Physicians' efforts to revive a shuttered osteopathic hospital north of St. Louis will fail soon without a dose of capital, they report.
A group of 29 physicians last year put down $300,000 of the $1 million purchase price for the former Deaconess Health System North campus in suburban Normandy, Mo. They hoped to open it this year as Normandy Hospital, an echo of its first incarnation (March 21, p. 32).
Seven months later, they haven't found investors to take over the mortgage or finance the facility's rebirth as a 100-bed, for-profit hospital. Faced with a $20,000 mortgage payment due Aug. 1, they're considering selling the facility for some other use, said Michael Spezia, D.O., a former hospital board member who's leading the group.
The physicians also are negotiating for an extension on the mortgage and talking to state officials about the possibility of public funding.
"I know our guys have bent over backwards to make this work," Dr. Spezia said. "If there's an entrepreneur out there with $1 million, he could have a hospital. We just haven't found anybody who wants to do that.
"There's an attitude out there that St. Louis is 40% overbedded, but they don't understand that those beds aren't where they need to be," Dr. Spezia added.
The hospital-first as Normandy Osteopathic, then as Metropolitan Medical Center and finally as Deaconess-served Normandy and surrounding communities for nearly 50 years before its closure last April due to financial troubles (Feb. 15, 1993, p. 18). About 50,000 people live in its service area.
Residents now must travel many miles for emergency and other hospital services, said Normandy Mayor Elizabeth Houlihan.
Many physicians who helped buy the hospital trained as osteopaths there and have offices in those communities. "It certainly was a disappointment to see that hospital close," said Glenn Sherrod, D.O., a physician in the group. "Those of us who practice here know the need is real."
The physicians' dream drew support from local politicians, who pledged to lobby state officials for approval of the certificate-of-need application. The application, however, can't be filed without a financial plan, Dr. Spezia said.
Meanwhile, the University of Missouri-St. Louis, which eyed the facility as a possible student residence, backed out of bidding for it to please the community. It now may be a potential buyer again.
Although representatives of at least three healthcare providers visited the site and sat down for talks, none came through with an investment, said David Spewak, the physicians' attorney. "It certainly is an admirable goal," he said.
Consolidation and the shifting healthcare marketplace have made it a tough deal to sell, he said.
In addition to the purchase price, investors also would face about $4 million in costs to renovate the facility and start up operations, Dr. Spezia said.