Hospitals seek funds for expansion, retrofitting: Tri-City, Palomar Pomerado, Sharp, Scripps systems have ambitious plans.

Hospitals countywide will collectively spend at least $2 billion to meet state earthquake building codes, but that isn't stopping them from planning unprecedented facilities expansion projects--some as high as $1 billion.

Public and private hospitals are seeking funds, including property tax increases, loans and private donations, to carry out these projects

Palomar Pomerado Health, or PPH, and Scripps Health each has a $1 billion expansion plan, and Tri-City Medical Center and Sharp Grossmont will decide in the coming weeks if they'll ask the public for hundreds of millions of dollars to complete a $400 million and $225 million plan, respectively.

La Mesa's Sharp Grossmont, with 481 beds, is owned by the public Grossmont Healthcare District, but leased to Sharp HealthCare, a private group of four hospitals.

While PPH, which serves inland North County, recently struck a deal with Escondido city officials, agreeing to pay $19 million in infrastructure improvements to build a new hospital on its preferred site, Tri-City and Sharp Grossmont are spending big bucks on public relations campaigns to ready voters for the possibility of bond measures that would pay for seismic updates and building expansions.

Tri-City, a nearly 400-bed hospital serving areas including Carlsbad, Oceanside and Vista, recently spent $300.000 on two 30second television commercials and $90,000 on fliers mailed to residents.

The commercials, which emphasize aging facilities and the need for disaster preparedness, have its competitors convinced that the Tri-City Healthcare District board of directors will agree at its March 8 meeting to ask voters to allow the board to borrow money--likely hundreds of millions of dollars.

Grossmont is also airing commercials, for which officials there spent $416,000, said Grossmont Healthcare District Director Barry Jantz.

Getting The Word Out

"They are running the ads to prep communities," said Chris Van Gorder, the chief executive officer of Scripps Health, a private, nonprofit system that is home to five hospitals. "It's the marketing before the flurry."

Because Scripps is private, it cannot qualify, for publicly funded bond measures, but hopes to obtain wide support from private donors and philanthropic events to help pay for its 10-year, $1 billion overhaul and expansion, which its board of trustees is to consider in the coming weeks.

"Scripps has always been blessed with strong community support, and it is needed now more than ever," Van Gorder said, adding that officials are unsure of how much money might be donated or borrowed.

Van Gorder said Scripps' proposal includes a new hospital tower at the 372-bed Scripps Memorial Hospital in La Jolla--the first of a three-phase plan to rebuild the hospital to meet seismic requirements. Also at the La Jolla location would be a new 5,000-square-foot imaging pavilion to house sophisticated bone scanners. The billion-dollar plan also consists of new intensive care units and an expanded emergency room at the 700-bed Scripps Mercy Hospital; a new hospital tower and expanded emergency room at the 140-bed Scripps Memorial Encinitas; and four new parking structures throughout the system, among other projects.

Mirror Image

Tri-City's campaign is nearly identical to PPH's successful 2004 bid for $496 million to help pay for its expansion, to begin in 2007 and be complete by 2010, said PPH spokesman Andy Hoang, who led the campaign.

"What they are doing today mirrors everything that we did two years ago before we hit the ground with an aggressive awareness campaign to ask voters to pass the largest bond issue ever passed in California for local health care," Hoang said.

The Palomar approved bond issue means homeowners pay an extra $17.75 per $100,000 of assessed value on their homes.

Grossmont's proposal, which would see the June primary ballot if its board opts for that route, would mean an additional $19-$20 per $100,000 assessed property value for those who live in the district, according to Grossmont.

All of the hospitals' plans must be approved by the Office of Statewide Health Planning and Development, or OSHPD, which can take about a year.

Focusing On Growth

Allen Coleman, the vice president for strategic services at Tri-City, said the hospital district plans include an expanded emergency room and intensive care unit, as well as renovations that would meet seismic codes, though not until the project's third phase.

Coleman would not disclose an overall expansion cost because he said administrators are still "working with the numbers," but confirmed the price tag is "in the same magnitude of" $400 million, which was the dollar amount the hospital included in its request for proposals from contractors.

Coleman said the public hospital has been considering a bond measure since before PPH received approval from voters in 2004.

"Some of the things they have done have educated us on what the taxpayers are looking for and not looking for, so hopefully (PPH's bond passage) will give ours a better chance of passing," Coleman said, adding that the board has not yet voted on whether to ask the public for money to pay for the project.

Palomar's expansion includes a new 453-plus-bed hospital to be located in the Escondido Research and Technology Center Park, south of state Route 78 and west of Interstate 15. The number of beds at Pomerado Hospital in Poway will nearly double to more than 200, and the medical center in downtown Escondido will undergo a more than $70 million redesign. The downtown hospital will transition from an acute care hospital to a facility that will provide physical rehabilitation, urgent care, behavioral medicine, administrative offices and some commercial space. The health system also wants to spend $10 million to create four satellite medical centers.

Van Gorder said that during PPH's campaign to persuade voters to pass the bond issue, the public health system used the need to meet seismic codes as a crutch to gain public money for its facilities expansion. The project has grown to nearly $1 billion, which Mike Shanahan, PPH's facilities director and project architect, said is due to price jumps in materials and land, as well as other changes to the project.

It's The Law

Hospitals in San Diego will spend at least $2 billion to bring facilities into earthquake compliance, according to the Hospital Association of San Diego and Imperial Counties, or HASDIC.

According to the Office of Statewide Health Planning and Development, 973, or 37 percent, of the state's hospital buildings would pose a significant risk of collapse and danger to the public in the event of an earthquake. State law requires these buildings be retrofitted, replaced or removed from acute care services by Jan. 1, 2008. However, some hospitals, such as Tri-City, have requested an extension, and therefore have until 2013 to comply. Other buildings that pose less threat have until 2030.

Steve Escoboza, HASDIC's CEO, said some hospitals believe it is more efficient and cost-effective to expand and update facilities while they are renovating and building to meet seismic codes.

Sharp HealthCare broke ground in 2004 on a 315,000-square-foot, 334-bed hospital to be completed next year at its Sharp Metropolitan Medical Campus. It will be the first new hospital in San Diego since 1953, according to Sharp.

Van Gorder said both population growth and state-mandated building codes for earthquakes have triggered the flurry of construction and renovation projects.

"Timing might have been slightly different if it weren't for (state seismic deadlines)," Van Gorder said. "But now, we have to look at it differently while remaining competitive."