Two local hospitals seeking to replace Blood Bank of the Redwoods

Santa Rosa Memorial Hospital and Petaluma Valley Hospital are extending a deadline for blood suppliers to bid on the hospitals' contract.

The two hospitals, which had been expected to announce a contract today, are seeking a less expensive source of blood. They want more time to receive bids from suppliers and have pushed back the deadline to mid-June, said Tom McHugh, director of lab services for the hospitals.

The hospitals notified longtime supplier Blood Bank of the Redwoods in late April that they planned to terminate its contract, effective July 29.

The two hospitals, operated by St. Joseph Health System-Sonoma County, had been attempting to negotiate lower prices since last fall when the blood bank implemented its annual price increase, McHugh said.

While they tried to negotiate, the hospitals refused to accept the rate hike and continued to purchase blood at the old price, he said.

The blood bank said Thursday it is now owed $50,000 by the two hospitals. The hospitals have agreed to pay the bill, McHugh said, "even though we didn't think it was fair."

Blood bank spokesman Kent Curley said its prices are reasonable and fall within the middle of blood bank pricing in Northern California.

"Certainly, it is their obligation to cut costs wherever they can," he said, "but our pricing has such minimal margins and we have such great efficiencies that we can't cut any more."

The nonprofit Santa Rosa blood bank, the only major blood center on the North Coast, has supplied blood to the hospitals on one-year contracts for nearly 60 years, Curley said.

The two hospitals sent a 90-day notice to terminate their contract with the blood bank April 29, and have since sent requests to several other blood suppliers for bids, spokeswoman Katy Hillenmeyer said.

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