Metropolitan Hospital Reduces Urgency To Move

June 20, 2002
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LANSING — Metropolitan Hospital needs a little more time to formulate a deal that would lead to changes in a state rule needed to accommodate its proposed relocation to a new $155 million suburban campus.

Metro executives, who in the past have framed the need to relocate as an urgent situation, now don’t expect to make a formal pitch to the Michigan Certificate of Need Commission until December. Metro wants to see a change in rules that prevent hospitals in a market deemed to have an excess of hospital beds, as in Grand Rapids, from relocating farther than a 2-mile radius from their present location.

That request was originally expected to go to the CON Commission on Sept. 21. But Jim Childress, Metro’s marketing director, told CON commissioners that the caregiver needs more time to iron out an agreement with a task force that’s working with Metro to formulate a proposal to change the standards under which hospitals can seek relocation in Michigan.

“We’re just not there yet. We need a little more time to finish,” Childress told CON commissioners in Lansing.

Metropolitan Hospital in March announced plans to develop and relocate to a new “health care village” planned for a 150-acre site at Byron Center Avenue and Gezon Parkway, on the Wyoming-Byron Township line.

The announcement came several months after Metro began working with a task force assembled from the members of the Alliance for Health, a regional health care planning agency in Grand Rapids, and the Economic Alliance for Michigan, a Novi-based business-labor coalition, to draft a proposal to the CON Commission to change the rules governing hospital relocations.

The goal is to provide some flexibility in the 2-mile rule so hospitals in Michigan that are landlocked in their present locations, as is the case with Metro, or have other compelling reasons can at least seek permission to relocate. The 2-mile radius standard is intended to prevent hospitals from leaving urban areas with large populations of uninsured persons or Medicaid recipients for greener pastures in more affluent communities.

The process nearly fell apart in June when State Reps. Mark Jansen and Jerry Kooiman, acting on Metro’s behalf, slid an amendment into the state Department of Community Health’s 2002 appropriations bill that essentially would have enabled the hospital to move without going through the usual regulatory review process. The move — which Metro CEO Mike Faas explained was a fallback option stemming from fear that efforts to change the CON relocation standard would stall — angered task force members who saw the legislative maneuver as an end-run around their efforts.

Metro has since returned to the table and is committed to striking an agreement with the task force “on a public policy approach that would serve the interests of all concerned,” Childress said.

“We have engaged in a very productive dialog,” Childress said. “We’re very focused on doing what’s in the best interests of our community, and as a result, significant progress has been made.

“We absolutely believe they’re acting in good faith,” he said of the task force.

The task force is working with the “full intent” of recommending a rule change that meets its goals and Metro’s goals, and is applicable to hospitals statewide that are in a similar situation, Alliance for Health President Lody Zwarensteyn said.

The task force has focused its efforts on four areas: improving access, improving quality, reducing costs and addressing an excess of hospital beds in the Grand Rapids area.

Metro and the task force quickly resolved access and quality issues, leaving costs and the number of beds in the new hospital as the sticking points.

The hospital already has committed to lowering its number of licensed beds from 238 to 200 at the new facility. Task force members have pushed for an even larger reduction.

“It’s still a wide-open dialog on that topic,” Childress said.

On the economic issues, Metro executives project a new hospital will generate efficiencies that produce $5 million in cost savings annually — a savings they’ve promised to share with the community. The question to resolve is exactly how to spread the savings.

Childress declined to comment on the specifics of the talks involving both issues. 

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