With more than $90 million in the bank to pay for construction, an Iowa hospital plans to build a replacement facility.
Burlington (Iowa) Medical Center, a stand-alone not-for-profit hospital in the southeast part of the state, has ruled out a renovation of its 388-bed downtown campus in favor of a new inpatient facility four miles away in West Burlington. The new hospital will be half the size of the existing facility, although details of financing and designs have yet to be completed.
"Our present facility is landlocked on three sides, and we can't add any more ports for outpatient care," said Craig Borchard, director of public relations for the hospital. "We also need to downsize for our future acute-care-bed needs."
Hospital executives aren't ready to divulge the cost of the new project. They will disclose details before applying for a certificate of need from the Iowa Department of Health. The application is expected by year-end.
"It's a matter of having a facility that's going to last for another 100 years," Borchard said.
When the hospital and its related foundation had $90 million on hand two years ago, New York-based Moody's Investors Service upgraded the hospital's rating from A to A1, saying it had "an unusually strong cash position for a facility its size." The hospital continues to enjoy a strong cash position, although officials declined to specify the current balance.
Burlington Medical Center had net income of $4.2 million on net revenues of $57 million last year, according to HCIA, a Baltimore-based healthcare information company. It had 6,300 admissions from southeast Iowa, western Illinois and northeast Missouri.
The replacement project has been controversial because Burlington residents, particularly downtown business leaders, don't want to lose the hospital, which employs 1,200 at the downtown campus.
However, the hospital's board has directed the Columbus, Ohio, architectural and planning firm NBBJ to come up with alternative uses for the existing facility. Since 1989, when it purchased 82 acres in West Burlington, the hospital has built a cancer center, a rehabilitation facility and a family practice center at its Healthwest Campus.
Board Chairman Robert Fleming said the hospital is "committed to finding a new use for the downtown facility."