Stanford stunner: $1 billion expansion
PROJECT WOULD ADD 248 BEDS, 1.3 MILLION SQUARE FEET TO PALO ALTO CAMPUS

By John Mugford

 

PALO ALTO, Calif. – Stanford Hospital & Clinics officials recently unveiled plans for a massive $1 billion rebuilding and renovation plan at its hospital campus at Stanford University in Palo Alto.

The project is being driven by California’s seismic safety standards for acute-care facilities, increasing demand, and a desire on Stanford’s part to upgrade its facilities with the latest in technological advances. Part of that includes privatizing all of the patient rooms in its two hospitals – making the rooms large enough for family members to be comfortable while visiting patients.

The plan calls for tearing down portions of the main Stanford Hospital that were built in 1959 and 1973, thereby leaving in place a 440,000 square foot wing that was built in 1989. That wing would be incorporated into the new and expanded hospital building. When the project is complete, the rebuilt hospital would add a total of 144 new beds, bringing its total to 600.

Overall, the project at the main Stanford Hospital would entail razing about 700,000 square feet of current space and constructing about 1.4 million square feet of new space. That would mean a net gain of about 730,000 square feet.

In addition to spending about $500 million on that project, Stanford officials also revealed plans to upgrade and renovate the adjacent Lucile Packard Children’s Hospital. The children’s hospital, which is facing a space crunch, would gain 104 new beds and an additional 425,000 square feet of space, bringing its total to about 250 beds. Some of the new space would be used for new diagnostic and treatment services.

Stanford officials recently presented their preliminary plans to the Palo Alto City Council, which would need to approve the project before the system can proceed. As part of its proposal, Stanford will ask the council to waive the city’s 50-foot maximum height allowance, thereby paving the way for the Stanford Hospital’s 115-foot, seven-story main structure. The children’s hospital would grow to 85 feet.

Stanford officials say the extra height is needed because land is at a premium in the Stanford University area and the most logical and efficient way to expand is upward.

According to several local news reports, Palo Alto council members met the preliminary proposal with a bit of a mixed response at a meeting held in late November. At least a couple of council members expressed concern about the added traffic the project could bring to the congested area, as well as its potential impact on the environment.

However, other council members noted that while the size and scope of the project presents challenges, the city considers Stanford University and its hospitals to be integral parts of the community.

In an article in the San Jose Mercury News, Councilman Jack Morton said: “Stanford is the heart and center of this community. There’s no doubt this community will make sure the project goes forward.”

Stanford officials plan to submit a formal application to the city in early 2007 and would like to break ground in 2009. Plans call for completing the children’s hospital in 2013 and the main Stanford Hospital in 2015.

Other aspects of the overall project, which include replacing 415,000 square feet of outdated laboratory facilities at the Stanford University School of Medicine as well as building new medical office buildings, would be complete by 2025.

Once devastated

New Orleans hospital

finally reopens

NEW ORLEANS – There’s another cause for celebration as New Orleans and its healthcare industry continue to rebound from the destruction wreaked by Hurricane Katrina back in late August 2005.

University Hospital, which is part of LSU Healthcare Services and which had been shuttered since Katrina struck, reopened in late November with 85 beds and 14 operating rooms.

The 85 beds is a far cry from the 200 or so beds that University once staffed, but it’s a step in the right direction, according to local healthcare officials. Prior to the devastation wreaked on the Crescent City by the massive hurricane, University and its next-door neighbor, Charity Hospital, provided about 500 beds. Charity, however, was damaged beyond repair and will not reopen.

University officials say their goal is to eventually staff about 150 beds – a nursing shortage, however, has sidelined that prospect.

University is reopening the hospital in three phases over the next several months at a total cost of about $64 million, according to officials. The remaining two phases of the reopening are expected by March 2007. The much-needed trauma center is expected to open in January – until then University’s trauma center is being housed at Elmwood Hospital.

The $64 million for the rebuilding project came by way of the Federal Emergency Management Agency (FEMA), which is requiring that LSU officials call the hospital the LSU Interim Hospital until the reopening is complete and trauma services are provided.

Meanwhile, LSU continues to seek $300 million in federal grants to build a new hospital in New Orleans in partnership with the Veterans Affairs Department (VA). officials expect an answer by mid-December.

Boston Children’s

plans 60 new beds

atop main hospital
BOSTON – Children’s Hospital Boston has unveiled plans to add 60 beds in a two-story, 136,000 square foot expansion that would take place on top of the current hospital, which is located in the Longwood Medical Area.

The expansion is needed to keep up with demand, as officials say the hospital operates at an average capacity of 84 percent and has, on occasion, had to send patients to other area hospitals. Officials say they have not come up with an estimated price tag for the project, which they hope to complete by 2011.

In addition to the two-story expansion, Children’s would like to embark on another expansion in about five years. That project could add 60 more beds in a 12-story patient tower that would replace an aging research lab slated for razing.

Children’s is also planning to add an 18-story research laboratory after receiving funding from the National Institutes of Health (NIH). And, it plans to add beds and space at its facilities outside of the city, at Children’s locations in Waltham and Peabody, as well as at the Lahey Clinic in Burlington and South Shore Hospital in Weymouth.

The acute-care expansion plans need to gain the approval of both the Boston Redevelopment Authority as well as the Massachusetts Department of Public Health.

Healthcare observers say the proposed projects come at a time when construction is booming at children’s hospitals throughout the country, in places such as Denver, Seattle, and Chicago.

According to the National Association of Children’s Hospitals and Related Institutions, a lobbying group based in Alexandria, Va., pediatric volumes are declining throughout the country. As a result, many community hospitals are dropping their pediatric services, which, in turn, is fueling the need for consolidations at large urban hospitals that provide such services.

Technology is key

driver of three future

Oklahoma hospitals
OKLAHOMA – In a tell-tale display of what technology means in the healthcare industry, three western Oklahoma cities are getting new hospitals despite declining populations. The hospitals, which are not adding new beds, are hoping to build larger patient rooms and add technology in order to keep area residents from traveling to Oklahoma City, more than 50 miles to the east, for healthcare services.

The hospitals are under construction in Elk City, Weatherford and Sayre, all three of which are located along U.S. Interstate 40 approaching the Texas border. The new hospitals, according to administrators, are expected to provide healthcare on a par to what’s available in big cities.

The future hospitals are the $55 millionGreat Plains Memorial Hospital in Elk City, the

$16.5 million Sayre Memorial Hospital, and a new $19.5 million replacement in Weatherford, which will have what administrators are calling a state-of-the-art women’s medical center.

Neighbors remain

opposed to expansion

plans in Sacramento

SACRAMENTO, Calif. – Even though Mercy General Hospital in Sacramento recently ended a dispute with a nearby Catholic school, the hospital’s expansion plan still faces tough opposition from neighbors in the eastern part of the city.

Mercy and its parent company, San Francisco-based Catholic Healthcare West (CHW), filed an application for a $150 million, 117,000 square foot expansion project two years ago. The largest aspect of the plan calls for a new $90 million heart center.

Since that time, hospital officials have run into plenty of organized opposition from neighborhood groups, including Sacred Heart Parish School, Neighborhood Groups Against Mercy Expansion (N-GAME), and others. In recent weeks, the health system announced that it had reached an agreement with Sacred Heart that would lead to the building of a new $15 million school.

Even so, at least three other neighborhood groups they still oppose the hospital’s plan. They say the plan constitutes an overbuilding on the Mercy property and has too much of an impact on local neighborhoods, including an increase in safety hazards, traffic and noise, among others.

Hospital officials say they plan to continue meeting with neighborhood groups to try and resolve the issues.

Lodi, Calif., hospital

gets bond backing

it needs to proceed
LODI, Calif. – It looks as if Lodi Memorial Hospital’s plans for a $180 million expansion and upgrade will proceed as planned, as a loan committee for the Office of Statewide Health Planning and Development (OSHPD) has agreed to back up to $150 million in hospital bonds for the project. A loan committee for CalMortgage, a division of OSHPD, voted 8-0 in recent weeks to insure Lodi Memorial’s bonds.

Work is scheduled to begin on the project, which would include the addition of a 90-bed wing, in 2007. Lodi officials say they plan to finance the project by borrowing $30 million in March or April to begin smaller projects, followed by issuing $120 million in debt beginning in 2008 to begin work on the new wing.
The hospital’s annual debt payments will amount to an estimated $9.4 million for 30 years, according to officials. Lodi Memorial had net income of $11.3 million in 2005 and has been operating in the black since 2000. The remaining $30 million needed for construction will likely come from fundraising and the hospital’s reserves, officials say.

State officials note that California’s A+ credit rating helps community hospitals obtain financing through Wall Street underwriters, who otherwise do not typically know the financial fundamentals of individual hospitals.

UI Med Center

still pushing for

$500 million plan
CHICAGO – The University of Illinois Medical Center at Chicago (UIC) is pressing forward with its plans for a $500 million expansion, even though the state-run hospital faces potential difficulties convincing state lawmakers to pay for a portion of the project.

As other competing Chicagoland hospitals and healthcare systems continue to pursue building projects at an unprecedented pace, UIC officials say their medical center needs to remain competitive. The first step in the development process entails asking state regulators, the Illinois Health Facilities Planning Board, for permission to spend $18 million on developing a master plan.

Eventually, UIC would like to renovate its current 433-bed hospital and construct a new 215-bed tower, mostly for intensive care patients. The university first proposed the project two years ago, when costs were estimated at $326 million. That figure has now risen to the neighborhood of $500 million.

One competitor moving forward with a huge building plan is nearby Rush University Medical Center, which has proposed an $810 million renovation.

Even with competition heating up, observers note that state-run UIC faces plenty of challenges in its quest. For example, the state’s budget picture is not exactly rosy as lawmakers grapple with ways to pay for needed improvements in education and mass transit, and to deal with underfunded pensions.
 
And even though UIC’s financial picture has recovered recently – it’s posted five straight years of profitability – it still lacks the financial wherewithal to pay for large portions of the project, as it made $5.8 million in fiscal year 2006 on revenues of $532 million.

Hospital in Butler, Pa.

plans new tower,

outpatient facilities
BUTLER, Pa. – Butler Memorial Hospital is planning a new $100 million inpatient tower as the focal point of a construction program that officials say will mark the system as a “healthcare system for the 21st century.”

In addition to the patient tower, Butler is planning three to five large outpatient facilities throughout the Butler region, which is located about 30 miles north of Pittsburgh. The outpatient centers will be similar to a facility the hospital recently opened in partnership with a group of physicians in Butler Township. That $10 million outpatient facility, called the Benbrook Medical Center, includes operating and procedure rooms for walk-in patients, doctors’ offices, exam rooms, and a cancer center.

Butler plans to begin site preparation for the new patient tower in spring 2007, with completion scheduled for 2009. Officials say they plan to finance the projects with cash savings, operating income and bonding.

The future inpatient tower is likely to be about six stories tall and contain a new emergency room, operating suite, ICU and an undetermined number of medical and surgical beds. All of the rooms would be private, according to hospital officials. A third element of the project calls for upgrading the system’s information-sharing technology, which would link patients, doctors and specialists at the hospital and the satellite facilities.

Indiana hospital

receives responses

to calls for partner 

VALPARAISO, Ind. – Hospital Seeking Partner in Indiana: 70-year-old, not-for-profit, county-owned hospital seeks partner to share in providing healthcare for patients in Valparaiso, a college town of about 30,000 people not too far from Chicago. Partner must be willing to commit $225 million toward the cost of a new $300 million replacement facility.

That might not be exactly how Porter Hospital in Valparaiso spread the word last summer that it was looking for a service-provider partner, but you get the idea.

And what was the response to Porter’s call for a potential partner, be it a for-profit or not-for-profit system or hospital? Since making its desires known in June, Porter has heard from 38 would-be partners. In recent weeks, the hospital had narrowed that list to a handful of finalists. It hopes to announce its choice in early 2007.

Making Porter a desirable partnership choice is the fact that the hospital enjoys a 60 percent market share in Valparaiso. In addition, the hospital has an option on 60 acres on which to build its future replacement facility. Hospital officials say they plan to ask for the public’s help in making the final decision, as the choice is likely to have an effect on what type of services are offered at the new replacement hospital. A task force also has been formed to help the hospital’s board make that final choice.

Lack of investors

kills plan for private,

Indiana hospital

JEFFERSONVILLE, Ind. – Citing a lack of interest from doctor/investors, an investment group in southern Indiana has dropped its plans for a private, 40-bed hospital in Jeffersonville, near Louisville, Ky. As a result, the group has put its 33-acre site along U.S. Interstate 265 on the sale block, according to local news reports.

The proposed Sunnyside Surgical Center had endured several delays since it was first proposed, including a county moratorium on private hospital construction. Eventually, a federal judge struck down the moratorium. Even so, as potential investors were hard to come by, the plan at one point was downsized from 40 beds to 18.

Finally, in early November, the lead investors on the project announced that they were scrapping the plans. A number of the doctors who had shown an interest in the project have since decided to invest their money elsewhere, including an outpatient surgery center planned for nearby in Floyd County, Ind.

For the Record

Union Hospital in Terre Haute, Ind., is planning several major construction projects, including a $178 million replacement hospital and a $15 million comprehensive cancer center. The new hospital building would have 350 beds in a six-story, 575,000 square foot facility. Officials plan to break ground in summer 2007 with completion scheduled for 2009. The Hux Cancer Center is slated for completion in January 2008… Alexian Brothers Hospital Network near Chicago recently started work on the largest portion of its overall $450 million expansion plan. After receiving the go ahead from the Illinois Health Facilities Planning Board in recent weeks, Alexian Brothers quickly started work on a $116 million, four-story tower at its Alexian Brothers Medical Center in Elk Grove, Ill. A goal of the project is to convert at least 95 percent of the hospital’s patient rooms to private, according to hospital officials… Vista Health System of Waukegan, Ill., recently announced plans to build a nearly $100 million, 140-bed acute-care hospital in Lindenhurst, Ill., another suburb north of Chicago. In addition, Vista said it is planning to develop an open-heart surgery program at Vista Medical Center East in Waukegan. The 140-bed Lindenhurst facility would be built near an existing Vista surgery center. Vista has submitted its plans to the Illinois Health Facilities Planning Board… Kaiser Permanente’s Roseville Medical Center in Roseville, Calif., recently broke ground on a $52 million, 32,000 square foot expansion of its emergency room. Hospital officials say the project’s design is cutting edge in that it will not include a typical emergency room waiting area. Instead, patients will be greeted by staff and taken directly into the emergency area. The plan calls for expanding the emergency area from 10,000 square feet to 42,000 square feet. Other projects at the Roseville hospital, which is located north of Sacramento, Calif., include a new 174-bed women’s and children’s center, as well as a 270,000 square foot MOB… Bedford County Medical Center in Shelbyville, Tenn., recently closed on the acquisition of land for its future $35 million, 60-bed replacement hospital.  A groundbreaking on the new facility is expected in spring 2007, with completion slated for later summer 2008. The future campus will include an MOB. The hospital was acquired from the county last year by Brentwood, Tenn.-based Community Health System. The county still owns the site of the current hospital and is considering options for that property… Northeast Georgia Medical Center and Health System in Gainesville, Ga., recently filed for Certificate of Need (CON) approval with the state for a $209 million, 100-bed replacement hospital. The facility would be located about 20 miles from the main campus in fast-growing Gainesville and would replace an existing 100-bed satellite hospital about a mile from the main campus. The not-for-profit system composes the 318-bed main hospital, the 100-bed satellite facility, and two long-term-care centers (LTACs)… Gwinnett Medical Center in Lawrenceville, Ga., just east of Atlanta, still needs state approval to move forward on a proposed $92 million patient tower that would add 129 beds. Officials at the not-for-profit hospital say the expansion received a boost in recent weeks when Gwinnett County commissioners approved the backing of $25 million in bonds to support the project. The expansion would bring Gwinnett’s bed total to 304… St. Bernard Parish, La., has condemned Chalmette Medical Center, paving the way for the demolition of the parish’s only hospital. The hospital has been shuttered since Hurricane Katrina inundated it with floodwaters back in late August 2005. Officials with the hospital, which is part of King of Prussia, Pa.-based Universal Health System Inc., have asked for a delay in order to remove medical records and medical waste. The 25-year-old Chalmette Medical Center was licensed for 265 beds. Healthcare in the parish is being provided by what officials call a patchwork of efforts, such as the federal government and a group of local doctors that brought in two health systems to provide services… St. Elizabeth Hospital in Gonzales, La., recently broke ground on a $14.5 million, two-phase expansion project. The first phase, slated for completion in late 2007, calls for expanding the emergency department from seven to 14 beds, privatizing all patient rooms, and expanding the cardiopulmonary department, labs and the pharmacy. The second phase would involve renovating much of the hospital’s interior. The architect on the project is Bradley-Blewster and Associates… A $198 million expansion project at Banner Thunderbird Medical Center in Glendale, Ariz., marked another step toward completion with the recent opening of a new 606-space parking garage. Hospital officials expect to break ground in spring 2007 on the major aspect of the project, a 200-bed patient tower, which is scheduled for completion in late 2008… Bon Secours St. Francis Hospital in Charleston, S.C., has started a $25 million, 63-bed expansion that’s on track for completion in spring 2008… Sierra View District Hospital in Porterville, Calif., has announced plans for an 118,000 square foot addition. The project would entail demolishing a portion of the original, 1957 hospital structure, renovating portions of that facility, and adding a new three-story tower. Included would be new imaging and laboratory facilities, an expanded emergency department, a new 16-bed critical care unit, and a 14-room labor-delivery-recovery and post-partum (LDRP) rooms. q