University of Michigan to build $920 million hospital it calls 'most advanced' in Michigan

A new $920 million, 264-bed hospital for the University of Michigan is expected to open in the fall of 2024 after a vote today by the university's board of regents approving the project.

Michigan Medicine officials said the new 12-story adult hospital will "transform inpatient and surgical care," create 370 construction jobs, employ 1,900 full-time medical workers and alleviate overcrowding on the main medical campus in Ann Arbor.

Regent Ron Weiser said the new hospital will be the "most advanced such facility in Michigan."

The new clinical inpatient tower, which will span 690,000 square feet, will be at Ann Street and Zina Pitcher, west of UM's 550-bed University Hospital, an 11-story facility that opened in 1986, and the Frankel Cardiovascular Center.

"We are proud to be at the forefront of innovation with a new hospital that will support the extraordinary work of our faculty, nurses and other providers and our research community," Marschall Runge, M.D., CEO of Michigan Medicine and dean of the university's medical school, said in a statement. "It's an investment in Michigan Medicine's mission of advancing health to serve Michigan and the world."

Officials said the new hospital will specialize in neurological, neurosurgical, cardiovascular and thoracic care. UM had approved studying the feasibility of a new hospital twice in 2018.

David Spahlinger, president of the University of Michigan Health System, said the new hospital will allow 110 beds in semi-private rooms to be relocated from University Hospital, freeing up space and allowing all inpatient beds to be in private rooms.

The building project will add a total of 154 beds and create 23 procedural suites for surgical and interventional radiology on the medical campus.

The project also contemplates additional parking, which nurses and employees have complained is in short supply, along with transportation and roadway improvements.

Michigan Medicine also plans to achieve LEED Gold status for the building to reduce its carbon footprint and exceed state standards by 20 percent. LEED provides a framework to create healthy, highly-efficient and cost-saving "green" facilities.

Some features of the new hospital include the following:

• Additional "family spaces" that will allow relatives to visit patients in rooms with more convenience.
• Centralized "collaboration spaces" in each patient area to enhance continuity of care.
• Two floors that will have 20 operating rooms built with the latest technology. The new ORs will be larger than current hospital ORs and allow for three cutting-edge interventional radiology suites
• Patient rooms that allow for more complex care, including capability for all spaces to support intensive care.

"This hospital will not only help us meet our community's future health care needs, it will be a greater resource for other hospitals across the state, and further support and enable UM health care providers to do their very best work," said University of Michigan Regent Shauna Ryder Diggs, M.D., in a statement.

Over the past decade, Michigan Medicine, the clinical arm of the University of Michigan in Ann Arbor, has expanded its base of three hospitals to encompass medical affiliations or ownership stakes in Midland, Grand Rapids, Chelsea, Lansing and partnered with other hospitals.

Besides hospitals wanting the Michigan brand, Spahlinger has told Crain's UM has needed more beds and space because its three main hospitals are nearly full with occupancy rates regularly above 90 percent. Its three main hospitals in Ann Arbor are University Hospital, Mott Children's and Von Voigtlander Women's Hospital.

Overall, Michigan Medicine owns or is affiliated with 15 hospitals in Ann Arbor, Midland, Chelsea, Wyoming and Lansing. It also operates 40 outpatient locations and home care operations that handle more than 2.1 million outpatient visits a year.

In early April, UM signed a master affiliation agreement with Sparrow Health in which the university made a 50 percent financial investment in Sparrow's pediatric program and a minority investment into Sparrow's profitable health plan.

The Sparrow pediatric services joint venture will integrate UM's pediatric services at C.S. Mott Children's Hospital with Sparrow Children's Center in Lansing. The minority investment in profitable Physicians Health Plan will most likely begin with UM's employees and could expand from there depending how successful the plan is at reducing the university's health care costs.

In 2018, UMHS signed a master affiliation agreement with 14-hospital Trinity Health Michigan and acquired a 49 percent interest in its Chelsea Community Hospital.

In 2013, UM Health System signed a master affiliation agreement and a minority investment of up to 20 percent with the four-hospital MidMichigan Health in Midland. The partnership includes working together on oncology, heart and vascular, telemedicine, neurology, obstetrics and other subspecialties.

UMHS also has a longstanding relationship with the VA Ann Arbor Healthcare System.

In 2017, UM acquired 203-bed Metro Health Hospital in Wyoming, a suburb of Grand Rapids, and invested more than $40 million in the hospital.

UMHS also has 15 primary care health centers and medical specialty facilities in 26 cities across the state that include five Southeast Michigan locations.

In metro Detroit, they are multispecialty clinics Northville Health Center, Livonia Health Center and Brighton Health Center, and two outpatient cancer centers: UM Radiation Oncology at Providence Cancer Center in Southfield and the UM Radiation Oncology at Assarian Cancer Center in Novi.

"University of Michigan to build $920 million hospital it calls 'most advanced' in Michigan" was originally published in Crain's Detroit Business.