Mercy unveils big plans in Baltimore
$400 MILLION TOWER WILL ADD 672,000 SQUARE FEET TO HOSPITAL’S PRESENCE
By John Mugford
BALTIMORE – Mercy Medical Center in Baltimore recently announced plans to build what it is calling a state-of-the-art, $400 million patient tower in the heart of the downtown.
The hospital, which is part of Mercy Health Services and the Sisters of Mercy, has received a Certificate of Need (CON) from the state of Maryland. Mercy plans to break ground on the 18-story tower, 672,000 square foot tower in spring 2008, with completion slated for fall 2010. Mercy, which is a 133-year-old hospital, currently has 1.2 million square feet of space in Baltimore.
Construction is scheduled to occur in several phases; the first phase will entail relocating services such as maternal child health and radiology and adding space for growth. The cost of the first phase is estimated at $292 million. Future phases would entail finishing and outfitting all of the floors at a cost of more than $100 million.
In addition to the new tower, Mercy has started construction on a 1,300-space, stand-alone parking facility that will be connected to the new tower. It is slated for completion in August 2007.
Mercy officials say funding for the project will come from a variety of sources, including net income from hospital operations, bonds, and a capital campaign with a goal of $40 million or more.
The architect on the project is Minneapolis-based Ellerbe Becket, which is providing both exterior and interior deign services as well as engineering, equipment planning and construction administration services.
The construction contractor on the project is Baltimore-based Whiting-Turner Contracting Co. Other consultants include Richmond, Va,.-based Whitman, Requardt and Associates LLP as civil engineers, and Baltimore-based Mahan Rykiel Associates as the landscape design firm.
Houston is mecca
HOUSTON – Physicians in Houston are jumping headlong into the ownership of general acute-care hospitals, according to Nashville-based HealthLeaders-InterStudy, which provides information and research on the managed care industry.
In its recently released Houston Market Overview, HealthLeaders indicates that the area’s physicians are probably investing in acute-care hospitals because of the restrictions that have been placed on smaller, specialty hospitals.
“Houston far outpaces other cities in the boldness of its physicians, both in the sheer number of facilities owned and their willingness to branch out from operating small, niche facilities into operating larger general, acute- care hospitals,” stated Renee Burnham, a HealthLeaders-InterStudy market analyst and author of the report, in a prepared statement.
In recent years, physicians – in a partnership with Charlotte, N.C.-based Hospital Partners of America Inc., have acquired two acute-care hospitals: Twelve Oaks Medical Center and St. Joseph Medical Center (formerly Christus St. Joseph). In addition to those acquisitions, a new Houston-based company called University General Hospital Systems (UGHS) signed a $1 billion agreement in late 2006 to develop 10 physician-owned hospitals in partnership with Charlotte, N.C.-based Alliance Development Group in November 2006.
The partnership has developed one hospital to date: $50 million University General, which opened in Houston in September 2006. The next development venture is to be a $40 million, 80-bed hospital in the Chinatown section of Houston.
Also, physicians in Houston developed Town & Country Hospital, which failed about a year after its opening.
Folks get a peek
at $1B UCLA
LOS ANGELES – There was plenty of fanfare for the dedication of the long-awaited Ronald Reagan UCLA Medical Center in late June in Los Angeles. While the opening of the $1 billion medical center is still a year or so away, hundreds of doctors, nurses, patrons and public officials were on hand to get a look at the facility designed by world-renowned architect I.M. Pei and his son, C.C. Pei. The Peis were joined in providing design services by Perkins & Will and RBB Architects
The 520-bed hospital was initially scheduled to open in late 2004, but cost overruns and construction delays put the massive project more than four years behind schedule. These days, UCLA officials are no longer providing a precise, estimated opening date for the hospital, which is still empty. They are, however, saying the hospital should open for business sometime between March and June of 2008.
When the project was first planned in 1998 – after UCLA Medical Center was damaged by the Northridge Earthquake in 1994 – the total cost was pegged at just under $600 million and the completion date was set for 2004. The 1 million square foot replacement hospital, by the way, sits across the street from the damaged facility.
UCLA officials have said time and time again that the delays were caused by the rising costs of construction materials, including steel, drywall and other materials. Also, the design of the facility was altered along the way to incorporate the latest in technological advances.
The hospitals design reportedly creates the illusion of several smaller hospitals instead of one. Officials say the hospital structure is made up of four towers, three of which house the large, private patient rooms with Internet access and nursing pods. The new medical center is the largest construction project in the history of the University of California.
foregoing Fed funds
for new Charity
BATON ROUGE, La. – Politics are heating up in Louisiana as Gov. Kathleen Blanco tries to secure funding for a new Charity Hospital in downtown New Orleans. It now looks as if the governor is willing to turn down federal money in order to build the $1.2 billion hospital that would replace a Charity facility that has been closed since suffering damage during Hurricane Katrina in the fall of 2005.
Ms. Blanco is not running for reelection and Louisiana political observers have said in news reports that she must act fast or the project could be scaled back when a new governor takes office in January. The governor has noted in public statements that she might be willing to forego about $300 million in federal recovery block grant money because the process is being bogged down by red tape.
As a result, Ms. Blanco stated that Louisiana needs to self-fund its portion of the proposed 484-bed hospital project, which includes buying land and hiring an architect for the design work.
Charity Hospital provides plenty of healthcare to uninsured patients, but officials with LSU Health Services, which operates the hospital, have said that the new hospital would attract enough paying patients to pay off much of the construction cost once the facility opens – which is slated for 2012. Some opponents to the plan question LSU’s assertion.
U.S. Senator David Vitter (R-La.) recently asked the U.S. Housing and Urban Development Dept. to delay approving most of the federal block grant money until Louisiana officials considered options for restructuring the state’s plan to deal with uninsured patients. HUD then sent Gov. Blanco a questionnaire concerning the hospital plan.
LSU, VA campus
in New Orleans
could be 70 acres
NEW ORLEANS – Louisiana State University announced this month that the downtown New Orleans medical campus it plans to share with the U.S. Department of Veterans Affairs (VA) could be as large as 70 acres.
If that is the case, the campus could consume a neighborhood that includes empty buildings, weedy parking lots and a patchwork of viable and neglected homes – part of the ruin wrought by Hurricane Katrina in 2005.
The state of Louisiana is preparing to spend tens of millions to buy the land needed for the projects. In some cases, the state is prepared to use its power of eminent domain.
LSU’s new hospital would be a replacement for the shuttered, 20-story Charity Hospital, a teaching facility that sits on a prime piece of real estate a few blocks from the proposed site of the future LSA-VA facility.
LSU officials recently said in news reports that they have no immediate plans for the idle Charity facility, an art deco icon in the heart of the city. Activist groups in the city have called for the building’s preservation, some even saying it should remain as a hospital.
Donald Smithburg, who leads LSU’s hospital division, told a local newspaper that the state has ruled out the tearing down of Charity to make way for a new teaching hospital.
For one thing, the property on which charity sits is only 11 acres – much too small to accommodate a new teaching hospital, according to Smithburg. He notes that several developers have inquired into converting the former hospital into residential units.
A team of consultants led by Rome, Ga.-based Adams Management Services Corp. reports that it would cost as much as $258 million to repair Charity and $395 million to replace it with a new hospital. The consultants have recommended mothballing the Charity building.
looks to build in
Santa Clarita, Calif.
SANTA CLARITA, Calif. – Hospital wars are heating up in the growing city of Santa Clarita, Calif., located about 25 miles north of Los Angeles. Just as city officials are debating the size and scope of expansion plans submitted by Henry Mayo Newhall Memorial Hospital, another provider has indicated that it plans to pursue the building of a new hospital in the city.
Mission Hills, Calif.-based Providence Health & Services, which operates two hospitals in the greater Los Angeles area, recently informed Santa Clarita officials that it plans to acquire up to 35 acres to build a hospital in the city.
City officials have indicated that even with the expansion being planned by Henry Mayo Newhall, the city is likely to need an additional 150 to 200 beds and a new emergency room to serve Santa Clarita, which is growing 9 percent annually.
It is likely that the future Providence hospital would take about eight years to be completed, according to city officials.
In a letter sent to the city, Providence officials wrote: “Henry Mayo Newhall Memorial Hospital’s current expansion plan will only continue to supply hospital beds for approximately 40 percent of the community – continuing to force six out of 10 Santa Clarita residents to other areas for care. In these cases, Providence Holy Cross Medical Center in Mission Hills is their first choice for quality health care services.”
Providence officials say that 16 percent of the inpatients at its Mission Hills hospital travel from Santa Clarita – even more for specialty services, such as advanced radiation oncology, high-risk obstetrics and neonatal care. Twenty-five percent of patients who seek out the Mission Hills facility for cardiac care and surgery are from Santa Clarita, according to the letter.
In their letter, Providence officials touched on a major point of contention in the proposed plan submitted by Henry Mayo Newhall – the amount of MOB space being built in the city. A group of Santa Clarita activists say too much healthcare space is being built in MOBs. About 150,000 square feet of MOB space has been built in the last year or is under construction in Santa Clarita, and Henry Mayo’s plan calls for adding another 200,000 square feet. The hospital’s plan calls for adding about 135,000 square feet of inpatient space.
Providence, which operates an outpatient facility in Santa Clarita called Providence Holy Cross Health Center, says its first priority in building the new hospital is to add new beds, not office space.
looks to go private
because of ruling
POCATELLO, Idaho – Portneuf Medical Center in Boise, Idaho, recently set off a fierce debate when its board of governors announced that the Bannock County-owned hospital might need to become a private entity.
Portneuf says the need to go private was instigated by a decision of the Idaho Supreme Court in April 2006. In that decision – in the case of Frazier vs. the City of Boise – the court ruled that cities and counties cannot issue bonds to buy equipment or build infrastructure or buildings without the approval of two-thirds of local voters unless it involves an emergency.
At the time of the decision, Portneuf was in the middle of a $200 million construction project to consolidate its two campuses. The decision applies to Portneuf because it has taxing authority, even though the county-owned hospital has not levied taxes since the 1970s. Portneuf officials plan to use revenues generated by hospital operations to pay back all bonds it uses to finance construction.
At least three private companies, including for-profit, Franklin, Tenn.-based Capella Healthcare, have stepped forward with offers to acquire or lease Portneuf.
According to local news reports, numerous local doctors and residents of the community didn’t like the idea of the hospital becoming a for-profit entity and wrote numerous letters to the editor of the local newspaper, the Idaho State Journal.
The hospital’s Board of Governors recommended that the hospital convert itself into a 501(c)3 nonprofit, like Saint Alphonsus and St. Luke’s hospitals in Boise, Idaho. Bannock County’s commissioners are expected to make a final decision about any changes to Portneuf’s structure or ownership in coming weeks. The Idaho Hospital Associations says other state hospitals might need to consider converting to for-profit or not-for-profit status as well.
HCA opens new
257-bed hospital in
INDEPENDENCE, Mo. – After 30 months of construction, the $250 million, 257-bed Centerpoint Medical Center opened in May in Independence, Mo. The 420,000 square foot hospital, which is part of Nashville, Tenn.-based HCA Inc., replaces two local hospitals: Independence Regional Health Center and Medical Center of Independence.
The two hospitals were acquired by HCA four years as part of the system’s $1.13 billion acquisition of the 12-hospital system, Midwest Health. The new Centerpoint hospital is part of HCA Midwest Health System.
The new hospital is certified as a Level II trauma center and offers such services as cardiac catheterization and open-heart surgery.
On the Centerpointe campus is a 200,000 square foot MOB that includes an outpatient rehabilitation center and the Centerpointe Ambulatory Surgery Center, a joint venture of physicians and Medical Care America, HCA’s ambulatory surgery division.
Facility for military
personnel opens in
San Antonio, Texas
SAN ANTONIO, Texas – Military personnel returning from Iraq and Afghanistan with severe injuries now have a new place in which to rehabilitate.
The $50 million Center for Intrepid – National Armed Forces Physical Rehabilitation Center, a four-story, 60,000 square foot facility, has opened in the Brooke Army Medical Center in San Antonio.
The project was funded by donations to the New York-based Intrepid Fallen Heroes Fund and the Fisher Foundation. It includes clinical space, labs, a computer-assisted rehabilitation environment, gait lab, natatorium, athletic facilities and a prosthetic manufacturing facility. The construction manager was Parsippany, N.J.-based Skanska USA Building Inc. and the designer was the SmithGroup.
in Colorado plans
$225 million tower
WHEAT RIDGE, Colo. – Denver-based Exempla Healthcare recently announced plans for a new five-story, $225 million tower on the campus of Lutheran Medical Center in Wheat Ridge, Colo. The project includes razing a portion of the existing hospital, part of which was built in 1923.
The renovation does not include adding more beds – the hospital is licensed for 400. but it would privatize all patient rooms and make them larger. The new tower, which is part of an ongoing five-year capital plan, would have 200,000 square feet of space and 10 new operating rooms, a new obstetrics delivery unit and neonatal intensive-care unit.
Lutheran Medical Center needs to gain the approval of the Wheat Ridge City Council before moving forward. Exempla officials hope to begin demolition of the old portions of the hospital by early 2008 and complete the project by 2010.
For the Record
Plans for Indiana’s first stand-alone emergency room recently suffered a delay, when town planners in Fishers, Ind., asked for revisions to the proposed building’s exterior. The proposed St. Vincent Medical Center Northeast would be a 120,000 square foot facility with an emergency room with X-ray, surgery rooms and other medical services. The facility would be located just off U.S. Interstate 69 northeast of Indianapolis. The St. Vincent system and the developer, Indianapolis-based BremnerDuke Healthcare Real Estate, hope to start construction this summer and have the facility completed by September 2008. The building is proposed for a 26.6-acre parcel in the sprawling Saxony mixed-use development on the border of Fishers and Noblesville. St. Vincent plans to add a new hospital and MOB at the site within seven years… Construction was set to begin in mid-July on a replacement facility for Children’s Hospital of Illinois in Peoria. Currently, the 127-bed Children’s Hospital is part of OSF Saint Francis Medical Center in downtown Peoria. The new $234 million facility will be built adjacent to the existing hospital and will have eight stories tall and about 440,000 square feet. Construction is expected to be completed in 2010… Memorial Regional Hospital in Hollywood, Fla., scored a major win in late June when city commissioners granted the hospital a zoning change that could allow it to expand its 20-acre campus. Neighbors have fought the proposal, saying it cuts too deeply into residential areas. If the project is approved during a second hearing next month, Memorial will be allowed to build a new four-story home for its Joe DiMaggio Children’s Hospital, a cancer treatment center and a parking garage. The expansion would take place on a 5-acre site immediately east of the existing hospital that had been zoned for residential uses. The project is part of an overall 15-year construction program… Sisters of Charity of Leavenworth (Kan.) Health System recently announced plans for a $65 million addition to Saint John Hospital in Leavenworth. The expansion will increase the hospital’s inpatient capacity by about 50 percent and privatize all patient rooms. Completion is scheduled for 2010… Arrowhead Regional Medical Center in Colton, Calif., is set to begin an expansion that would add 84 new beds and an $18 million, 60,000 square foot administrative office building. Construction on the office building, which could also house some doctors and outpatient services, is slated to start by October. The new inpatient beds would be added to the hospital’s sixth floor, which would be renovated at a cost of about $30 million. The sixth floor has been home to administrative offices, which will be moved to the new building… Gilbert (Ariz.) Hospital in suburban Phoenix broke ground on an expansion that will add 16 patient rooms and nearly 8,200 square feet of space to the existing hospital. Construction is scheduled for completion in the late 2007. Upon completion, Gilbert Hospital will have a total of 24 inpatient beds, 24 emergency rooms and a total of about 40,000 square feet. A four-story patient tower with an additional 108 beds for Gilbert Hospital is slated to begin construction late this year. The architect for the latest expansion project is Phoenix-based HKS/The Stein-Cox Group. A general contractor had yet to be chosen at press time… Griffin Hospital in Derby, Conn., recently broke ground on a 49,000 square foot, $33 million ambulatory care pavilion and community cancer center. The new facility is being built on a 4-acre site across the street from the hospital’s main campus. The project is slated to open in October 2008. After completion, Griffin plans to move its physical therapy center, cardiac rehabilitation center and special procedures into the building. The move will allow the hospital to expand its emergency department from 8,600 square feet to 12,000 square feet; create a new, 14-bed medical-surgical or telemetry unit on the East Wing; expand its existing surgical suite and radiology department; and relocate its lab… The Waukesha (Wis.) Plan Commission approved preliminary architectural plans for the proposed $13 million Rehabilitation Hospital of Wisconsin. The project would be a joint venture of Waukesha-based ProHealth Care, which owns two local hospitals, and St. Louis-based Centerre Healthcare Corp. The facility would have 40 beds and 55,000 square feet of space. Appleton, Wis.-based Oscar J. Boldt Construction is the general contractor. The project is the third healthcare facility approved in growing Waukesha, west of Milwaukee, in the past year. The other projects are the 60-bed LifeCare Hospital for complex acute-care patients and the Midwest Kidney Care dialysis center, which was approved in early May… The Health Care District of Palm Beach County, Fla., has decided to commit another $10 million to build a new $73.4 million, 70-bed replacement facility for Glades General Hospital in Belle Glade, Fla. The health district is now planning to spend $50 million to build the replacement for the 63-year-old, 73-bed hospital. District officials had hoped to have another $12 million available for the project – money left over from the 2001 sale of Good Samaritan and St. Mary’s medical centers in West Palm Beach, Fla., to Tenet Healthcare Corp. (NYSE: THC) But Pennsylvania-based Catholic Health East, which formerly owned the two hospitals, has not released the money. Columbus Regional Hospital in Columbus, Ind., recently announced that it would like to add 120 new private patient rooms and a new emergency department in a $101 million, five-story pavilion. The plan is expected to go before the hospital’s board of directors in spring 2008, with construction taking up to three years. A less-expensive option under consideration is to build the five-story tower, leaving the top two floors unfinished. That proposal would cost $89 million and would initially add 62 new rooms and the emergency department. q
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