Ballad Health announces more than $310 million investment in rural Southwest Virginia to improve community health and workforce

Agreement leads to restructuring of hospital partnerships, unleashes major funding for the community

Actions by Ballad Health are unleashing more than $310 million of investment into two community foundations that will improve quality of life and access to healthcare in rural Southwest Virginia.

The health system has partnered with both the Wellspring Foundation (formerly the Johnston Memorial Healthcare Foundation) and the Smyth County Community Foundation in agreements that restructure both long-time hospital partnerships and pave the way for new population health initiatives and investments throughout Southwest Virginia.

“The partnerships between Ballad Health and these two community foundations have been some of the most productive and successful I’ve ever seen,” said Ballad Health Chairman and Chief Executive Officer Alan Levine. “Both the Wellspring Foundation and the Smyth County Community Foundation have been steadfast supporters of Ballad Health’s mission, and similarly, we strongly support their goals and visions for the future. This announcement is historic in terms of the resources it will unlock.”

Ballad Health, through its subsidiary, Mountain States Health Alliance, has been the majority owner of Johnston Memorial Hospital and Smyth County Community Hospital, utilizing its capital upon acquisition of the majority stake in each hospital to build new hospitals serving the people in Southwest Virginia. In each partnership, Ballad Health has been the managing partner, leveraging its expertise to operate the hospitals.

Through the terms of the new agreements, Ballad Health will become the sole owner of both Johnston Memorial in Abingdon, Virginia, and Smyth County Community in Marion, Virginia. Previously, Ballad Health owned 50.1% of Johnston Memorial and 80% of Smyth County Community.

By restructuring the partnerships, more than $310 million can be opened and invested into the local community foundations, which will support other charitable organizations, community health initiatives, educational activities, workforce development and education for the healthcare workforce in Washington, Russell, Smyth, Wythe and Grayson counties, among other initiatives consistent with the goals agreed to by each foundation and Ballad Health.

“This new partnership brings the best of all options to Southwest Virginia,” Levine said. “The hospitals will continue to be operated by people the communities have become familiar with, while at the same time, unleashing historic investment into the communities served by these critically important assets we have also invested so much in. The relationship we have with the people of Southwest Virginia could not be more important now that we are moving forward together with these exciting initiatives.”

Ballad Health’s partnership with the Wellspring Foundation began with the construction of a state-of-the-art facility for Johnston Memorial, which opened in 2011. Since then, the partnership’s success has been illustrated by the hospital’s recent four-star ratings by the Centers for Medicare and Medicaid Services’ hospital compare program. Johnston Memorial also meets or beats Commonwealth and national outcomes in multiple areas, including percentage of patients who receive appropriate care for severe sepsis and septic shock; percent of patients who came to the emergency department with stroke symptoms who received timely, appropriate diagnostics; and rates of death tied to heart attack, pulmonary disease, heart failure, pneumonia and stroke.

“Together, through this incredible partnership, we have built a successful hospital which has saved lives, served the community, and been a source of pride for the region,” said Bill Hayter, chairman of the Wellspring Foundation. “We are proud of the relationship we have with Ballad Health, and we are grateful to them for their expertise, focus and commitment to high-quality care for our families and neighbors. By every measure, this has been a hugely successful partnership, and now, we are ready for the next step in that relationship.

“Along with responsible stewardship of the hospital, which has led to high quality, we have been good financial stewards. Our fiscal management of this hospital has led to the investment – and powerful community impact – we are now proudly able to make.”
Johnston Memorial’s leadership structure will remain unchanged, as will its patient services.

“The Wellspring Foundation has done incredible work in the community for more than a century, and now they’re on board to bring health improvement beyond hospital walls and into the broader community,” said John Jeter, chief executive officer of Johnston Memorial. “This will allow us to take a 21st-century approach to healthcare, and it’s going to make a real generational impact.

“We’re ready for the next stage of healthcare in our region, and we’re so honored to be working with the Wellspring Foundation to advance healthcare in our communities. We are here to drive healthcare in Southwest Virginia, and we think the best way to do that now is to support partnerships like these.”

Sean McMurray, Ballad Health’s senior vice president of market operations and service line integration and development, will be stepping down from his position at Ballad Health to accept the role as executive director of the Wellspring Foundation. McMurray, who served as the chief executive officer of Johnston Memorial when the current facility first opened, will leave his current position on Wednesday, Dec. 8.

“As chief executive officer of Johnston Memorial Hospital when it was first acquired by Ballad Health’s predecessor, I was around to see just how much work went into creating this new facility and building an incredible team,” McMurray said. “I’m proud of the decisions we made all those years ago, and I’m confident we’re making the right decision now. This will help us solidify quality, accessible healthcare for years to come in these communities, and we have great confidence Ballad Health will continue to operate a great hospital in our community and continue the wonderful work of Johnston Memorial.”

Ballad Health’s partnership with the Smyth County Community Foundation has also proven successful. Earlier this year, Smyth County Community Hospital was awarded a Five Star Overall Rating and Patient Experience Rating from the Centers for Medicare and Medicaid Services – the only hospital in Virginia to earn the patient experience rating.

“This agreement is the result of months of careful, deliberate discernment about the most effective ways the Foundation can support the long-term viability of Smyth County Community Hospital, a source of pride for our entire region,” said David Kiser, MD, of the Smyth County Community Foundation board of directors. “Our mission has always been to support efforts that benefit the health of our community, and that mission is not changing. We’ll continue to partner creatively with Ballad Health to create positive change and diversify the pool of health-focused resources in our region.”

The Smyth County Community Foundation plans to pledge an immediate $3 million investment to address substance abuse in the region through a grant program that will benefit the newly formed Appalachian Center of Hope. Moving forward, the foundation will partner with Ballad Health to develop plans that will address health needs to care for an aging population, initiatives to improve health and education for the area’s youth and resources to provide holistic substance abuse prevention, care and treatment.

“The formation and impetus behind Ballad Health has been unchanged for our three years in operation – we’re going to do all we can to improve overall health and well-being for the Appalachian Highlands, and we’re working especially hard to reach into our most rural areas,” said Dr. Chad Couch, president of Ballad Health’s Northeast Market, which encompasses both Johnston Memorial and Smyth County Community. “It’s a heady task, and we can’t do it alone – and that’s why we are so grateful to be able to work with the Wellspring Foundation and Smyth County Community Foundation to offer innovation and assistance to people and organizations that need it most.”

The $310 million investment is intended to improve health and healthcare for the region served by Johnston Memorial and Smyth County Community. Ballad Health and each community foundation will begin immediate work identifying options for enhancing behavioral health services for the community.

Additionally, a community board for both hospitals will be established, with both foundations maintaining involvement in their respective local governance. Additionally, there will be no reduction in services provided by Johnston Memorial or Smyth County Community.

Strong support from the legislative delegation

“This is a fantastic opportunity for our community,” said Virginia State Sen. Todd Pillion. “Through our collaborative efforts, Southwest Virginia is working to reverse the trend that most of rural America is experiencing in terms of dwindling healthcare resources and hospital closures. The significant community investment announced today follows the reopening by Ballad Health of Lee County Community Hospital earlier this year and demonstrates the shared commitment to moving our region forward. I welcome this exciting news and look forward to more announcements in the future.”

“I am so grateful to the leadership of both community foundations for their stewardship of the hospital in partnership with Ballad Health,” said Virginia State Del. Israel O’Quinn. “I also appreciate Ballad Health recognizing the value created for the community by unleashing these resources. The potential created by this investment is massive, and I look forward to working with the foundations and Ballad Health to see how we can use this investment to enhance our region.”

Virginia State Del. Jeff Campbell said, “It’s an honor to witness the work of the Smyth County Community Foundation. Ballad Health’s investment into Smyth County will help support drug abuse education, counseling, and treatment programs right here at home. We know certain social determinants of health can lead to the use of illegal drugs, so we must work together on community-based solutions if we are going to be successful in keeping our region healthy.”

“This announcement speaks to the power of community investment and partnership,” said Virginia Del. Will Wampler. “Through prudent fiscal stewardship, Ballad Health will now have the opportunity to invest in our communities in ways we never thought possible. I will work hard with our delegation to do everything we can to leverage these dollars through partnerships with the commonwealth, universities and community organizations to ensure the outcomes we all hope will follow.”

“More than a decade ago, people in Abingdon took a leap of faith when they chose to work with us,” Levine said. “Ten years later, I believe it can credibly be said that Ballad Health kept its word, managed the hospital prudently and responsibly, and today, the community will reap important ongoing benefits from that choice that was made all those years ago – just as the Marion, Virginia, community will benefit from our ownership of their hospital.
“These partnerships are robust and will continue. I can’t wait to see what the next 10 years – and beyond – will bring.”

Learn more about the Smyth County Community Foundation.
Learn about the Wellspring Foundation.