Business journal april 2015

The Wellmont – Mountain States merger in-depth Exclusive C-Suite Roundtable: Levine, Hove, Pope and Eichorn on plans for the new company Noland on the third leg Why the COPA is key Alan Levine, Mountain States Health Alliance CEO and Bart Hove, Wellmont Health System CEO April 2 at Meadowview. Photo by Adam Campbell.

Plus: Dentsply agreement reached

APRIL 2015

$3.00 Volume 27 Number 8

and

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Business Journal The

| COVER STORY

of Tri-Cities Tennessee/Virgina

The Wellmont-Mountain States merger: in-depth coverage

OFFICE 423.854.0140 PUBLISHER William R. Derby bderby@bjournal.com 423.979.1300

Alan Levine and Bart Hove Photo by Adam Campbell

8

The announcement The news conference that felt more like a party.

20 The third leg

ETSU will play a key role in growing the new company through research.

9

C-Suite Roundtable: Four people have been named to the executive team that will run the merged company.

All four sat down with The Business Journal for an hour immediately after the news conference to talk about their plans for the future.

22 At the COPA

Leaders confident COPA can address competition concerns.

Greene looks back and 24 Bill looks ahead

| FEATURES

26

Washington County, Tenn.’s efforts to save 189 jobs and create 25 more pay off.

ASSOCIATE EDITOR Jeff Keeling jkeeling@bjournal.com 423.773.6438 SALES & MARKETING Jeff Williams jwilliams@bjournal.com 423.202.2240 Robin Williams rwilliams@bjournal.com 423.794.6938

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The Business Journal of Tri-Cities Tennessee/Virginia

50 years of John Tickle The Bristol native turned a struggling company into an industry leader, and has been a model leader for decades.

is published monthly by Derby Publishing, LLC 1114 Sunset Drive, Suite 2 Johnson City, TN 37604 Phone: 423.854.0140 ©2015 Periodicals postage paid at Johnson City, Tenn. and additional offices.

ISSN#10406360

| DEPARTMENTS 7 From the Editor 32 On The Move

MANAGING EDITOR Scott Robertson srobertson@bjournal.com 423.767.4904

CREATIVE Derby Publishing, LLC Graphics Director / Judd Shaw jshaw@bjournal.com 423.833.2726

In July, Wellmont had no plans to merge with Mountain States. Greene led the business community’s effort to change that.

Dentsply to stay, grow in Johnson City

ASSISTANT PUBLISHER Jeff Derby jderby@bjournal.com 423.306.0104

33 Awards & Achievements 38 The Last Word

POSTMASTER:

Please send addresses to

Business Journal of Tri-Cities, TN/VA 1114 Sunset Drive, Suite 2 Johnson City, TN 37604 Subscription per year $35.

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The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

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| FROM THE EDITOR

Are there finally enough grown-ups in the room?

I

’ve been covering the business community in the Tri-Cities for more than 20 years now. I was there when the chairs and CEOs of Bristol Regional and Holston Valley sat on a stage and told us about the formation of Wellmont Health System. I was there when Johnson City Medical Center acquired the Columbia/HCA hospitals that together formed the nucleus of Mountain States Health Alliance. And I was there April 2, 2015, when the chairs and CEOs of both systems announced they plan to merge by year’s end.

One of those things was, in a very significant way, unlike the others. The joint Wellmont-MSHA news conference of April 2, 2015 was not about any particular “us” versus any particular “them.” Don’t get me wrong. I love competition. It’s at the heart of good business. It drives excellence. But there are ways competition can drive mediocrity as well.

Nobody has been more competitive in this market than Mountain States and Wellmont.

Yet the intense competition between the systems led to a cold war-like spending spree on both sides that grew both systems’ debt while creating a surplus of duplicated services in some areas and a dearth of them in others.

Short-term factors based on micro-geographic competition drove both systems to make decisions that were bad for each system on a larger scale and in the long-term. What was good for Norton, or Kingsport, for instance in 2005, may have turned out to be bad for the entire system, and for the entire region, in 2015.

The idea now is that one system, with an over-arching strategy for improving the healthcare marketplace in the region, will do a better job. The state governments of Tennessee and Virginia, through regulations outlined in respective Certificates of Public Advantage (COPAs) will be charged with ensuring the negative potential effects of a monopoly do not appear.

At the April 2 news conference, I asked the assembled delegation of board chairs, CEOs and doctors at the head table the following question: “In terms of both culture and economic development, in the past Wellmont vs Mountain States has been the poster child for the Sullivan County vs Washington County mindset in this business community. Do you see this merger as a harbinger for a greater

regional approach in economic development and do you plan to actively pursue such?”

Barbara Allen, Mountain States Board chair took the microphone and replied, “Unscripted?

Isn’t it nice that we’ve all grown up?”

Yes, Ms. Allen, if that’s true, it will be nice.

For years, Northeast Tennessee counties have been at each other’s throats in economic development, while the rest of the state’s regions have been forming partnerships that have gone after jobs far more effectively.

Like Wellmont and Mountain States, we have competed, but mostly with ourselves, and mostly in ways that may have generated shortterm benefits for one community or another, but have cost the entire region in the long run.

Mountain States and Wellmont do not need to be competing with each other to bring down costs, so long as the COPA is well-enough written to protect payers, employers and others with whom the hospitals do business. They need, together, to be solving the over-arching problems that lead to higher healthcare costs.

Just so, Sullivan and Washington counties (and their cities) do not need to be competing against each other for what other regions see as loose change. We need to be working together to address the issues that make businesses take their jobs and capital investment to other areas of the state instead of coming to the Tri-Cities.

We’ve seen the beginning of such co-opetition this year. Sullivan County and Hawkins County are starting to work together.

Washington, Carter and Unicoi Counties are exploring how to work for mutual economic development benefit. And most excitingly, NETWORKS Sullivan County and the Washington County Economic Development Council have made their first joint proposals.

The support for a regional approach to problem solving in Northeast Tennessee and Southwest Virginia has not been greater since the founding of Tri-Cities Regional Airport.

This kind of opportunity may not come again in our lifetimes. But if there is to be further progress, the same grown-ups who are backing the Wellmont-Mountain States merger will need to step forward again.

BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

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| FEATURE STORY

Systems, ETSU announce plans to create ‘health improvement organization’

By Jeff Keeling

L

eaders of the region’s second-largest hospital system surprised few people April 2 when they announced they would seek to merge with their larger counterpart after years of often-fierce competition.

But an early comment in a packed news conference at Kingsport’s Meadowview Convention Center indicated how unlikely a marriage with Mountain States Health Alliance seemed when Wellmont Health System began its “strategic options process” more than a year ago.

Leading off a panel of seven speakers, Wellmont’s board chairman Roger Leonard said the proposed “health improvement organization” being unveiled was, “an exciting opportunity not imagined by any of us at the beginning of this process.”

The merger, which envisions a major role for East Tennessee State University, was agreed in principle with the signing of a term sheet between the two systems’ leaders. They said they hope for regulatory approval by the state of Tennessee and Commonwealth of Virginia by the end of 2015 for an arrangement that, while it would essentially eliminate competition in the regional market, would benefit patients and payers.

During its search, Wellmont had discussions with a number of suitors from outside the region. It was one of those suitors, Leonard said, who helped move the needle toward a local option.

“One of the CEOs pulled me aside and said, ‘as much as we would like to merge with you, you have 20 percent overutilization in your market … you’re really going to have to address that inside the market.

We can’t come in from the outside and address that.’

“Through these savings that are going to be generated,” Leonard added, “we’ll be able to reinvest resources into new programs, into new services that we’re not addressing right now.”

Mountain States chair Barbara Allen said the new system – the name of which has not been announced – will be, 8

The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

“among the best health systems in the nation.” In addition, Allen said, rather than proving a detriment to consumers and patients, the elimination of competition will help unleash better quality and allow for more favorable cost structures.

“We will be known as a high-value system, Bart Hove discusses future plans as Alan Levine listens during the April 2 committed to not news conference announcing the merger plans. Photo by Adam Campbell. only decreasing the growth in cost of health care, but

Levine said the goal is to create in becoming a system that consistently something, “that is designed to meet the performs as one of America’s most highly triple aim that’s been adopted nationally, reliable, high quality health care systems,” of improving the health of the population, she added. secondly, improving individual outcomes

Proposed to lead that system at the for our patients, and third, reducing the highest management level are Mountain overall cost of care for the employers and States CEO Alan Levine as executive chair- the community.” man and president; Wellmont interim

In the end, the proposal will go to CEO Bart Hove as CEO; Mountain States the states, with the systems seeking two Chief Operating Officer Marvin Eichorn “Certificates of Public Advantage” (COPA) as COO; and Wellmont Chief Financial based on the states’ determination that Officer Alice Pope as CFO. ETSU President the benefits of the plan outweigh disadDr. Brian Noland would serve as an ex vantages presented by lack of competiofficio member of the new board, which tion. The COPAs would be regulated would include six representatives selected for compliance, and would also prevent by each of the two current boards, and two federal anti-trust action unless either additional at-large community members. state were to decide the arrangement

An “integration council” that includes wasn’t delivering on its goals. significant physician representation will

One of the three main bond ratings work toward a “definitive agreement” of agencies, Standard & Poor’s, released a merger. ETSU will lead a health assessshort statement on the merger proposal ment this summer and fall that will help the night of the announcement. It redefine the system’s goals and structure. frained from much in the way of opinion, Levine said “getting ahead of” the region’s and took no rating actions (both systems manifold health problems at the commuare rated BBB plus) but did offer this: “We nity level will be a major strategy as health believe it is likely the two systems will care reform continues to shift payment successfully reach a final agreement to models in a way that discourages overreli- merge and that any regulatory issues will ance on hospitalization. be addressed.”

| COVER STORY

The C-suite roundtable: (L-R) Scott Robertson, Marvin Eichorn, Alice Pope, Alan Levine, Bart Hove and Jeff Keeling. Photos ny Adam Campbell.

Wellmont/Mountain States C-Suite Roundtable

By Scott Robertson and Jeff Keeling

Immediately following the April 2 news conference in which leaders from Wellmont Health System and Mountain States Health Alliance announced plans to merge their respective hospital systems, the four C-suite executives who have been designated to run the new company stepped across the hall to discuss specifics of the plan with the editorial staff of The Business Journal of Tri-Cities, TN/VA. What follows are selected excerpts from the transcript of the question and answer session between MSHA CEO Alan Levine, who is slated to become executive chairman and president of the new company; Bart Hove, CEO of Wellmont, who is to be the CEO of the new company; Marvin Eichorn, COO of Mountain States, who is slated to keep that role in the new company; and Alice Pope, CFO of Wellmont, who is also slated to maintain her current role in the new company. The full transcript is available at bjournal.com.

BJ: During the last few months, we kept hearing if Mountain States could convince Eastman that if a Mountain StatesWellmont partnership would be good for Eastman, then Eastman’s support would mean a great deal to the Wellmont board.

Did Mountain States reach out specifically to Eastman in this process, and if so, what was discussed to help Eastman see the benefit of the partnership?

Alan Levine: We talked to a lot of business leaders about health care issues generally. What I said publicly is the same

thing I’ve said to people privately: our concern – and I’m speaking for Mountain States here – our concern has always been that the status quo isn’t really sustainable over time. If your business model is, ‘enter a business where the use rates are declining and the revenues are being cut,’ most people wouldn’t want to enter that business model. So if you’re in it, you have to be innovative and find ways to survive, and not just survive but thrive.

As you talk to outside organizations and you look at what has occurred as other health systems have merged with larger

systems that are based elsewhere, the data’s pretty compelling. It wasn’t what we thought was best, and I suspect most of the business leaders in the region have seen some of the same things in doing their own research. Typically, it hasn’t led necessarily to better quality, and pricing has gone up when these systems regionally have joined larger systems based elsewhere. So given what our employer community looks like – a lot of them are self-insured – we felt that frankly that was not the right model SEE ROUNDTABLE, 10 BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

9

| COVER STORY

Levine addresses rapid change in healthcare as Hove looks on.

input from many of the businesses across our community as well as individual citizens to help formulate their overall goals and objectives when it came time to analyze the proposals that had been presented to them.

That input was very valuable to the board in ultimately making their selection, and they did listen to all of that information collectively coming in to our organization.

BJ: The boards have already made some specific decisions about for them because it would all end up coming top managerial leadership. What are a few out of their ability to grow jobs. So as we’ve of the most important deliverables those talked to employers they’ve seen the same leaders guided by the board – and here you thing we have. They’re not just taking our are – will have to execute at the highest word for it, I think they’ve looked at the data level of competence in order for this plan to themselves and they’ve seen what we’ve succeed? What’s on you? seen.

I don’t think it was any one company Hove: Initially the guiding charges that that we talked to. Every company leader we have come from the term sheet that we’ve talked to in this region has been was agreed to by the boards, and that is the deeply committed to making sure that the formulation of an integration task force. right thing is done, whatever that is, and I That task force is charged with certain actually was very inspired by that throughaspects like drawing up policies as to how out this process. They’ve all taken a very the board would ultimately analyze differactive interest, not only as business leaders ent business situations across the market. whose employees use our services, but as That would be overseen by the joint board donors and as philanthropists who support task force. The integration council was the both of our systems. first group, the joint board task force is the

The thing about Eastman, and others overseer of the integration council. And just like Food City that are large employers, NN, the boards populating their board positions everybody else – one of the things that we and the integration council starting to work hear from them is, they’re trying to recruit together as a team looking at the opportunipeople to this region. They have implored ties in building the platforms going forward upon us how important it is to invest in that we would use to execute the definitive these pediatric sub-specialties and to do agreement. something about the overall health of the population, because it’s become an issue for Levine: Right now our task is to get everybody in terms of recruitment. Drug the definitive agreement done, so there addiction is a problem, and they’ve all talked are specific things that have to be done about that. What we proposed was really a between now and then. We’re going to do summary of all the things that we had heard a culture audit to identify opportunities to from the business leaders who basically are bring our cultures together. Those things our stakeholders. have to be done prior to the definitive agreement, so the integration council’s Bart Hove: The Wellmont board sought primary task right now is to address those ROUNDTABLE, CONTINUED

10 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

things to a definitive agreement.

After that, as Bart was referring to, coming up with policies for how we make some of these bigger clinical decisions later. Another aspect of this is the creation of the clinical council, and we want to make sure that we have physician input on major clinical decisions. It’s something that I think is already in the DNA of both organizations. We are very physician-driven, so we’ve created a formal mechanism for physicians to have input into this process.

There’s the near term of getting to the definitive, then once the definitive is done, submitting the definitive to the attorneys general and departments of health and beginning the negotiation of the certificate of public advantage.

What’s on us? Once a definitive is done, obviously putting the team together, filling it out, and then beginning the work, the very, very important work of assimilating a new board and establishing a culture on the new board, and establishing a culture in the new organization that brings the two organizations together as one. That’s the most important thing we’ll do, because that culture is what will drive this organization for the next generation. It’s a big load, but when you look at the collective backgrounds of the four of us, they’re very complementary. We all bring different strengths, and we’re all known quantities, the boards have now worked with all of us, and I think you’ve got a situation where you’ve got four people and then some who have a great chemistry and work well together. And each brings a very unique set of skills to this.

BJ: Alan, 18 months or so ago when you were introduced at Mountain States, you told us that during the interview process you hadn’t even discussed mergers. At the same time, Dennis Vonderfecht told us he expected Mountain States to be involved in some sort of merger process, if he were going to put a crystal ball on it, in five to 10 years. You also talked about how rapidly you expect change to occur in health care in the coming years. Were you surprised by how quickly this opportunity came about?

Levine: I was. But when Wellmont made the decision to go through the process, I think that opened up an opportunity for some dialogue. Dennis may have said Mountain States may have been looking at

a merger in five to 10 years, and it’s true that we never discussed a merger when I interviewed. All the things you said are accurate. The part that’s most accurate is how fast the changes are happening in health care. I didn’t foresee the federal sequestration being continued, and the continued cuts to Medicare, no expansion. Those things all add up to become pretty monumental challenges.

So from our perspective, when Wellmont started the process, it created an opportunity for us to say, “If we were going to create something new, what would it look like?” So we said, “We can’t just propose merging our systems and creating another hospital system. If we’re going to do this, we want to create something that’s more of a health improvement organization.”

When you look at the variables here, the high inpatient use rates that are declining, but still among the highest in the nation, what are the variables really driving that? Some of the things driving that are, if you have the types of health care disparities that we see in Southwest

Virginia and Northeast Tennessee, if you don’t ever affect those, if you don’t ever do anything to change those, you never really change the underlying causal factor for this high cost.

So it opened up the opportunity, and it was a very long process, but I think once Wellmont went through the process, I was pleased that they found that what we had proposed was worthy of more discussion, and once we both started having dialogue, boy, it really turned into something great. So no, I wouldn’t have foreseen it happening this quickly, but I’m glad it did.

Hove: At the end of the day, once the dialogue takes place, good leaders regardless of whether it’s health care or business and industry, create opportunities. Good leaders also know when to seize opportunities. I don’t believe that Wellmont necessarily expected an opportunity like this to come up and be presented to it during the strategic options process.

SEE ROUNDTABLE, 12

Hove talks about qualities of leadership.

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BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

11

| COVER STORY

Levine says the merger can be a national model.

ROUNDTABLE, CONTINUED

But good leadership has prevailed to take advantage of that opportunity and turn it into something phenomenal, and that’s the objective that was laid out today.

Levine: And I would just add one thing.

If we did wait for five years, I don’t think Mountain States would be approaching it from as strong a position as we are today, and I think the same is true of Wellmont.

Both of us are very strong organizations, neither of which wanted to wait until it became a crisis. It’s better to actually plan your future and have a strategy for it than to have it imposed on you.

BJ: Another one from the interview a year and a half ago. You said, “even if it’s a welloiled machine, there is always the opportunity to do better.” When doing preliminary due diligence on the possibility of this partnership, where did you and your teams see opportunities in your own system that could be created through synergies with the other system?

Hove: When we started our process in the strategic assessment, and organizations came to us and presented their information, in order to further vet the final companies that we were talking with, there was what’s called a data sharing piece, where there’s opportunities to share this information back and forth that meets Federal Trade Commission regulations. The challenge for us 12 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

was when it comes to a cross-town organization and you’re in a synergistic market, you don’t have as much access and availability to that information. Another reason the process took so long at the tail end of our strategic options research, the information that was presented was in more of a vision of what our organization could look like going forward, and so the vision that we entailed in looking at how health care can be modified and changed for the benefit of our community working under a COPA regulation, honestly we didn’t know much about a COPA regulation when we started the process either. So as we became more knowledgeable and more educated throughout that vetting process, the opportunities started to escalate as it relates to improving health care in the region. So we haven’t done all of the due diligence – that’s what we’ve got to start into now, with how our organizations mathematically come together to look at those particular opportunities, but that’s more of the work to be done. The vision is what was presented by Mountain States’ leadership that actually sold the Wellmont organization.

decile. But is it good enough to be really good at treating people when they’re sick, and our answer is clearly no. As the region’s health delivery system, our job should be to get in front of when people get sick and try to influence those factors that create the need for hospitalization. When we go meet with our bond rating agencies, we’re measured on how many patients do we have in the beds, and what is our revenue, and it gets old being measured on that when you know that what you really ought to be measured on is, are you really improving the overall health of your community.

I think as a new system, we’re going to be able to define how we’re going to be measured. I think that’s much more exciting, and frankly when you think about it, that’s the kind of thing that really good people want to be a part of. Good doctors, great doctors, they want to be a part of something like that where they see that there is a vision.

Think about academics, the partnership with ETSU. We had cut residency slots in the last few years because of the financial challenges. We’re out there competing with the Atlantas and other major markets for doctors as our doctors retire. Where’s a doctor that’s coming fresh out of training going to go? Are they going to go somewhere that has a richness in training and academics and opportunities for research? Or are they going to come to a rural community where it’s struggling? We’re saying, the model we want is the model that we’ve painted, and I really believe – and I believe that the state and the Commonwealth both see it too.

Levine: As I look at outside systems, they’re prominent and excellent systems.

And you compare Wellmont and Mountain States, our performance versus theirs, what I think we find, we don’t see in the area of quality that there was anything to be added incrementally, because the quality is driven by our doctors and our team members.

When you compare Wellmont and Mountain States, we actually look a lot alike.

Both systems have hospitals that have won awards and recognitions and all that stuff.

One of the things we sat back and talked about was, OK, this is great, we have really good hospitals that do a good job treating people when they’re sick. And our goal is to be the top decile in the nation. On anything that’s measured, we want to be in the top

BJ: This sounds like something that was very much out of the Kaufman-Hall (Wellmont’s strategic options consultant) matrix box, of what you guys were expecting when this process started. I don’t know what a health improvement organization is – it sounds very different than probably what you all launched into.

Hove: It’s a difference between a hospital system and a true health system. It’s not just nomenclature. When you’re talking about a health system, you’re talking about more than just taking care of sick people in hospitals. That’s where we aren’t today, and where we want to be in the future. There are a few that do exist, but there are only a few, and where health care’s going is in that

Eichorn discusses the new company’s prospective bond rating.

direction, and it’s going rapidly. That’s what Alan was talking about earlier is trying to move our organization together collectively on board fast enough to get ahead of this curve so we can be a true health system and affect the overall health of our communities.

Levine: There’s several different types of things out there you can look at. One of the things I’ve been looking at is the notion of an accountable care community. You have these ACOs, accountable care organizations. This idea of an accountable care community, San Diego is doing it with a 10-year strategy of improving the overall health of the community. It involves more than just the health system. It’s employers, it’s schools, it’s everything. You look at Mission in Asheville. They didn’t go quite as far as what we’re talking about, but if you look at the actual results they’ve achieved under a COPA, it’s irrefutable. Irrespective of what people think of a COPA, the data is irrefutable. Their admission rates are among the lower ones in the country on virtually every one of the diagnoses, their overall cost per case is much lower. In fact if you do the math it’s like a $50 million a year savings to the payers because of the things that have been done. There are multiple models. I think what’s going to happen over the next year is, we’re going to spend a lot of time building what we’re going to be and a lot of that’s going to be driven by the assessment that we do with ETSU, because that’s got to be the beginning of the road map for us.

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BJ: Right now both systems are BBB plus. How do you see Fitch and Moody’s and S & P reacting to this partnership and why?

Marvin Eichhorn: I think they’re going to be very positive about it. Whether or not they say anything in the short run while we’re in this stage remains to be seen. I think we’re both kind of waiting to see if one in particular says something perhaps Monday. They’re not going to lift our bond ratings, but they may offer some perspective on how they see this as they look forward for the longer term. One of the things we think could possibly come out of this, we’ve actually run some numbers we actually shared with the Wellmont board during our presentation saying if we did bring the system together we would move to an A rating. Without efficiencies, the population health initiatives we would do. Obviously we’ve got to get the SEE ROUNDTABLE, 14

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| COVER STORY

Eichorn, Pope, Levine and Hove listen to a question from Jeff Keeling.

BJ: There are other players besides the ratings agencies that can have a major impact merger done, but I personally feel very BJ: Capital plans aren’t nearly what they on the potential for success here. The most confident we can get the combined system were 10 years ago, but does that incremen- obvious would be the payers – Anthem, to an A rating. tal bond rating improvement free up some BlueCross BlueShield Tennessee, Cigna, kind of cash flow?

Humana, United. Aside from just having Alice Pope: I agree. And we have looked the COPA, how do you get those players at the information that is publicly availPope: An improvement in our rating means behind this? I would think they would be able at other health systems and where we a lower cost of capital, so to the extent that among the most likely to be made nervous could compare, and I would agree that we together we look at refinancing or looking at by something like this. are confident that we can move into that A a new debt structure for the new company, category. And we’re confident that the rating clearly there could be some savings for a Levine: We have been talking with the payagencies will view this positively. (Editor’s health system that moves into a higher rated ers to give them a notification before we annote: Standard & Poor’s released a short category. nounced this just so they weren’t surprised. statement the night of the merger announceThe conversations – your characterization is ment, indicating it, “has no immediate effect Eichorn: Our variable rate debt, if we get accurate – their first reaction is a little neron ratings.” The rating agency did note that in the bond rating to go up, it immediately vous. But then beyond that, when you start its view, “the merged organization will likely comes down, because that stuff trades talking about what your vision is, and our have opportunities for cost reduction and every single week. Fixed rate debt, the ability to use the scale of our organization to other operating synergies, but at this point people who own the bonds see an improve- partner with the payers – the conversation detailed benefits of the merger cannot be fully ment in the value of their bonds, which we have with the payers all the time is to evaluated.” Finally, S&P offered, “We believe they’re going to love. But until we refinance argue over rates and all that stuff. That’s the that it is likely the two systems will successwe really wouldn’t see it ourselves, just the name of the game in the current environfully reach a final agreement to merge and that bondholders. ment, but you don’t get to the discussion about what the cost drivers are. What are the things that are driving the costs for your subscribers, and how can we partner with you to actually improve, whether it’s quality or on the cost side? This gives us the ability

Mountain States Wellmont to actually invest in the infrastructure that’s required to partner with our payers in a Hospitals 13 6 much more thoughtful way. That’s been very Employees 8,610 6,577 intriguing to them. We’ll let them speak for themselves, and whether or not they want Revenues (FY 2014) $1,054,846,000 $772,707,000 to talk about this is up to them, but I will Total net assets $732,941,000 $550,830,000 tell you that our observation is that they are intrigued by that and they want to have Long-term debt $1,074,069,000 $490,443,000 more discussion about that. Obviously, ROUNDTABLE, CONTINUED

any regulatory issues will be addressed.”)

Tale of the Tape

14 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

Ken Misterly

General Manager

Summer Renner

Lori Keene

Sales Manager

Conference Coordinator

Levine talks about reinvesting in the new company.

there will be people of interest the attorneys general will want to talk to and that will be between them and the attorney general.

Hove: The conversations that we have had have changed in tone and input when we start talking about advancing the cause of population health. Seems like the payers right now have to push individual hospitals or small systems to get to a value proposition in some of their programs, whereas offering up the opportunity to partner and demonstrate population health to help control the costs of the subscriber or the employer or the consumer, they get excited about that opportunity.

BJ: You’re looking at investments in research. You’re also eliminating some of the unnecessary duplication of services that we’ve heard about for the last 15 years and are creating efficiencies just by having greater scale in dealing with vendors. And eventually, you hope, research will be creating its own gains. Aside from investing in the research, where do you take the money that’s realized through these efficiencies and invest back into the system?

Pope: Needed services. Services that are needed in this economy, but are going elsewhere. It really is as simple as that. There are services that are needed here that are now going to Knoxville, Nashville and other places. It would be our intent to reinvest in our communities, and provide those needed services locally.

BJ: You’re talking about things like sub-specialties?

Pope: Yes. We mentioned it in the news conference. There are cases like a grandmother who is raising the baby born to her drug-addicted daughter. The baby was born addicted to drugs and the grandmother has to travel far and wide to get that baby the treatment it needs. We want to bring those services back to this area.

Levine: If you look at the investments we have already begun making in access for children and are just implementing in the Center for Child and Family Health at Niswonger Children’s Hospital, we want to diffuse those throughout the region. We want to have points of access for children. We have more than 200,000 kids in our region, SEE ROUNDTABLE, 16 BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

15

| COVER STORY your way in toward the hub of hospitals, what you really want to do is provide many of whom need some form of seraccess closest to where people live. The vice, whether it’s kids with developmental people that benefit the most from that are disabilities who can’t access services, the the people who are most vulnerable. They ability to partner with the state to bring are lower income people who can’t travel services through that center to these and who don’t have insurance. So there is communities – these are things that have a compelling state interest to what we’re never really been talked about, or if they trying to do here. have been, the resources just haven’t been there to do it. So I think it’s critically BJ: Let’s talk about how you make the important that we look at the combined public comfortable that you’ll keep your value that all the investments that both word on anti-monopolistic steps mansystems have made. We have made cerdated in the COPA. Virtually the entire tain investments at Niswonger. Wellmont process to date has been done behind has made incredible investments in areas closed doors for obvious reasons. How like cardiology and cancer, as have we. do you communicate to those constituenYou bring those together and figure out cies that you are giving them every bit of how to bring those services, with the information they need, that it is all either support of resources to the communities available to them now or they will have that need them instead of an almost it before closing? irrational duplication of it where you’re not bringing it always to where it needs Hove: Well, one aspect is that we’ll be to be, closest to where people are. It’s a looking to our attorneys to see what we change of mindset and it’ll take time, but can and can’t say. We do have a new I think the ultimate goal, when you start website where we will be providing a lot Pope says the company will reinvest in needed services. from the rural communities and work of information for people to follow the TriCities1/2page_Tri=Cities Business Journal 3/27/15 8:42 AM Page 1 ROUNDTABLE, CONTINUED

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supervisors and bosses they work for. It’s more at the governance and management level. There is a competitiveness there, and I get it and that’s fine. But when I got here a little over a year ago, it didn’t feel healthy to me. I feel like these organizations, because of the unique challenges of this region, have so much in common. So I think it’s not going to be as difficult as people think it will be. Frankly, you have different leadership in both of our individual organizations who want to make this happen. So I’m encouraged.

BJ: What is a culture audit?

Eichorn harkens back to the formation of MSHA for parallels with the current process.

process. We have pledged monthly meetings with our employees to keep them informed of the progress we’re making. We are still governed by the fact that we are two separate organizations, though. We are limited as to what areas and aspects we can get into. The COPA is the governor of the whole thing. We have to, in that, prove that we are going to improve access to care, that we are going to hold costs down, that we are going to have community and individual support for the process that we’re asking the state to allow us to implement. We have a lot of work ahead of us to be able to get there. But it is inherent in that work that we continually update that website and dialogue with our employees to keep them up to date of our progress.

BJ: One would hope a smaller concern will be convincing your people who have been competing tooth-and-nail for almost 20 years that the war is over and it’s time to play nice.

You mentioned the culture audit earlier. Tell us about the process of bringing folks together in one culture.

Levine: I have to tell you, when you think about that, at the grassroots level where care is provided, I don’t think there is very much daylight between our clinical staff at all. They have loyalties to the hospitals they work in and to the direct

Levine: Outside experts come in and talk to board members, management and team members. They look at both cultures and decide where there are gaps. They coach you on the things you need to focus on what you as a governing body need to focus on to bridge those gaps so you can move forward as one organization. It starts with having an understanding, knowing what it is. Once you know what it is, you can develop a plan. This is very routine when there is a merger or union of multiple organizations, to try and understand what drives the culture of each organization in order to bring the organizations together.

Hove: It helps to avoid the pitfalls that would derail some of the energy and effort you saw in the news conference today going forward. We also recognize that the four of us in the room here and working with our boards and the physicians have an obligation as we develop a new company with a new name that it have a new vision and a new culture and approach to how we do business. The culture audit helps us to avoid the historical friction that might still be in existence at some level, but it’s the drivers in this room that have to work through that and set the tone.

BJ: Both systems have a mixed record of maintaining good working relationships over the years with the physician communities. Drawing on that experience and the two existing structures already in place, what can the physicians expect from the new company management and its approach to physician relations?

Levine: Collaboration. Culturally, right out of the gate, we have to encourage physician leadership. Since I got here the two or three major challenges we have faced clinically, when I’ve gone to the doctors, they’ve owned it. They step up.

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SEE ROUNDTABLE, 18 BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

17

| COVER STORY ROUNDTABLE, CONTINUED

They find and champion solutions. We have seen dramatic improvement in our emergency department throughput in the last year, and how we’ve managed the issue of observation – making sure patients are aware of their status and improving documentation, that’s all been physician-led. As you head into a value-based environment, you can’t be successful without physicians. Our role, frankly, is to provide the resources to ensure doctors have the data they need, because it’s a very data-driven environment now – best practices, evidence-based care – and that we properly train the people who work with us to help with those care models. Physicians lead that. We deliver on the things they need to make sure patients get the access to what they need.

BJ: Moving on then, you guys can do everything right and this can still fail. You can’t control what will happen on a macro scale with health care and the American economy. There are around 15,000 people who work for these organizations. There are another 500,000 people in this metro who either eat right or they don’t eat right.

They exercise or they don’t exercise. They have a good attitude or a bad attitude about this whole thing. Are residents of this metro going to play a role in the success of this by what they do with their lifestyles and whether they buy into this?

Levine: No question about it. They have to. Bart said this earlier. We have to encourage people to get involved in this.

Initiatives like accountable care communities and such, that’s what’s happened.

Part of the problem is there are so many things going on to try to affect that, it’s like doing a thousand things, but none of them taking hold, as opposed to leading an effort that’s coordinated and focusing on those things based on data and science and trying to address them. There’s no doubt that various initiatives over time have been very successful. Nationally, you think about the DARE program or Say No To Drugs.

The most successful are generally tied to education and giving people information.

I mentioned earlier the issue of literacy. I can’t think of anything more at the foundation of what the issues are than to make sure a child can read at the third grade level at the third grade. Once they have that 18 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

tool, you can infuse them with knowledge.

They will always make their own choices.

I make bad healthcare decisions all the time. I eat sometimes very poorly and I know it shows. But I’m educated on it and I understand what the limits are, and not everyone does. You have to focus on where the biggest harm is. The addiction problem, for instance. There are reasons for addiction. Part of this is to understand at a science-based level what are the reasons that drive addiction. That tells you how to intervene. If you can move the needle five

to ten percent you have a major impact.

There is no question the community needs to be involved. Schools, ETSU, companies, the employers, we all have to be engaged in it, but it has to be coordinated and wholesome. It can’t just be a machine-gun blast of initiatives. It has to be something meaningful.

Hove: And those are some of the jobs we are talking about creating in this process – people doing things differently to help educate the public.

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| FEATURES

Leaders discuss research opportunities

By Jeff Keeling

Since a Wellmont Health System-Mountain States Health Alliance merger first began being publicly advocated in August 2014, significant potential increases in research funding for East Tennessee State University have been among its touted benefits. After the merger and creation of a “health improvement organization” including ETSU was announced, The Business Journal asked the principal players of Wellmont, Mountain States and ETSU how they see research opportunities expanding in coming years. you’re going to see, and I think Brian’s words were, that the state of Tennessee and the Commonwealth of Virginia have a compelling interest in the success of this because of the economic impact, if we’re successful over time in recruiting the right faculty – who then bring with them the research grants – that’s the key, is to recruit the faculty and retain them.

I’ll give you two specific examples recently. The University of Florida – Shands got $12 million two months ago to study sepsis.

Well, we’ve been doing that and we have some incredible results, but we don’t have the research faculty to go get the grant. The University of Kentucky just got $15 million to study post-acute transitions. Both of our systems have post-acute services and could easily have done that, but we didn’t have the research faculty to go get the grants.

Not only is it research, but it’s also investing in more residency slots, more training programs – not just for doctors but for allied health. We want to become a destination for people who want to practice research or practice medicine that’s very sophisticated.

Noland addresses ETSU’s role in the health assessment. Photos by Adam Campbell

Noland on how a unified system, with one electronic records platform, could enhance ETSU’s ability to capture ETSU President Dr. Brian Noland on the first stages of grants: If you could go from Wytheville all the way down to Greenthe process, prior to official merger: We will conduct a health eville on one E-records platform, that’s going to improve the quality assessment, a needs analysis of the region. That needs analysis will of care, and that also provides a wonderful platform for intervention, then provide the pillars upon which interventions and research are for research. There are few institutions that will have that scale, that based. Randy Wykoff (Dr. Randy Wykoff, Dean of the College of population base that shares the demographic characteristics that we Public Health) and the faculty of the College of Public Health will lead have here. That helps us be very competitive in a national environthat health assessment. Much of the data they already have, but there ment and a national market for research. will be a need for a deeper dive into specific areas.

Levine on the possibility that the new system will seek Mountain States CEO Alan Levine on his recent visit to new avenues for research funding, and also “prime the Florida, where he serves on the board of governors for the pump” with some of its own financial resources: They are to state university system, and some of the research investbe discussed with ETSU. It is clear, in terms of our proposal and our ments he saw there: When I came home, I called Dr. Noland process, there is huge opportunity, whether it be partnering with drug and said, ‘You know, if we’re standing still, we’re moving backward companies – it’s already happening to a small degree in this region because the investments that are being made all over the country – partnering with other sources of private funding, partnering with in what has become a highly competitive environment for research other public sources of funding. And yes, I think you do have to prime funding – we have to do something that’s disruptive. We have to give the pump. So I think to the degree there are synergies, I think we ourselves the platform to get ourselves into that space to compete for want to partner with ETSU so we can make those initial investments. it.’ So I can’t underscore it enough. If you look at the Health Center at ETSU in context of the whole thing, it actually is the largest in the Noland on innovative avenues for funding beyond the state of Tennessee in terms of offering programs. ETSU is a massive traditional research granting agencies such as National vehicle for the state to get into that research opportunity sandbox.

Institutes of Health, National Science Foundation, Centers I came back from that meeting excited for the state of Florida, but for Disease Control and others: There are ARC (Appalachian frustrated because I thought we here could be doing more. I think Regional Commission) options, there are Gates (Foundation) 20 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

options, there are Ford Foundation options, there are options across things like Hechinger Foundation, the Lumina Foundation, because what’s being discussed here touches everything from early childhood education to nutrition to financial planning. The landscape is limitless with respect to how all of these pieces come together. Just the scale we’re working with is going to make us very, very competitive.

Noland on his underlying motivation for seeking greater research funding: Every aspect of the institution is linked towards serving the needs of the people of the region.

I call us the land grant institution for Appalachia, so as we grow research areas and grow sub-specialists, they will be in areas that are identified as areas of needs within the population health study that Dr. Wykoff will present.

Our challenge is going to be insuring that as this moves forward we are building and basing everything off of the population health work, the baseline study, that will be conducted by Dr. Wykoff and other faculty across campus ... we could all sit here and pretty quickly come up with the top four or five challenges that face the region. Dr. Wykoff will validate that and put it to a level of granularity upon which we can plan our hires and plan the development of our research.

This is consistent with other conversations across campus. Right now, (College of Public Health Associate Dean) Rob Pack, who has been leading a committee on the research mission of the institution, is providing a draft of his report to a faculty forum. I’ve read the draft report, the faculty are reading the draft report, we’re going to discuss it at length. As it’s refined, I think you’ll see that report also align with investing in research at the institution that helps move the mission. We’re not going to invest in something that’s not a need here.

I joke about The Wire, which is my favorite television show. You have Johns Hopkins University, one of the best universities in the world, and a block away is abject poverty. If in 40 years we’ve become the top research university in the country for ‘x,’ but x doesn’t exist in our community, then we didn’t achieve our mission goal.

Noland discusses research funding’s role in the new company.

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Mountain States Board Chair Barbara Allen signs the term sheet that begins the merger process with Wellmont. Photo by Adam Campbell

Hospital leaders address the competition question

By Jeff Keeling

W

hen proponents began their concerted push for a Wellmont Health System-Mountain States Health Alliance in earnest, explaining how consumers could be protected was near the top of the agenda.

The Aug. 18, 2014 public forum in Kingsport that shoved the effort into the spotlight included a turn at the microphone by Kingsport attorney Bruce Shine, who introduced what was to most an unfamiliar concept: a Certificate of Public Advantage (COPA).

COPA laws exist in a number of states, including Tennessee, though Tennessee’s never has been used. In essence, they create a mechanism for the state to build a regulatory regime tailored to a particular health care system merger if that merger, on its surface, decreases competition in its market.

The Tennessee attorney general may issue a COPA, according to the state’s “Hospital Cooperation Act of 1993,” if it is determined, “the applicants have demonstrated by clear and convincing evidence that the likely benefits resulting from the agreement outweigh any disadvantages attributable to a reduction in competition that may result from the agreement.” (The full text of the law is available at bjournal.com/copalaw.)

Though Virginia did not have a COPA law when the merger discussions heated up, a similar law to Tennessee’s, but one specific to Southwest Virginia, passed this year with sponsorship by Abingdon delegate Terry Kilgore. An article outlining the bill, which includes a separate link to the entire text, can be found at jcnewsandneighbor.com/ hb2316.

Merger advocates cited what they referred to as a highly successful COPA

agreement that governs the Mission Hospital System in Western North Carolina. The management principals of the proposed newly merged system maintained that contention in an April 2 interview with The Business Journal. After references to Federal Trade Commission concerns about mergers creating monopolies and the relative effectiveness of COPA laws, The Journal asked: “What can you substantively tell local consumers about why they should put any stock in a regulatory or quasi-regulatory structure that would accompany this merger in terms of how it would protect payers, lead to lower costs, increase access and enhance quality of care long-term? How do you explain to the man on the street that regulation can do what you’re saying it would do?”

Mountain States CEO Alan Levine, slated to be executive chairman and president of the new system, said this:

“I point to evidence where it’s been done. I’m not qualified necessarily to pass judgment on the FTC’s view of the marketplace. If you have one broad approach, you neglect the fact that every community in every region is different. Our region is unique from a number of perspectives. It is a very defined ecosystem, very rural, particularly in Southwest Virginia where the unemployment rate is still over 8 percent and the economy is really struggling. We have the second-lowest wage index in the United States. There are some unique features to this region that argue for something unique in terms of how we move forward.

“When we did our study and evaluation of the COPA, we’ve seen where it has demonstrated lower growth in costs. That

22 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

is irrefutable. The evidence is there. So does bringing these systems together risk raising costs and decreasing quality? Those are the two fundamental questions. I think we can answer those very affirmatively that (we can address that). The other option is to go off and do something separately, and you’ve heard all the reasons we think that is not the best solution for this region. You can look at the data about what happens in those scenarios. We don’t think they’re favorable either. In many cases, those have led to higher pricing.

“So the question is, ‘What do you do?’

“We want to make an enforceable commitment – and by the way, this is the only model that gives the state an enforceable commitment in terms of what you will do and how you conduct your pricing and what your quality commitment will be going forward. This is enforceable. So no other model provides that level of certainty to the consumer.”

Added Levine, “We’ll also listen to the insurance companies and their input along the way, as well as, most importantly, some of our employers who have a very sincere interest in making sure it is done properly.

But those issues you raise are understandable. We are really committed to doing this the right way and to making sure the state, the payers and the public are comfortable that there is a mechanism in place to insure we keep our word.”

To see a recent study on Mission’s COPA and its potential lessons for health care, visit bjournal.com/COPAstudy.

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BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

23

| FEATURE STORY

Local governance advocate Greene reflects on road to merger, way forward

“

By Jeff Keeling the “arms race” that had characterized the We’re inside the red zone. hospital systems for around two decades he said, to unnecessary duplication Now we’re going to see if the leading, of services and higher costs. Greene also administration and the new spoke out strongly against any potential boards can function and score. merger with an outside health system, insistthat the loss of local governance would - Bill Greene, Chairman, ing hurt the community in the long run and be BancTenn Corp. irreversible. The meeting, Greene said, “was a turning point.” f a single person from outside Wellmont

A slam dunk did not ensue, however.

Health System or Mountain States Health For one thing, Greene said, Eastman ChemiAlliance might be credited for influencing cal Co. – the region’s largest non-medical their decision to merge, it’s probably Bill employer – wasn’t immediately convinced a Greene. The longtime banker took the local merger would be best for it. And while point when, late last August, the “Save Your Tennessee already had a COPA law, Virginia Hospitals” effort disrupted Wellmont’s did not. strategic options process. He was among

“I think that Eastman was concerned several speakers at a packed community about the COPA, and they were legitimately forum in Kingsport Aug. 21, and advocated concerned about health costs, which they stridently for a local merger with Mountain should have been,” Greene said. A COPA-like States if Wellmont were to merge at all. law was passed in Virginia this winter, and

After April 2’s announcement that a eventually, he said, Eastman, concluded a Wellmont-Mountain States merger was in merger, “wasn’t a bad thought.” the works, Greene reflected on the past nine For his part, Greene said he’s confident months. He said the turning point came the COPA laws will protect consumers and when about 20 prominent businesspeople slow the growth of healthcare costs relative met at his home in early July 2014. Though to what would have occurred with continued Greene claimed a groundswell of support for competition. a Tri-Cities system had been building for 20 Greene, who said he is “going back into to 30 years, Wellmont’s leadership, he said, banking,” returned in conversation several was not considering a local merger in July. times to the importance of local control

“Well when those 20 people, let’s call and the fact that the new system now in the them the hole in the wall gang, agreed, ‘boy, works was designed locally. this is an opportunity, let’s get on this’ – at

“The most important thing is, people that point we were at ground zero,” Greene from the Tri-Cities made it happen. This said. “This deal was dead.” is the home team, played on the home

The Aug. 21 meeting at Kingsport’s court, and the boards of both health science Higher Education Center further turned the organizations stepped up and made the tide, Greene said. It included East Tennesright decisions. The thrill of pulling together see State University President Dr. Brian like the business community did, like the Noland in his first public advocacy for an industry community has, like the hospital academic health system that would capitalize boards and administrations have puts us in a on ETSU’s strong health sciences programs. position to be as good as there is in America The concept of a Certificate of Public Advan- in terms of quality of health and cost. And tage (COPA) that would address concerns that’s really what we were working towards.” about lack of competition also came out

The further inclusion of ETSU will be a at that meeting. And Greene addressed game-changer, Greene added.

I

24 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

“Brian Noland and the med school, the pharmacy school, are going to be phenomenally a part of this, and research dollars are going to change our lives.

They’re going to create new industry, new jobs, that never would have taken place if this had been given away to an outside Bill Greene organization.”

He reserved special praise for Levine, whom he said arrived at Mountain States, “at the right time” (January 2014). And he dismissed rumors that Levine, who is close to and worked for former Florida Gov. Jeb Bush, would bolt for Washington were Bush elected to be president in 2016.

“I think Alan has realized what a phenomenal challenge this is, what a beautiful area of the world he lives in, both peoplewise and geographically and physically, and I think Alan in the long run will put a stake in the ground and say, ‘this is our home. Thank you Jeb, I’ll help you when I can, but I’ve got a big job to do now.’ Alan has fought very, very hard to get this project as far as it is down the road. Now he needs to get it across the goal line, and he can do it.”

Levine won’t be doing it alone, Greene stressed, and the results won’t be insignificant.

“We’ve recruited the players to get in the game, but we certainly haven’t gotten to where this project is going to get. This project will get so much better. It’ll be several years. This is going to be a slow project, but it will be phenomenal. This will be the biggest economic change in our lifetime.”

The 23rd annual recognition of the extraordinary individuals and organizations that go above and beyond the call of duty every day.

Healthcare Heroes are the men and women who go above and beyond the call of duty everyday.

For more than 20 years, The Business Journal of Tri-Cities, TN/VA has honored these heroes on behalf of the business community they serve. Without healthy employees and customers, business cannot survive.

Healthcare Heroes keep our region’s people and businesses well cared for.

To nominate an individual or organization today, email news@bjournal.com with a letter of recommendation telling what makes them a Healthcare Hero. Deadline for nominations is the close of business on May 22nd.

In addition to recognizing general Healthcare Heroes, five special Cup of Kindness© Awards will be presented from the following categories: INNOVATION AWARD: To a provider whose inventive thinking furthered the delivery of care.

DISTINGUISHED SERVICE AWARD: To a provider who has shown leadership and excellent service over a sustained period of time.

COMMUNITY SERVICE AWARD: To an individual or organization for excellence in public health.

MERITORIOUS SERVICE AWARD: To an individual who has shown excellence in administration.

SUPPORT SERVICE AWARD: To a provider for outstanding assistance in the field of health care.

Nominations are judged based on the impact nominees make on the community, the difficulty of their accomplishment, innovation of their work, their leadership qualities and the quality of the nominee’s documentation. The 2015 Healthcare Heroes Luncheon will be held Thursday, July 9th at the Johnson City Country Club.

BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

25

Dentsply’s facility on Rolling Hills Drive. Photo by Jeff Keeling

Washington County, Tenn. IDB approves Dentsply deal

By Scott Robertson

T

he Washington County Industrial Development Board (IDB) last month approved a payment-in-lieu-of-tax agreement with JCM International Inc., a holding company for Tulsa Dentsply, that would keep the company’s 189 local jobs in place, while obligating the company to create 25 new jobs and make a taxable capital investment of $16.6 million over the course of a new 15-year lease.

The county will put $700,000 into the agreement, but will recoup every penny of that through facility rental payments, said Mitch Miller, CEO of the Washington County Economic Development Council.

The agreement, while complicated, works for both sides, said attorney Tom Trent, who represented the county in negotiations.

“Dentsply has approved everything in this agreement.”

Under the terms, $700,000 will flow from the county commission in the form of a grant to the IDB, which will then grant the money to the company. The company will then lend the funds back to the IDB, making the company a lender. The IDB will then charge the company rent, which will allow the payment to service its own note.

This is done, according to Trent, to allow the company to avoid paying certain taxes as an incentive to remain and grow at its current location.

“When an exempt entity such as the IDB leases to a nonexempt entity such as the company, that lease is subject to property tax. That’s what we’re avoiding by doing this,” Trent said. “In Tennessee, to do a payment-in-lieu-of-tax agreement, the property must be conveyed to the IDB and then leased back to the company, because property owned by the government is not subject to property tax. A lease of real estate can have value and that can also be subject to tax, so you can either do an imputed rent or you can do a note. We do an industrial development note, in this case the Series A note, so the county is going to give a grant 26 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

to the IDB for $700,000. The IDB will enter then into a grant agreement with the company for $700,000. You’ll wire it to the closing table when they’re ready to acquire the property. They’ll then put the rest of their money in for expenses and things.

Then they will immediately deed the property to the IDB and the IDB will enter into a facility lease back to the company. All that happens at once. We end up having title at the IDB, which takes it off the tax roll, a lease back to the company, which gives them a building to use.”

Trent explained that the Series A note is for $1.35 million instead of $700,000. “The reason is that the company is going to be putting their own money into the building. Over the course of this up-to-15-year period, they may spend up to $650,000. This way, that is evidenced by the note and increases that basic rent.”

Dentsply, a publicly-traded multi-national company, currently operates locally in the building at 608 Rolling Hills Drive in Johnson City. Under the terms of the agreement approved by the IDB March 24, the county would, through the IDB, grant $700,000 to purchase the building from current owner Caroline Scharfstein. The company will then pay rent to the county beginning in the fourth year of the 15-year lease. Should the company be within 80 percent of its stated goals for job creation and capital investment through the end of year four, the company will begin paying $2,100/month in rent. Each year after that, through the 11th year, rent will rise by $1,000/month. In the 12th year, rent will peak at $10,000/month, where it will remain through the course of the lease.

Trent said while the agreement allows the company freedom from some taxes, the company’s equipment remains taxable by the county. “The personal property will be on the tax roll. That was part of the arrangement worked out between the community and the company.

“The rent has two components, which is a little unusual,”

Trent continued. “Normally we would structure it so the rent the company pays under the lease is equal to the debt service under the note, so the company pays rent to the IDB equal to what the IDB owes the company under the note, so it’s a wash.” The company as tenant essentially pays the rent to itself in its role as lender. That arrangement keeps the lease from having value, said Trent. “That’s in here and it’s what we describe as the basic rental payments. But in addition here, the company is actually going to pay real rent which we call facility rental payments.”

The county is also protected by penalties that automatically kick in should the company fail to meet its stated goals for new job creation and capital investment. Should the company fail to reach either of those goals by the end of the fifth year, the rent rises dramatically, almost doubling in year six and reaching the $10,000/month mark in year eight.

Should the company Dan Eldridge cut jobs to half the stated goal rather than creating new jobs, or should the capital investment be less than half the stated goal of $16.6 million after five years, the rent would immediately jump to $10,000/month and continue rising to $11,487/month by year 15.

At the end of the 15-year lease, the company has the option to purchase the property from the county for one dollar, provided it has come within 80 percent of its goals for job creation and investment and guarantees it will not cut jobs at the facility within the next five years.

Should the company meet its goals but fail to make that guarantee, the buyout cost increases to $193,000. Should the company not meet its goals or guarantee the additional five years of steady employment, the buyout cost reaches $314,000.

Chuck Mason, the IDB member who made the motion to approve the agreement, which was approved without dissent, said the county’s investment, by keeping 189 existing jobs on the books likely saved a significant hit to the taxpayers of the county. “That would be in the 50 to 60 cent range (in property tax),” said Mason.

“I’d have to put pen to paper to come up with the exact number, but it is significant,” agreed Washington County Mayor Dan Eldridge.

Creation of the agreement was delayed while the numbers were refigured after the company

negotiated a lower purchase price from Scharfstein. The property, which is appraised for tax purposes at $1,331,500, was originally valued for the purpose of the transaction at $1 million. That was the amount approved by the Washington County Commission for the project in a 19-4 vote Jan. 26. When the company bargained for the $700,000 price over the last few weeks, the county adjusted the plan accordingly.

The company is expected to close on the sale of the property at mid-year. “That will happen around the end of June or beginning of July,” Eldridge said.

“That a strong company like Dentsply is committing to Washington County is significant,” Miller said. “It’s a great company and this is a great deal. This will not only keep jobs here but also help a company grow here in Washington County.” The county successfully competed against three Mitch Miller communities in the state of Oklahoma for the Denstply expansion.

Eldridge, who negotiated a good deal of the final language with the consultant, said he regretted the fact that some media coverage created a sense of uncertainty for the company’s local employees. He said those in the community who saw the project as a giveaway never understood what the county would receive in return over the course of the lease, and that those who thought the county was being blackmailed to keep existing jobs never understood that the incentive package was offered to encourage the company to bring new jobs and investment to the community.

“I’ve been asked what we’d do if another company wants us to do a deal like this to keep their jobs here,” Eldridge said. “If they’re offering to create new jobs and bring new capital investment, I would welcome the opportunity to do something like this again.”

Said Miller, “I would hope that the county commission and the taxpayers would be very comfortable knowing that they’re going to have to put out less than what they thought they were going to have to put out there. There are performance measures in place regarding job growth and taxable capital investment. Everything here should give the county extreme comfort.”

BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

27

| FEATURE STORY

John Tickle of Strongwell Hometown boy makes good – for five decades

By Scott Robertson

M

ost people who know John Tickle today know him as Chairman of the Board of Strongwell Corporation, headquartered in Bristol, Va. Some know him as a remarkable fundraiser. Some know him as part of an influential group of businesspeople who worked with banker Bill Greene recently to influence the Wellmont merger process. But few know that this month he is celebrating 50 years in the industry he has helped shape.

That last statement isn’t hyperbole. Strongwell today has 647,000 square feet of manufacturing space in its three manufacturing locations. The company utilizes 62 pultrusion machines and employs more than 500 people.

All of this makes Strongwell the world’s largest and most advanced pultruder of composite structural components.

It all began when one of Tickle’s professors at the University of Tennessee in 1964 recommended Tickle to a recruiter from Owens Corning Fiberglass. When Tickle saw what was being done at the Owens Corning Tech Center in Granville, Ohio, he says, “I knew within about five or ten minutes this was where I wanted to be.”

So the day after graduating from UT with a degree in industrial engineering, Tickle found himself on the job. “I never had time to tour Europe or ‘find myself,’” he says. “I graduated in Knoxville Thursday and reported to work in Granville on Friday. I had a wife and a child and I needed to be on somebody’s payroll with some health insurance.”

Two weeks later, Tickle was brought in to a plant in Centralia, Ill. as an “outside expert.” He had been out of college 15 days. “I was more than 25 miles from home,” he says, “so there you go.”

Within two years, Tickle had built a strong reputation and was getting job offers from several other manufacturers. “I seemed to be lucky to be in the right place at the right time to have people interested in me.”

He went to Justin Enterprises in Cincinnati to be plant manager, moving up to become general manager by the age of 26. Three years after that, he was recruited to make fiberglass folding chairs at Krueger Metal Products in Green Bay, Wisc. “I was willing to work hard,” Tickle says. “The harder I worked, the more responsibility people were willing to give me.”

28 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

One cold December, “We had old material 1971 evening in Green Bay, and old equipment,” Tickle got a call from Bob he says. “The building Morrison in Bristol saying where our products were Morrison had taken over made was built in 1924. a manufacturing concern At the time, we were here and was looking for the leader in pultrusion a president and general but we were doing all manager. At the time, Tickle these other processes. says, Morrison had no idea Our equipment was old Tickle was from Bristol. and we had customers

“I was sort of a cheap other people didn’t date,” Tickle says of his first want. So I started interview with Morrison. getting out of those “I spent the night at my John Tickle made the former MMFG to be a world leader in pultrusion. Photos by Adam Campbell processes and started parents’ house.” selling equipment to

Morrison offered finance what I wanted to Tickle the position of president of Morrison spring of 1972, John Tickle returned home do with pultrusion. We were No.1 then in Molded Fiber Glass Company (MMFG, now to Bristol. pultrusion and we’ve grown that ever since.

Strongwell). The only hold-up came when

“It was challenging, but it was fun,” I believe we’re respected around the world Krueger wanted six months notice instead Tickle says of the turnaround process. “I now for our pultrusion process.” of two weeks. Tickle negotiated that down wasn’t willing to fail, and frankly I couldn’t The company has been profitable every to three months before calling Morrison to allow myself to fail. I had come back here year since refocusing its efforts on that give him the bad news. Morrison, “about at 30 years old to be president and general process, but it hasn’t always been easy. “In went crazy,” Tickle says. “But I told him manager of this company.” the 1970s times got real tough for a while,” I had given them my word. I’m an Eagle

Tickle refocused MMFG’s resources Tickle says. “The salaried people took a 10 Scout and I like to keep my word. So in the and changed its management structure.

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TICKLE, CONTINUED

percent pay cut and I took a much larger cut than that. Our hourly teammates did not take a pay cut. When things got better I was able to make it up.

“When things got tough and I had to make cuts, I’d take my salary out first. I had to make that payroll. I had to pay our suppliers. I had to pay taxes. I knew I had to take care of the business, not to try to make the business take care of me.”

The key to the success of the company, Tickle says, has been its people. “I hired people with good work ethics, who were smart and had people skills. I’ve tried to run my personal life and my business life by the Scout Laws and the Ten Commandments. So I treated my employees right, and they treated me right.”

Those people have stayed with the company, Tickle says, because loyalty has always been a two-way street. “I’ve been hear 43 years this month, and we’ve never had a layoff. If I hire somebody, I have a responsibility to take care of them and their

John Tickle circa 1965

family because they’re doing their best to help me out.”

In 1993, Tickle, with the help of one outside investor, was able to purchase the company from Shell Polymer Ventures, which had owned the company since 1985.

By 2000, Tickle and members of his family had acquired all shares from the outside investor, transforming Strongwell into a debt-free, family-owned corporation.

Today, although Tickle leaves the day-to-day management of Strongwell to a trusted set of leaders, he remains involved in key strategic decisions, as well as providing mentorship and guidance, and other duties related to his chairmanship of the company.

Tickle no longer feels the pressure of not being able to let himself fail. That’s no longer a worry. So what drives him today?

“It’s fun,” he says. “The work is exciting.

I love it, and I don’t see myself quitting anytime soon.”

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| ON THE MOVE Administration

Jeffrey Hodge has been named vice president of New Business Development for NN Inc. This is a new position for the Johnson City-based Jeffrey Hodge manufacturing company, created for the purpose of helping achieve aggressive growth targets for the metal bearing components division. Since 2009 Hodge has served as general manager and vice president of the Tennessee and Kunshan China facilities of NN, overseeing a revenue growth of 35 percent. During this same time period he’s also witnessed impressive growth of the corporation, which continues to redefine itself through acquisitions and market penetration.

“I am excited to be a part of NN Inc., a great American success story which began in East Tennessee, and excited about the direction of the company,” says Hodge who got his start in manufacturing while attending graduate school at ETSU in the 1990’s.

In the new role as vice president of new business development Hodge will work closely with the global operations team to expand into new geographic regions and new products, building upon existing core competencies while expanding the product portfolio.

Health Care

Lisa Smithgall has been named vice president of patient care services at Holston Valley Medical Center, where she will begin April 20 .

Smithgall most recently served as associate vice president of nursing for

32 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

Geisinger Medical Center in Danville, PA., since 2012.

During her tenure, she oversaw a number of units, including adult intensive care, telemetry, orthopedics and Lisa Smithgall respiratory therapy.

Smithgall previously served in health care leadership roles in the Tri-Cities for 20 years, and will become a member of the executive leadership team for Wellmont Health System’s largest hospital. Smithgall will be responsible for the overall quality of nursing care at Holston Valley, which includes the critical care, cardiovascular, medical/surgical and trauma units, as well as the emergency department and other patient care services.

From 1992 until 2012, Smithgall worked for Mountain States Health Alliance, concluding her Mountain States career as vice president of the women’s strategic service unit after the health system split the leadership responsibilities for women and children.

Dominion Senior Living has named Michelle Bolling as its executive director.

Bolling has nearly 15 years’ experience working in healthcare and senior living Michelle Bolling communities.

“Our employees are the ones who ensure that our message of serving seniors is achieved each day,” said Dominion Senior Living vice president

Josh Crisp. “Michelle has such heart for helping others and an extensive background working with seniors while managing and appreciating staff. We know she’ll go above and beyond to make every resident and staff person a priority and create a familylike atmosphere.”

Bolling completed her associate’s degree at Northeast State Technical Community College, bachelor’s degree from Milligan College and Masters of Business Administration from King University.

She has been certified in Tennessee as an administrator at Adult Care Living Facilities (ACLF) since 2003 and stays updated on the latest procedures through continuing education courses. She received the Assisted Living Federation of America’s (ALFA) “Champion for Seniors” Award in 2010 and attended their Executive Director Leadership Institute in 2013.

Bolling is responsible for hiring key staff of Dominion Senior Living of Johnson City.

Finance

Lois Carrier has been named president and CEO of Carrier, Maurice and Webb Wealth Advisors.

Carrier, an industry veteran with more Lois Carrier than 25 years of experience in wealth advisory services is a founding principal, and visionary of the firm. Founded in 2002, Carrier, Maurice and Webb is the second financial services firm in which Carrier has served as a principal. In 1993 Carrier earned the Certified Financial Planner designation.

| AWARDS & ACHIEVEMENTS TRI wins governing body of the year award

Tri-Cities Regional Airport, TN/VA has been selected as the 2015 Governing Body of the Year by the Tennessee Aeronautics Commission. The Airport received the award based on the many changes it has undergone in the past few years, both in its governing structure and facilities improvements.

The airport’s change from a commission structure to an authority was of particular significance in TCRA’s selection for the award, which was presented to Patrick Wilson, TCRA executive director, at the annual Tennessee Aviation Association awards banquet in Nashville. Bill Orellana, the director of the Aeronautics Division of the Tennessee Department of Transportation, noted that the change to an authority was time consuming and complicated, requiring agreement from the city and county owners, the legal transfer of properties to the Airport Authority and approval from the FAA. It was also noted that this governing change occurred simultaneously with major facilities improvements and expansion. Orellana particularly singled out the terminal access road improvement project that is underway, the expansion to corporate aviation facilities, the total rehabilitation of primary Runway 5/23 and the Taxiway R extension.

“Tri-Cities Regional Airport is an important part of the regional economy of Northeast Tennessee and Southwest Virginia,” said Jim Rector, TCAA chairman. “The members of the Airport Authority board do a great job of representing their cities, counties, and the entire region through their work at the airport. I appreciate the State of Tennessee presenting us with this award and I am proud of what has been accomplished over the past several years.”

This annual award recognizes one airport out of the 75 general aviation and commercial airports that operate in Tennessee.

For more information about Tri-Cities Regional Airport, visit TRIflight.com.

Hillhouse Graphic Design wins three 2015 AVA Digital Awards Creative work by Hillhouse Graphic Design LLC, a 31-year-old design and communications firm based in Kingsport, recently garnered three awards in the international AVA Digital Awards competition and a Silver ADDY from the American Advertising Federation of Northeast Tennessee (AAF-NETN).

The firm received an AVA Digital Platinum award for “Outcasts: Surviving the Culture of Rejection,” a documentary film written and directed by Stephen Newton and produced by Jane Hillhouse. Hillhouse also achieved AVA Digital Gold for development of a Tennessee Watercolor Society website and Honorable Mention for another site created for Lice Treatment Center, a company based in Monroe, Conn. Justin Dickenson, Hillhouse’s director of web development and technical services, was project manager for both winning websites.

AVA Digital Awards is a global competition administered and judged by the Association of Marketing and Communication Professionals (AMCP), an organization comprised of several thousand creative professionals.

The 2015 AVA Digital Awards received approximately 2,100 entries from around the world. About 14 percent of the entries won the Platinum Award and about 16 percent were Gold Award SEE AWARDS & ACHIEVEMENTS, 34 BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

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| AWARDS & ACHIEVEMENTS winners. Judges evaluated entries based on perceptions of creative excellence.

The Silver ADDY that Hillhouse received from the AAF-NETN was for a “Mail Pouch” T-shirt designed by Art Director Jay Huron for the International Storytelling Center, Jonesborough.

AAF-NETN is a local branch of the American Advertising Federation, the nation’s oldest national advertising trade association.

ency at every level of the company.

Scores are generated in five key categories: ethics and compliance program (25 percent), reputation, leadership and innovation (20 percent), governance (10 percent), corporate citizenship and responsibility (25 percent) and culture of ethics (20 percent).

The full list of the 2014 World’s Most Ethical Companies can be found at ethisphere.com/worlds-most-ethical/wme-honorees/.

Eastman makes ‘most ethical companies’ list

Eastman Chemical Company has been recognized by the Ethisphere Institute as a 2015 World’s Most Ethical Company for its efforts to continually raise the bar on ethical leadership and corporate behavior.

Eastman has a number of policies and initiatives in place that allow its team members to cultivate a culture of integrity and ethical standards. The company has an Office of Business Conduct that establishes the Code of Global Business Conduct. The Code outlines the laws, principles and guidelines all employees follow regarding honesty, integrity and responsible corporate behavior.

Annual training on the Code of Global Business Conduct is required for all employees. Additionally, the Business Conduct Helpline, which is a confidential, 24-hour “hotline,” is available.

The line provides an anonymous means for employees to report suspected violations and is staffed by third-party specialists.

The World’s Most Ethical Companies designation recognizes those organizations that have had a material impact on the way business is conducted by fostering a culture of ethics and transpar-

Firm recognized for Founders Park engineering

The engineering firm that designed Johnson City’s Founders Park has won a national award for its work on the project.

LDA Engineering has earned a National Recognition Award for exemplary engineering achievement in the American Council of Engineering Companies’ (ACEC) 49th annual Engineering Excellence Awards for Founders Park.

According to a release from ACEC, “Johnson City’s decades-long downtown flooding problems are a thing of the past thanks to this $4.5 million project that replaced 700 feet of the 70-year old Brush Creek triple barrel box culvert, located beneath an old warehouse, with an environmentally enhancing channel.

“In addition, a new five-acre park was constructed to provide citizens with a beautiful new public gathering area that includes a creek-side amphitheater for performances and other events.”

As the first step in the city’s master plan, Founders Park is already providing benefits to downtown Johnson City, with several new construction and historic building renovations underway.

Numerous small businesses have also relocated downtown.

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ETSU pair elected to national public health posts

East Tennessee State University’s College of Public Health Dean Randy Wykoff and Associate Dean Rob Pack have been elected by their peers to serve in senior leadership positions in the Association of Schools and Programs of Public Health (ASPPH).

ASPPH is the membership organization for all schools of public health and graduate programs in public health that are accredited by the Council on Education for Public Health. Currently, ASPPH membership includes almost 100 different universities across the United States and in several other countries.

Pack, who also serves as a professor in the Department of Community and Behavioral Health at ETSU, has been elected the co-chair of the Academic Affairs section for ASPPH. Academic Affairs is one of four sections in ASPPH that offers professional development networks for senior faculty and staff with primary administrative responsibilities.

In this elected position, Pack works with staff to provide leadership for the group that includes associate deans for Academic Affairs and program directors from other ASPPH member institutions.

Wykoff, who is also a professor in the Department of Health Services Management and Policy at ETSU, has been elected to serve as the chair of the Education Committee for ASPPH, and in this capacity, will also serve as a member of the ASPPH board.

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| NEWS BRIEFS

Evolve abandons plan to redevelop Johnson City mill property

By Scott Robertson

A controversial and long-delayed deal to put a five-building apartment complex on the former General Mills and Mize Farm and Garden properties between East Tennessee State University and downtown Johnson City is dead.

Multiple sources confirmed April 7 that Evolve Development of North Carolina would terminate its purchase contract with the Chamber of Commerce Foundation, owner of the 4.8-acre General Mills property. First announced in late 2013, Evolve’s $18 million plan faced numerous zoning and legal hurdles, as well as significant community opposition, but appeared to have overcome those with the recent dismissal of lawsuits.

Gary Mabrey, president and CEO of the Chamber of Commerce serving Johnson City, Jonesborough and Washington County, told The Business Journal the chamber had received

notification Evolve is withdrawing from the project, but that no formal statement would immediately forthcoming.

The project faced opposition from some nearby business owners and some residents of the adjacent Tree Streets. Reasons included opposition to a large “rent-by-the-room” student apartment complex, as well as opposition to the demolition of what some deemed an historic structure worth saving.

“I am looking forward to working with the Chamber and any future potential buyers there,” City Commissioner David Tomita said. “I think that’s an important spot. I still believe mixed use (including some commercial) is the best use.

Let’s figure out how to do what’s best for the community, and I think we’ll have those options before us very soon.”

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| THE LAST WORD

The big healthcare merger: What should our role be?

By Jeff Keeling

O

ur sister publication, The Johnson City News & Neighbor, recently ran some excellent track and field photographs by a new contributor, Dakota Hamilton. One shows University High School’s Jarod Smith pole vaulting at last weekend’s Tri-Cities Track Classic.

Pondered long enough, the thought of a person sprinting down a path with a really long stick in hand, jamming the stick into a crevice, and holding on for dear life as the stick rises 14 or more feet in the air only to let go at the apex – well, it can lead one to question the vaulter’s sanity. Yet we generally put such thoughts aside and applaud the athletes’ skill and determination.

Hamilton is a graduating senior at East Tennessee State University, a psychology major with dreams of photographic success. The Gate City, Va. native’s website reveals his ambition: to one day be on the sidelines of a major professional sporting event, shooting for a major sports coverage provider.

A small-town kid, he appears to exemplify ETSU President Dr. Brian Noland’s oft-repeated contention that a major element of the university’s mission is to help improve the lives of the region’s people.

The pole vaulter and the photographer both display an enthusiastic, hopeful audacity observers tend to find refreshing.

In arenas that stir their passions, they strive to overcome challenges and reach levels of excellence that fulfill them and draw notice and appreciation from others. Those with some stake in their success – coaches, parents, friends, mentors – are called to nurture and guide them with the right combination of pure encouragement and wise counsel.

To blithely lavish praise without expecting accountability paves a road to unrealistic expectations, and ultimately, dejection when failures come, as they will. It is the “everyone’s a winner, you can do anything you put your mind to” side of a worthless coin. Its flip side is counsel and “support” that is cynical, defeatist, or so critical as to be destructive and not constructive. I hope Hamilton and Smith, in whatever endeavors they choose, receive good mentoring, coaching, counsel and oversight.

On April 2, a collection of people more powerful and influential than Hamilton or Smith gathered in Kingsport to announce their own audacious proposal: the merger of the region’s two dominant hospital systems into a “health improvement organization” whose aims will include cost containment and improved population health in this admittedly high-priced, woefully unhealthy region. Flipping the health care model toward more preventive and primary care and addressing chronic problems from preventable diseases to drug abuse – all of 38 The Business Journal of Tri-Cities TN/VA | April 2015 | BJournal.com

which cost our region blood and treasure in terms of economic strength and quality of life – is a top priority.

To help this effort, the leaders of Wellmont Health System and Mountain States Health Alliance say they’ll enlist East Tennessee State University and its broad-based health sciences program. Increased grant funding, appropriate and costeffective delivery of care, and very likely a significant change in the type and number of jobs devoted to getting and keeping our population healthier all are in our future, the leaders suggest.

The proposal would, to a large extent, eliminate competition and consumer choice in the market. To launch this revolutionary endeavor, the systems must first gain state approval for a regulatory structure designed to insure the lack of competition is mitigated by verifiable, enforceable mechanisms to maintain better cost control and quality of care than would be possible in a standard competitive marketplace.

The prospect of vanishing competition is a justifiable cause for concern, but this whole big story – which really is just beginning – boils down to two possibilities. One is that the influential people who say they support the effort, including huge employers who pay a lot for health care, have ulterior motives.

The other is that the same people are convinced that, in today’s broader health care climate, the region’s status quo represents an irreversible path toward decline in our population’s health, our economy and our overall quality of life. Such a conclusion also accepts they have put their passion, skills and energy into constructing an initial framework for change they believe can, fully implemented, offer the best possibility of improving our people’s health, growing the economy, and protecting consumers.

Audacity is defined as “the willingness to take bold risks.”

I’m not sure who, made aware of our regional health challenges, would argue that something audacious isn’t in order to address the tremendous health care challenges that ripple through every aspect of people’s lives.

Sullivan County Mayor Richard Venable, following the April 2 news conference, said he believes the proposed change is, “going to lift everyone up.” He added this: “And it can be successful only if this region wants it to.”

As a journalist, my role in this matter includes investigating the facts as they are presented or uncovered. Our publications’ roles include conveying those facts fairly and objectively to the public and holding accountable the leaders who are carrying out this plan. Other people in other walks of life not directly involved have their own roles in this monumental endeavor.

My hope is simply this: that like the people who love and guide Dakota Hamilton and Jarod Smith, we act neither as unquestioning cheerleaders nor as hypercritical, cynical, defeatists. Frankly, both of those approaches can be easier than charting a middle course. In the matter at hand, the stakes are too high for the easy way out.

BJournal.com | April 2015 | The Business Journal of Tri-Cities TN/VA

39

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