PHOENIX-Healthcare development in the desert west of Phoenix lags well behind that of the more prestigious East Valley communities such as Scottsdale, Tempe and Mesa. But a change may be on the horizon.
An influx of retirees and younger families is now fueling rapid growth, driving the area's few healthcare providers into ambitious expansion plans, officials say.
The West Valley suburbs, about 20 miles west of Phoenix, have a combined population of about 30,000 and are mostly composed of master-planned communities such as Litchfield Park, Goodyear and Avondale. The region is projected to reach a population of about 100,000 by 2010, according to the Phoenix Business Journal. In contrast, Phoenix and the East Valley cities have a combined population of more than 1.5 million.
Sun City-based Sun Health Corp. has embarked on a $50 million expansion of its 181-bed Del E. Webb Memorial Hospital in the Northwest Valley. Twenty-seven beds are being added over the summer, with an additional 90 beds scheduled to go on line by 2006. Sun Health has also added medical office space and assisted-living facilities in several West Valley locations.
"There's been a very nice growth in population with a variety of healthcare needs," said Lee Peterson, Sun Health's chief executive officer and president.
Along with Sun Health, Phoenix-based PMH Health Resources recently entered an agreement to provide healthcare services for the Estrella Mountain Ranch master-planned development. Located in Goodyear, 20 miles west of Phoenix, the community is to be built out over the next decade and could eventually be home to more than 100,000 people.
PMH, which operates 183-bed Phoenix Memorial Hospital in downtown Phoenix, will begin small, with the first step in a multiphased project to be a medical office building staffed mostly with family practitioners. But as the population grows, PMH plans to build an acute-care hospital in the community, probably within the next decade.
PMH has the blessing of Estrella Mountain's planners: The developer of the community, Paradise Valley-based SunChase Holdings, donated 20 acres on which PMH can build. SunChase President and CEO William Pope sits on the PMH board.
"Arizona is a community of master-planned communities, and strategic research has to be concentrated on predicting population flow and envisioning new communities," said Reginald Ballantyne III, PMH's CEO. "We want to be pioneers."
The Estrella Mountain Ranch deal is the second deal PMH has negotiated in the West Valley in recent years. Earlier in the decade it began building a 600,000-square-foot health facility on a 36-acre site in another nearby master-planned community, 10,000-acre Palm Valley.
It completed a 30,000-square-foot medical plaza in Palm Valley in 1996 and is expected to complete a 60,000-square-foot outpatient center later this year.
Des Moines, Iowa-based Five-Star Care Corp. is also building skilled-nursing and assisted-living facilities on-site.
Phoenix-based Samaritan Health System is adding an operating room and expanding and refurbishing existing facilities at its Thunderbird Samaritan Medical Center northwest of Phoenix. It's financing that work in part through the sale earlier this year of another West Valley hospital, Maryvale Samaritan Medical Center. The buyer, the fledgling Vanguard Healthcare Corp. hospital chain in Nashville, also has designs on regional expansion.
"We're taking a look at all of the Phoenix market, but we will be springboarding future development on the acquisition from Samaritan," said Vanguard spokeswoman Beth Brisbane.
Despite the growth spurt, assessments of West Valley's prospects have been mixed. For decades the area was neglected. Development centered on the East Valley, which is closer to Sky Harbor airport and the major arteries to Tucson, as well as home to most of Phoenix's businesses and white-collar professionals.
It also didn't help much that infamous financier Charles Keating was the biggest champion of West Valley development in the 1980s. Keating served time in federal prison earlier in the decade after being convicted of fraud in connection with the Lincoln Savings and Loan scandal, although his convictions have since been overturned on appeal. John Milligan, a partner in the Phoenix law firm Gallagher & Kennedy and head of its healthcare practice, remains skeptical that healthcare providers will flock to the valley. But he conceded that heavy traffic from the east makes downtown access far easier from the west.
"There are contrarians," he added.
One of them is John Rivers, president of the Arizona Hospital and Healthcare Association, a hospital trade group.
"The West Valley is growing at a tremendous rate, and opportunity is knocking there for those willing to pay attention to it," he said.
Ballantyne said he is certain others will.
"The East Valley is becoming crowded and expensive, and there is already an excess of inpatient facilities," he said. "The frontier is now the western portion of Phoenix."