Postby Nick Della Volpe » Tue Jun 25, 2013 8:43 am

Tennova reps met with folks from North Knoxville on June 24th to share information on what's happening at both locations (proposed west site and Physicians Regional Health aka St Mary's). Here are my summary notes:

6/24/2013 Meeting

INTRODUCTION: On June 24th, Tennova representatives, Melanie Robinson, Jerry Askew, and Area CEO Mike Garland, spoke to the inner city neighborhoods that will be affected by their plans to move the old St. Mary's acute care hospital to the proposed 107 acre Middlebrook Pike campus under option in the Dowell Springs area of west Knoxville. While there were no major changes in the approach discussed at the St. James Episcopal church meeting hall (from the earlier March meeting), there was a bit more flesh regarding the status of their plans and the issues driving their decision making. There focus westward is no longer in doubt, and is moving forward as fast as they can, with decisions and construction completion slated within a 4 year horizon. Site rezoning is expected by October, but obtaining a Certificate of Need is a much longer process. The project has a 4 year horizon.

BACKGROUND: It was again emphasized this is not the poorly-handled Baptist hospital abrupt-closure situation of several years ago. St Mary's has a 80 year history of serving the area and Tennova says they are committed to keeping some level of health care service at the existing downtown site (more on that later).

The basic status discussion has now been "codified" into a PowerPoint presentation. They emphasized that they have a huge investment here (although much is in an antiquated, difficult to navigate, structure that has grown by various additions since the 1930s, and which is served by a very old central power, heating and support system that would cost some $80M to replace if they stayed there for ongoing acute care.) Tennova has committed to the Sisters of Mercy to continue care there. Jerry Askew emphasized that their expenditure of some $18M for the new lobby area evidences their commitment to the site.

Melanie Robinson spoke of the St Mary's recognition for its top level of service for: joint replacement, child birthing, chest pain center, and having the busiest ER in the city (caution: that latter point, indigent care, is likely a huge cost loser and may well explain part of their haste to move west). Once again, Melanie explained how the difficulty in navigating the antiquated building, with less than ideal additions over the decades, and the new emphasis on patient satisfaction re such things argues against tackling a re-work of the existing structure in the present medical reimbursement environment. As discussed previously, shorter patient stays and the need to satisfy demands of their doctor base help dictate the push westward. (No discussion this time re better insurance coverage out there, or folks who can actually afford to pay the growing medical co-pays and deductibles of the shrinking insurance world.)

The four options considered in deciding their present course of action include:
1. Status Quo -- but the present location is not acceptable to the physicians who bring patients there (physicians’ control where patients end up. (They are the "distribution" arm of the service business that deals with customers/ patients). Drs. have already started moving out with a consequent decline in hospital business.
2. Status Quo Plus -- efforts to fix the existing infrastructure would disrupt patient care excessively
3. Build Out the Emory Rd site-- it has 60 acres. Some doctors won't go north to the Powell site.
4. Replacement Hospital, west-- a new acute care facility centered in the middle of the 11 county area population they draw customers from makes the most sense, and pleases their doctor core. Sub-acute care would remain at St. Mary's site (aka Physicians regional Medical Center).

All four options cost a lot of money, but they are convinced the replacement hospital approach works best. It satisfies their core doctor group. It represents a 50-year commitment to that site. If they continue at the present location they will continue to lose patients and will fail economically. Already gone are: orthopedic and vascular surgeons. The hospital is losing at lot of $ every month according to CEO Mike Garfield. They pay some $15.7M in taxes as a for-profit hospital. They provide some $100M in donated health care services (unspoken musing: which likely freaks out the Florida based financial guys?).

The present site (at some unspecified reduced level of occupancy and building size, some demolition of existing) could be used for:
• Primary care
• Urgent care services -- more than just walk-in clinic; about 12 to 14 hrs. daily
• Other sub-acute care - like rehab and extended nursing recovery care
• Behavioral therapy
• Administrative offices
They are working with potential partners to administer that care, but are not a point where they can prudently reveal who they are. There may even be a formal or informal confidentially agreement.

BROADER OBSERVATIONS AND Q & A: Only a fraction of the Q & A can be covered, but here are some highlights.

There are some 1500 jobs at St. Mary's (not 2000, some job downsizing has already occurred in recent years). Approximately 15% or 225 workers live in zip code 37917 and 37918. The new campus is only 5 miles further west (and, hopefully, may not disrupt area housing too much).

Jerry Askew insists the scenic highway change on Middlebrook Pike was coordinated with the two mayors and the Knoxville legislative delegation. Perhaps the mayors didn't quite understand/ recall the discussions on or about March 5th. This law change was needed because of the 35 ft. height restriction in the scenic designation (why they couldn't just exempt the height requirement through legislation was not said; just that there was no Variance or BZA type mechanism). With hindsight they should have discussed with community first.

Only 20 to 300 beds would be needed in the new acute care facility (there are 444 beds at old St Mary's; hospital stays are shorter under new medical rules). Some more extended nursing care and rehab could use some of the beds in the old St Mary's.

All is not smooth in the Tennova corporate world. Their main corporate CEO has resigned effective July 31st. The new CEO will start August 1st. Glenview Capital (which owns some 125 hospitals) is considering a take-over purchase of Tennova (which has 75 hospitals). Glenview already own 25% of the stock. Not clear what changes in direction that will portend, although Mike Garfield says there no such thing as a stable of hospital care workers anyone can really send in).

New facility is a 50 year commitment. Unable to say beyond say 5 years how long they are committed to the old site. Rejected skepticism that once they get new hospital, Tennova parent will cut staff and sell the old structure to off-load the debt ( Caution: Unlikely anyone knows what happens if there is corporate takeover though).

They have redirected their architects and engineers to prepare plans for the old St. Mary's reuse, and those are expected by the end of July. So a mid-August meeting to review those might be a good time for a follow-up meeting.

What are the area implications for a follow-up Behavioral Health reuse? Will this be an extension of the mission district? St Mary's already does some of this treatment/ care now. They don't foresee any more community impact than experienced at present. They will have a lot of space to re-purpose, and it sounds like (if one reads the tea leaves) that might be one of the partnerships being actively explored.

Stay tuned for a follow-up meeting in the August timeframe.
Nick Della Volpe
Posts: 110
Joined: Mon Jul 02, 2012 4:00 pm


Postby Nick Della Volpe » Tue Jun 25, 2013 8:54 am

numerical typo: Should read "250 to 300 beds" planned for new facility (not 20 to 300, 3rd par in Broader Observations section)
Nick Della Volpe
Posts: 110
Joined: Mon Jul 02, 2012 4:00 pm

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