Hospital infrastructure boom hits throttle in 2017

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Dave Kenney, superintendent, GE Johnson Construction Company, tours the site of what will be Children’s Hospital Colorado, Colorado Springs.

The most common theme in 2017 among major health care providers in Colorado Springs was preparing for a rapidly growing community by adding significantly more infrastructure. Hundreds of millions of dollars were budgeted this year to ready Children’s Hospital Colorado, UCHealth Memorial and Penrose-St. Francis for the delivery of care in the near and distant future.

Children’s Hospital construction begins

It’s been about eight months since dirt began to move at the site of Children’s Hospital Colorado, Colorado Springs, which is leasing space on the campus of UCHealth’s Memorial Hospital North, between Briargate Parkway and North Union Boulevard.

“The most visible development for Children’s Hospital Colorado is, by far, the ground breaking for formal construction to start the facility,” said Children’s Hospital Colorado Regional Vice President Greg Raymond.

Expected to open to the public in spring 2019, GE Johnson Construction Company is building the 294,000-square-foot facility, which boasts a 31-exam-room emergency department with six behavioral health rooms, eight operating rooms, 34 private recovery rooms and six extended stay rooms. The facility will also have a Center for Cancer and Blood Disorders (combined inpatient and outpatient): eight private infusion rooms, four infusion bays and four exam rooms. It will feature 48 medical surgery and pediatric intensive care unit beds, 50 neonatal intensive care unit beds, a sleep center and 110 total inpatient beds.

“People will see the skeleton going up quickly in the first quarter of 2018, which will allow its scale to come to light,” Raymond said, adding the hospital has been actively recruiting doctors to fill general and specialist positions.

“The focus in 2017 was finalizing plans needed to open and operate the new hospital with recruitment, hiring and orientation taking place in the latter half of 2018 and the first half of 2019,” he said. The hospital is expected to open to the public in spring 2019.

But 2017 was not without its challenges.

“We received a July deluge of rain and, in that month, there were just a handful of dry days,” Raymond said. “There was the constant mitigation of water — pumping to ensure we had a site that would allow us to build both a literal and figurative base to our future.”

He explained the biggest change in plans in 2017 was building a neonatal intensive care expansion in what was originally delegated as shell space for future expansion.

“It became clear we needed to open with that capacity,” Raymond said.

According to updated data provided by Children’s Hospital Colorado, the project’s total economic impact during construction (2017-19) will be $240.5 million and employment of (direct and indirect) 1,400 workers and:

• The cost of the building itself is more than $160 million;

• Once completed, the new hospital is expected to create 1,100 jobs (indirect, induced and direct);

• The 700 direct jobs created by the new hospital are expected to produce $42 million in annual earnings for employees; and

• The annual economic impact of the hospital after completion is expected to be $147 million.

Penrose-St. Francis expands east campus, prepares for new one

One change for Penrose-St. Francis Health Services in 2017 was its board’s decision this summer to move former South State Operating Group President and CEO Margaret Sabin from oversight of the entire group, which included St. Mary-Corwin Medical Center in Pueblo and St. Thomas More Hospital in Cañon City, to overseeing development in Colorado Springs alone.

Thomas Gessel has taken over as group president. Sabin said Gessel does not have a seated CEO role in the hospitals, and the role is “very corporate.”

“There are CEOs and boards at each hospital,” Sabin said, adding the move means she has more time to spend in the Pikes Peak region. She said her role has changed only slightly.

“Of the [South State Operating Group], Penrose-St. Francis is almost 90 percent [of operations],” she said. “We’re the biggest hospital in Centura. It just means I don’t have to go to meetings in Cañon City and Pueblo as often.”

Sabin will direct her focus on further expansion of Penrose-St. Francis’s presence in Colorado Springs, to include the construction of its new campus at Fillmore and Centennial boulevards.

Mark Hartman, chief administrative officer of St. Francis Medical Center, is currently seeing the bulk of construction on his campus.

After breaking ground in May, the system embarked on a 23-month project following a nine-month delay due to funding issues from its financier, Catholic Health Initiatives.

“We flirted with being ahead of schedule and I just walked [the site] and we’re right on schedule now,” Hartman said.

On target for a 2019 grand opening, the $102 million expansion is also on budget, Hartman said.

“One thing we did change … we originally planned to build out two operating rooms with shelled space for a total of nine,” Hartman said. “We are now building out four because we need it.”

The project also includes growing the emergency department and significantly increasing the capacity of the neonatal intensive care unit as well as creating additional parking. Construction will add about 134,000 square feet of space via a four-level addition.

Lonnie Cramer, chief administrative officer with Penrose Hospital, offered an update on the new campus project, which has not begun construction at Fillmore and Centennial boulevards. Centura initially acquired 51 acres and went through the planned unit development rezoning process for that space, which included plans for two medical office buildings and a hospital on a total of 770,000 square feet.

This year, the system acquired a nearby asphalt plant from Martin Marietta Materials Inc., adding 29 acres to the campus’s potential footprint. Following objections from nearby residents regarding its scope, Cramer said Penrose became more involved with the neighborhoods and eventually modified plans, to include its initial 200-foot height limit.

“We thought maybe we can do this better,” Cramer said of the process. “We wanted to hear from the community and we used [the Council of Neighbors and Organizations] to help bring 19 [homeowner associations] in. It was clear to us they wanted more input and involvement. We created the Mesa Committee, much like the one in the Old North End. We meet at least quarterly to discuss just this campus.”

The PUD has since been revised to incorporate all 80 acres with a height limit of 165 feet. The footprint has increased to a more spread out 1.5 million square feet, Cramer said.

“We don’t think we’ll build that big, but it allows us … to expand in the future as the community needs,” he said.

Cramer said dirt removal and mitigation may start in January or February, but construction isn’t likely to begin for another 18 to 24 months.

“It would be unrealistic to do it any faster,” Cramer said. “We’re looking at the latter half of 2019, at the earliest.”

Also related to Penrose-St. Francis was the signing of a merger agreement late this year between Dignity Health and Catholic Health Initiatives. CHI jointly operates Centura Health with Adventist Health System. Centura is the state’s largest hospital group and is the parent organization of Penrose-St. Francis. The merger will create a new nonprofit Catholic health group based in Chicago. The deal is expected to close sometime in late 2018 pending a series of approvals.

Memorial completes year with new CEO

While Memorial Hospital dealt with many of the same growing pains as other health care providers in the city, it faced those challenges with a new CEO.

Joel Yuhas previously served as president and CEO of St. Mary Medical Center in Long Beach, Calif., part of Dignity Health, before taking over Memorial in January.

“The first year has gone by like that,” Yuhas said, with a snap of his fingers. “It’s been a busy, crazy year of phenomenal growth here.”

Yuhas oversees Memorial Central, Memorial North and Grandview hospitals, five urgent care centers and four free-standing emergency departments. The system saw about 260,000 people this year.

“When I first got here, I was amazed to see such an incredibly busy emergency department,” he said. “We hired a group to do a physician gap study to see what the primary care landscape looks like here and where deficits are in specialty care.

“I very quickly started to understand why we have such a busy emergency department and urgent care network. It’s the deficit of primary care. There’s a nationwide shortage of primary care physicians, but in this market, it’s even worse than the national average.”

Yuhas said one goal in 2017 has been to recruit more primary care physicians to meet the 170-doctor shortage in El Paso County alone.

“Via the UCHealth Medical Group we continue to employ primary care physicians. That’s a reactive strategy. A proactive strategy this year is building relationships between us and [Pikes Peak Community College] and UCCS. UCCS specifically because it is a platform for us to build our primary care long-term strategy with the CU School of Medicine.

“In a proactive way we have expanded clinical training programs here. We have three residency programs at Memorial,” he said. “… Those are vehicles for us to train and then recruit back to this city primary care and specialty physicians as well.”

Yuhas pointed to Memorial’s continued relationship with Children’s Hospital Colorado. Memorial is leasing a portion of its north campus for the new Children’s facility and the two structures will be connected.

“We’re excited about the new [Children’s Hospital] opening up in April 2019 on same campus as Memorial North,” he said. “We work very closely with them. Jena Hausmann is their CEO and she is on our board.”

Not to be left out, UCHealth Memorial is also making major investments in infrastructure. In April, the system announced it would grow the original scope of its north campus expansion, increasing its budget from $85 million to nearly $130 million and growing the hospital’s capacity to more than 110 inpatient beds.

The project will be phased so that the operating rooms and additional emergency department bays should open in fall 2018 and the oncology and a “mom/baby tower” will open in spring 2019.

Also in 2017, Memorial acquired Texas-based Adeptus Health’s share of several co-owned operations which included Grandview Hospital in Colorado Springs and four freestanding ERs in El Paso County.

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