Spectrum Plans Massive Expansion

June 20, 2002
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GRAND RAPIDS — Spectrum Health, moving to shore up its grip on the West Michigan health care market, plans to spend millions in the decade ahead to build an outpatient cancer center and new children’s hospital in downtown Grand Rapids, plus additional medical campuses throughout the region.

Joining existing plans for a new $88 million heart hospital at the downtown Butterworth Campus are a $35 million outpatient cancer center to complement Spectrum’s existing cancer treatment facilities, replacement of DeVos Children’s Hospital, and the development of new ambulatory and outpatient facilities and services in Kent, Muskegon and Ottawa counties.

The “Patient Services Care Plan” unveiled last week solidifies the intentions Spectrum has consistently outlined since the 1997 merger of Butterworth Hospital and Blodgett Memorial Medical Center that created the regional health system.

The goal is to eventually consolidate inpatient medical services at the downtown Butterworth Campus to generate further cost savings and extend outpatient services outward. Spectrum presently estimates that the merger has produced $373 million in savings since 1997.

The plan serves as a “road map for Spectrum Health to remain West Michigan’s premier health system and meet the growing needs of this region,” Chief Executive Officer Richard Breon said.

“We are creating an environment of care that supports our vision and strategic plan,” Breon said.

With Blodgett and Butterworth now fully integrated, the plan represents Spectrum’s view of what it needs to do over the next 15 years to keep up with the region’s expected growth and increasing demand for health care.

Spectrum would take on projects in succession, with work on the cancer center starting once the heart hospital is completed in 2004. Construction on the heart hospital is scheduled to begin next month.

Occurring concurrently with construction of the heart hospital is a $13 million expansion of the emergency, laboratory, radiology and radiation oncology departments at the Butterworth Campus.

Replacement of DeVos Children’s Hospital and development of new ambulatory and outpatient campuses would occur in later years, with the latter phase including development of a facility on a 75-acre site at I-196 and Leffingwell Avenue on Grand Rapids’ northeast side which, prior to the merger, was once considered for a new Blodgett Hospital campus.

Spectrum’s aim is to shore up its current market share, not expand it, within its present 13-county service area, Spectrum Communications Coordinator Bruce Rossman said.

“We’re making each of these moves to accommodate the patients we have now and accommodate the growth we have in our own patient base for the next 15 years,” Rossman said.

Spectrum last month sold $150 million in bonds to finance the early phases of the building plan.

The plan is consistent with the goals Spectrum Health has publicly outlined since the 1997 merger, said Lody Zwarensteyn, president of the Alliance for Health.

“This is part and parcel in what the merger was all about,” Zwarensteyn said. “Spectrum has to bring its facilities together if it’s to realize the promises of the merger.”

With the Patient Services Care Plan completed, Spectrum executives will set to work to choose sites for each new facility and develop cost estimates for projects planned for the future.

“Now planning proceeds to saying, ‘How can we do this?’” Rossman said.

Spectrum is already the largest provider of cancer care in West Michigan, holding a 66 percent share of the market. The new outpatient facility “will assist us in elevating our regional cancer center to a national level,” Breon said.

Though not a surprise, the Spectrum plan offers the latest wrinkle in a Grand Rapids health care market that’s already in for some major construction projects.

Saint Mary’s Mercy Medical Center plans to begin work next spring on a $42 million cancer-treatment center, and Metropolitan Health is working to secure state approval to relocate to a $155 million suburban hospital campus it wants to develop in Wyoming.

Jim Childress, Metro’s market director, says Spectrum’s building plans provide credence to Metro Health’s proposal to relocate to the suburbs and out of Grand Rapids, where all three of the area’s major hospitals are located.

“It’s just a reminder of how consolidated services are now and are going to become in a relatively small geographic area,” Childress said. “It’s good to allow the hospitals to be a little more spread out.”

While the new facilities that are planned would add to Spectrum’s presence in the market, they are not in response to plans by Saint Mary’s and Metro, Rossman said. The new facilities were already being considered before the Saint Mary’s and Metro proposals evolved, he said.

“Saint Mary’s is doing what they need to do to serve their patient base, and we’re doing what we need to do to serve our patient base, and the same with Metropolitan” 

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