Jeff Keeling, Associate Editor
By Jeff Keeling
Blood may be thicker than water, but it apparently wasn’t thick enough to hold together an early rapprochement between Wellmont Health System and Mountain States Health Alliance.
Eastman Credit Union’s recent quarter million dollar gift to help Marsh Regional Blood Center buy a new bloodmobile reminded me of Wellmont-owned Marsh’s four-year run as the blood supplier of choice for Johnson City Medical Center and several other MSHA hospitals.
The marriage broke up in September 2013, but I remember the wedding as if it happened yesterday. The fanfare paled in comparison to the systems’ April 2, 2015 merger announcement, but at the time it was a big deal nonetheless.
With the midsummer heat of 2009 at bay in an air-conditioned room, then-MSHA CEO Dennis Vonderfecht and his Wellmont counterpart, Mike Snow, rolled up their sleeves and grinned, cool as cucumbers, as the donation needles signified this local collaboration by sinking into their veins.
The Red Cross could raise as big a stink as it wanted to (and it did): MSHA was ready to bury the hypodermic when it came to purchasing blood, and buy local even if the supplier was in most respects a bitter rival.
A regular donor, I dutifully made the switch to Marsh, the region’s only local supplier. Now I have to admit, their followup wasn’t everything it could have been. When you’ve grown accustomed to the incessant reminders from Red Cross, it helps to get at least a semblance of that from the new guy.
I stuck with the program, though. It seemed to me that done effectively, a local collaborative could only benefit both systems and the communities.
Then, out of the blue as it were, came a MSHA announcement just a few months before Vonderfecht retired that MSHA was parting ways with Marsh. MSHA’s then-CEO of Washington County facilities, David Nicely, said Chattanooga-based Blood Assurance – now MSHA’s provider here – was offering better prices to MSHA hospitals in Virginia. He said Marsh had been given an opportunity to match the offered deal and, “they were unable to do that.”
I’m generally a free market proponent. MSHA had every right to secure a better deal. This decision, though, struck me as more layered than your standard swapping of one national vendor for another.
Clearly, Marsh (and by extension its owner, Wellmont) had to invest significant additional resources in order to meet its new level of demand post-2009. When the agreement was reached, Marsh director Don Campbell said supply would need to increase 30 to 40 percent.
All that investment represented local dollars and local jobs. A symbolic local agreement had been brokered that represented the beginning of something many people had longed desired – at least a semblance of collaboration where collaboration made sense. From where I sit, it would take many extra pieces of silver to justify an about-face.
The fallout clearly stung for Wellmont. The system’s fourth-quarter financial report revealed that for that fiscal year (July 2013 through June 2014), Wellmont had suffered “blood bank revenue reductions of $3.4 million due to the loss of a significant contract.” Through the third quarter of fiscal 2015 (March 2015), those revenue reductions were still significant at $1.4 million.
It’s possible Wellmont insisted on sticking it to MSHA just a little too hard in this collaboration. If so, I’m sure many people regret that now. Since September 2013, though, the worm has turned again. If I were a betting man, I’d put money on one of two outcomes should MSHA and Wellmont merge: Marsh becoming the sole supplier for the merged system, or Marsh ceasing to exist because it lacks the scale to cost-effectively provide its product.
We’ll all see how those things play out. In the meantime, during this week in which we celebrate love, I urge any of you who don’t donate blood to consider doing so – to whatever provider you choose.
