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Published June 06, 2013, 09:01 AM

Sanford Health to trim $10 million in top jobs

FARGO, N.D. (AP) — Dakotas-based Sanford Health is streamlining management in a plan that is expected save the growing system an estimated $10 million per year.

FARGO, N.D. (AP) — Dakotas-based Sanford Health is streamlining management in a plan that is expected save the growing system an estimated $10 million per year.

Fifty administrators have accepted early retirement or a new position or will be bought out in the restructuring, Sanford CEO Kelby Krabbenhoft told The Forum newspaper.

Sanford also is planning to centralize management of system-wide functions such as pharmacy and laboratory services. That will mean a new office building next to the $500 million medical center being built in Fargo, North Dakota's largest city.

Top corporate offices will remain in Sioux Falls, South Dakota's largest city.

The changes are not being prompted by any budget problems but are a proactive move to deal with expected reductions in reimbursements by both public and private insurers, according to Krabbenhoft.

"That's the way I avoid layoffs — by staying on top of it," he said.

The Sanford Health system was formed by the merger of Sioux Falls-based Sanford with Fargo-based Meritcare in 2009. It has grown through mergers and also through new services, and now runs nearly three dozen hospitals and more than 140 clinics in eight states. It bills itself as the nation's largest not-for-profit rural health care provider.

The system has about 26,000 employees, including 3,000 new positions created through the new programs and increased patient volumes since 2009. It is adding 80 positions to handle a Medicare billing system that will be based in Fargo. Training for those positions is to begin next month.

The new office building next to the new medical center in Fargo is expected to be ready for occupancy within four years, Krabbenhoft said. The size and cost of the building have not yet been determined.

"We continue to grow," Krabbenhoft said. "I hope we're sending the message now that we're growing very cautiously and very carefully."

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