Sanford Health Gives Notice to End Wellmark Contract July 1, 2027, in South Dakota
Northeast Radio SD News – Watertown, SD - Sanford Health has issued a contract termination notice to insurance provider Wellmark, effective July 1, 2027, after months of negotiations over terms affecting patients in South Dakota.
According to Sanford Health, the decision follows extensive discussions in which Wellmark refused to compromise on demands for exclusive control over decisions affecting patient care. Sanford officials said Wellmark is seeking a long-term agreement that gives the insurer sole authority to change key contract terms after the agreement is signed, including policies governing how patients receive care and how that care is reimbursed.
"Our patients come first. Decisions affecting access to care and the future of local healthcare services must be mutually negotiated, not dictated by Wellmark," said Nick Olson, executive vice president and chief financial officer at Sanford Health.
"We cannot accept a contract that gives an insurance company the power to change the terms on its own, with consequences for the care our patients and communities depend on."
No Immediate Changes to Patient Coverage
Sanford Health remains in network with Wellmark for now. Patient coverage and benefits will not change immediately, and all scheduled appointments, procedures, and treatments will continue as planned.
The July 1, 2027 termination date gives Sanford Health and Wellmark an eight-month window to negotiate a new agreement. The contract dispute primarily affects Wellmark members, though it may also impact BlueCard patients seeking care at Sanford Health facilities in South Dakota and Iowa.
Dispute Over Reimbursement and Rural Healthcare Stability
Sanford Health said it supports multi-year agreements when contracts set clear expectations, provide stability, and offer market-appropriate reimbursement rates that keep pace with the cost of care. According to the health system, ongoing uncertainty over reimbursement and unilateral contract changes make it harder to plan community services, sustain specialty care, collaborate with independent physician groups, and invest in local facilities and workforce needs across rural communities.
"Patients in rural communities should not have to travel farther or wait longer to receive care because of decisions made by an insurance company," said Joshua Crabtree, M.D., chief physician at Sanford Health.
"Also, patients should not have to choose between affordable health insurance and access to trusted local healthcare providers. Both matter. Health insurance is most valuable when patients can use it to access the doctors they trust and the hospitals and services they need, when and where they need them. Healthcare contracts should support affordability while also protecting access to care close to home."
Sanford officials noted that their goal is to reach an agreement that preserves access to local and regional healthcare services, including South Dakota's only Level I Adult Trauma Center and Level II Pediatric Trauma Center at Sanford USD Medical Center in Sioux Falls.
Resources for South Dakota Patients
South Dakota patients seeking additional information regarding the contract negotiations can visit sanfordhealth.org/lp/insurance-updates.
Patients with questions or concerns about their current health coverage and available options should contact their insurance provider directly using the phone number listed on the back of their member card.
