leaders will represent the Western SD/Wyoming market within the Sanford Health organization.

“South Dakota is a small state, and health care is an even smaller world,” Gassen said, adding that he received care growing up from the Black Hills medical group and that he has known Wiese, who now leads the organizations, for years.

“They’re the premier orthopedic and neurosurgery group in the broader region, known well for top-level quality … and in addition to that, the physician leaders really shared they had a broader vision to expand more services in the greater Black Hills area, to do the things they’ve been doing for years through orthopedics and sports medicine and neurosurgery practices … and that they want to continue to expand and extend more services to increase access in the community.”

Coming together with Sanford supports those goals for both entities, he said, and allows Sanford to build on the physicians’ relationships with other independent providers in the region.

“They also have a really strong entrepreneurial mindset, which makes them not only great physicians but great leaders and helps us  … make sure we’re growing the services they need (and understanding) what are the gaps that exist in the community, what are the opportunities to make smart investments that strengthen health care but continue to strengthen the community as a whole,” Gassen said, adding that Sanford’s mindset is “allowing physicians to lead the practice and make sure we’re getting them the tools so that they can do that work but allowing them to be at the forefront of that.”

Conversations with the physician leaders began in the past year, he said.

What future growth in the Black Hills region looks like for Sanford is yet to be solidified, but it is part of the strategic vision, he added.

“We have a strong commitment. This isn’t just it,” Gassen said. “We intend to grow and expand services in the community to be responsive to and meet those needs. How that happens, we’ll rely on the physicians and physician leadership in Rapid City. They’ve done a great job building out a care model to date.”

The deal is Sanford’s second major merger effort of the year. Its combination with Wisconsin-based Marshfield Clinic Health System still is expected to close by the end of the year.

“We feel like we’re in a great spot there,” Gassen said. “And I could not be more excited about the opportunity to join the organizations together and really just continue to further the mission of delivering world-class care in rural America.”


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