Why Hagerstown is concerned about hospital's planned move

December 16, 2003|by William M. Breichner

Dear Hospital Board Members:

Recently, an "Open Letter" published in The Herald-Mail and signed by the Washington County Health System Board of Directors stressed the need for the Hospital to expand and to provide advanced medical technology and modern convenience for patients and employees.

As we have repeatedly said in the past, the Hagerstown Mayor and Council think that is a commendable goal and therefore have fully supported a modern up-to-date hospital.

But, as you're well aware, we have questioned the merits of building a new, more expensive hospital at the Robinwood site. As you will observe by review of our submission to the Maryland Health Care Commission (MHCC) our concerns for the Robinwood site are mainly financial and related to accessibility.

Proposed Rate Increase

To finance the project, the hospital will require a two-step 13.44 percent cumulative rate increase that is proposed to be fully effective by July 2005, three years prior to the date the new hospital is proposed to be placed into service. This proposed rate increase will cost payers an estimated $25.0 million per year in additional health care expenses.

The effects of this rate increase will be an increase of more than $125,000 per year in self-insured employee health care expense to the City of Hagerstown, a larger increase to the Washington County government and the Board of Education, plus an additional $1.8 million per year in medical costs to the State of Maryland. These increases are in addition to normal rate increases for medical cost inflation.

Recently, Nelson Sabatini, Secretary of the Maryland Department of Health and Mental Hygiene, spoke before members of the Hagerstown-Washington County Chamber of Commerce and declared that "the health care system in the United States, in my opinion, is facing a very serious crisis" because of increasing costs. The secretary urged business leaders to take a major role in confronting the rising cost of health care. We fully agree with Secretary Sabatini.

Your proposed project at Robinwood will substantially increase health care costs, when attractive and less costly alternatives are available.

Less Costly Alternatives

The hospital analysis of various alternatives found in their application to the MHCC clearly indicated that it will cost at least $25 million more to build and operate the proposed hospital at Robinwood than it will cost to build a new hospital within the City. The selection of the Robinwood site was the most expensive alternative considered by the hospital. Your architectural design expert has stated that 10 acres is a reasonably sized site for the construction of a downtown hospital. For the cost of acquiring five residential properties (less than $600,000) the hospital could have an 11.5 acre site on which to construct a new hospital next to the current one.

If portions of the current hospital, which were placed in service in 1985, were incorporated into a new adjacent hospital, up to $100 million could be saved in construction costs. The indications were that those additions had a 50-year useful life and were constructed to accommodate vertical expansion. Please keep in mind that we have never suggested renovations.

These less costly alternatives can serve both the hospital and the community well, by providing new state-of- the-art health care facilities without the financial impact on the community that will result from building at the Robinwood site.


As we have stated, another of our concerns is accessibility. In reviewing a map of metropolitan Hagerstown and Washington County as well as where residential and business growth is occurring, the current city location of the hospital remains central to the area. Although the Robinwood area is experiencing considerable growth which might suggest that it is a reasonable location, due to a concentration of development, there is also significant growth occurring to the north and west of the City.

In fact, we are estimating that the current trends in those areas far exceed that which is occurring east of the city. Moving the hospital away from its current central location places additional demands on accessibility, particularly as it affects emergency, medical, law enforcement and fire service, as well as senior citizens and lower income residents.

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