Difference between revisions of "Baptist Health Care expansion"

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'''Baptist Health Care Announces Planned Acquisition of West Florida Hospital'''
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{{current}}
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The '''expansion of [[Baptist Health Care]]''' away from its main [[Baptist Hospital]] campus has been attempted on several occasions, most recently in [[2008]], when the organization announced plans to buy [[West Florida Hospital]]. However, after a major [[Wikipedia:Subprime mortgage crisis|credit crisis]] affected Baptist's ability to obtain the necessary financing, the deal was called off at the beginning of [[2009]].
  
''Commitment to Northwest Florida and South Alabama Residents Focuses on Expanded Services and Strengthened Health Care Excellence''
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==Background==
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For years, Baptist Health Care has sought to expand its service away from its main [[Baptist Hospital]] campus, which is located near Pensacola's urban core and provides indigent care for a large number of low-income patients. The hospital averages about 50 percent occupancy at any given time,<ref name="newhospital">"Baptist plans new hospital." ''Pensacola News Journal'', January 15, 2004.</ref> and Baptist has sought to transfer some of its allowed acute medical care beds from Baptist Hospital to other branches in more affluent neighborhoods. However, such a transfer is only allowed after following the state's Certificate of Need process, overseen by the Agency for Health Care Administration, which has repeatedly denied requests by Baptist Health Care. Baptist officials have argued that the process is anticompetitive and overly regulatory, and that the ability to serve more "paying customers" would offset losses and increase their financial capacity to provide charity care.
  
PENSACOLA, Fla. (June 26, 2008) – Today, Baptist Health Care signed an asset purchase agreement with Hospital Corporation of America (HCA) to acquire West Florida Hospital for $245 million. Once regulatory approvals are obtained, financing is secured and the purchase is complete, currently anticipated to be by the end of 2008, residents of Northwest Florida and surrounding areas will have expanded access to more than 60 Baptist Health Care locations. Baptist Health Care will redefine health care excellence in Northwest Florida, while remaining a locally owned not-for-profit health care organization.
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In [[2000]], a state legislative amendment that would have benefitted Baptist Health Care with a specific Certificate of Need exemption was submitted (and quickly withdrawn) under State Representative [[Durell Peaden]]'s name, though he denied any knowledge of it and claimed "[a] lot of amendments get filed with my name on them … people think if they put my name on them, they'll pass."<ref name="hard2believe">"Editorial: Hard to believe amendment story." ''Pensacola News Journal'', May 17, 2000.</ref> Baptist admitted that their lobbyist authored the amendment, but would not identify the sponsor. State Representative [[Jerry Maygarden]] was suspected of submitting it, as he was a senior Baptist executive and an outspoken critic of the Certificate of Need process; he insisted, however, "that was not my amendment and that was not my language."<ref name="hard2believe"/>
  
“This acquisition will enhance the best of both organizations and provides for expansion of our services to meet the needs of our patients and the community,” stated Al Stubblefield, President/CEO, Baptist Health Care. “For more than a decade, Baptist Health Care has earned a reputation for providing quality health care with superior customer satisfaction. By creating a strong, service-oriented culture of excellence within our organization and among our employees, Baptist Health Care has spent multiple years in the top one percent in patient satisfaction surveys. We know the acquisition of West Florida Hospital will allow us to continue our high standard of personal care while expanding services to serve the entire Northwest Florida region.
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On [[May 2]], [[2001]], in the final days of the state legislative session, Maygarden quietly arranged an amendment to a massive Medicaid bill with a provision that would allow Escambia and Santa Rosa hospitals to transfer beds to satellite facilities as needed. Officials at other major health care providers came out in opposition to the measure, saying it would benefit only Baptist, Maygarden's employer, as no other organization wanted to transfer beds. "I gave the same authority to [[Sacred Heart Health Care|Sacred Heart]] that I gave to [[West Florida Healthcare|West Florida]] that I gave to Baptist," Maygarden said. "They all have satellite facilities without beds. … I have steadily told them that what they are doing is protecting market share, and I think that's wrong. I've given them all the same options. If they don't want it, that is their choice."<ref>"Maygarden draws flak for hospital legislation." ''Pensacola News Journal'', May 9, 2001</ref>
  
With this acquisition, Baptist Health Care and West Florida Hospital will become one to bring together the best technology, services and expertise for superior quality health care for patients and families. Baptist Health Care’s main campus will continue to operate as a vital, full service outpatient facility offering walk-in urgent care services, diagnostic and imaging services, ambulatory services, physician offices and corporate management offices. The combined inpatient psychiatric services currently at Baptist Hospital and West Florida Hospitals will be housed at the Baptist Behavioral Medicine Hospital.
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The bill passed quickly, and Maygarden's amendment survived Governor [[Wikipedia:Jeb Bush|Jeb Bush]]'s line-item vetoes. After a coalition of Baptist's competitors filed suit, the law was declared unconstitutional by Leon County Circuit Judge Kevin Davey, who wrote in his ruling, "[t]he statute does not pertain to a matter of statewide importance, nor can the statute reasonably be construed to be a demonstration project."<ref>"Baptist Hospital beds won't be moving around." ''Pensacola News Journal'', December 20, 2001.</ref>
  
Once the purchase is complete, the current West Florida Hospital on Davis Highway will become the new Baptist Hospital, and together with Baptist Medical Park – 9 Mile, will give Baptist Health Care a major presence in north Pensacola. The campus will feature comprehensive inpatient and outpatient care plus world-class services such as an expanded Baptist Cancer Center in affiliation with the Moffitt Cancer Institute; Baptist Neurosciences Center complemented by a rehab hospital for neurologic and orthopaedic conditions; Baptist Heart & Vascular Center of Excellence; and an expanded Emergency Department. The new Baptist Hospital also will offer a new parking garage and new physician office buildings.
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In [[2004]], Baptist announced plans to build a $60 million hospital adjacent to its [[Baptist Medical Park - Nine Mile]] facility, which would house 96 beds transferred from the main Baptist Hospital campus. The transfer would have been the result of a coalition with about a dozen other Florida hospitals who wanted legislative exemption from the requisite Certificate of Need process.<ref name="newhospital"/> The plans were again opposed by the other area health care providers — especially [[West Florida Healthcare]], whose [[West Florida Hospital]] averaged only 33 percent occupancy and would have been less than a mile from the new hospital.<ref>"Hospitals at odds." ''Pensacola News Journal'', February 8, 2004.</ref> The [[Santa Rosa County Commission]] considered opposing the legislation on behalf of [[Santa Rosa Medical Center]], which would have been impacted by a new hospital nearby, but ultimately did not take action.
  
Additionally, Baptist Health Care will assume the current West Florida Hospital Primary Care Practices, which will increase access and outreach to the community. The addition of West Florida Hospital Primary Care Practices (nine neighborhood medical centers) to Baptist Health Care affiliated and employed physicians will expand Baptist Health Care primary care locations throughout the community, creating the largest and most convenient primary care network in the region.
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The legislation was withdrawn. However, in the same year, Baptist successfully lobbied to exempt Escambia County (among five others) from a "grow in place" bill that would have benefitted competitors like [[Sacred Heart Health System|Sacred Heart]] by allowing them to expand at existing facilities without state permission.<ref>"Bill keeps Baptist Hospital competitors at current size." ''Pensacola News Journal'', March 26, 2004.</ref>
  
This opportunity ensures that Baptist can continue to meet the growing health care needs of the poor and uninsured—a hallmark of Baptist Health Care’s mission. This expansion provides opportunities for new and enhanced health care services, based on the needs of our patients and the community. Baptist is forming a Campus Redevelopment Council to help determine future development of the main campus.
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In [[2006]], Baptist Health Care was said to be in talks with [[West Florida Healthcare]] about collaborating to improve their services and reduce costs. According to West Florida president and CEO [[Dennis Taylor]], "We're trying to find ways to work together. If we can find ways to work together, it saves the community a tremendous amount of resources."<ref>"Hospital officials mulling alliance." ''Pensacola News Journal'', July 12, 2006.</ref> These discussions were never formalized and were called off weeks later, as West Florida's parent company HCA was in the midst of a pending $33 billion buyout by a group of private investors.<ref>"Hospital alliance talks off." ''Pensacola News Journal'', August 5, 2006.</ref>
  
“This acquisition will allow Baptist Health Care to continue to be at the forefront of health care excellence in Northwest Florida. With the help of our outstanding doctors and staff, we are revolutionizing health care in Pensacola,” stated Stubblefield.
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==2008 plans==
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On [[June 26]], [[2008]], Baptist Health Care officials announced a major expansion project that included the purchase of [[West Florida Hospital]] for $245 million and approximately $85 million in new construction. The expansion was intended to be completed within a few months, with an agreed upon deadline of [[December 31]].
  
For more information about this exciting anticipated expansion, please browse [[www.BHCexpansion.org]] or call (850) 434-4080.
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{{cquote|This acquisition will enhance the best of both organizations and provides for expansion of our services to meet the needs of our patients and the community. … We know the acquisition of West Florida Hospital will allow us to continue our high standard of personal care while expanding services to serve the entire Northwest Florida region.|20px|20px|[[Al Stubblefield]], President/CEO of Baptist Health Care}}
  
==External links==
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The organization signed an asset purchase agreement with West Florida's parent company, Hospital Corporation of America (HCA), after which the necessary regulatory approval was obtained.  However, the frozen credit markets related to the [[Wikipedia:Subprime mortgage crisis|subprime mortgage crisis]] and [[Late 2000s recession|recession]] prevented Baptist from obtaining the financing necessary to close the deal. According to a financial expert quoted by the ''[[Pensacola News Journal]]'', "Baptist is pretty well leveraged. They have a substantial debt load, a lot of which comes from their financing the [[Andrews Institute]]."<ref name="dealoff">"Hospital deal off." ''Pensacola News Journal'', January 1, 2009.</ref>
*[http://www.bhcexpansion.org/ www.bhcexpansion.org] &ndash; Informational website about the expansion
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As late as October 2008, Baptist CEO [[Al Stubblefield]] remained confident that the expansion would move forward and that Baptist was "well positioned to go to the bond markets by the end of this calendar year."<ref name="dealoff"/> However, as the deadline passed with no bonds issued, the expansion will likely not take place.
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Had the purchase been completed, the current West Florida Hospital on [[Davis Highway]] would have become the new [[Baptist Hospital]], supplementing the presence of [[Baptist Medical Park - Nine Mile]] in north Pensacola. The campus would have featured an expanded [[Baptist Cancer Center]] in affiliation with the Moffitt Cancer Institute; [[Baptist Neurosciences Center]] complemented by a rehab hospital for neurologic and orthopaedic conditions; [[Baptist Heart & Vascular Center of Excellence]]; and an expanded Emergency Department. The new Baptist Hospital would have also offered a new parking garage and new physician office buildings. Additionally, Baptist Health Care would have assumed the current [[West Florida Hospital Primary Care Practices]] (nine neighborhood medical centers), creating the largest primary care network in the region.
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Because of the merger collapse, Baptist lost an estimated $8 million in forfeited earnest money.<ref>"Cost of merger collapse: $8 million." ''Pensacola News Journal'', January 4, 2008.</ref>
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==External links & references==
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*[http://www.bhcexpansion.org/ www.bhcexpansion.org] &ndash; Informational website about the 2008 expansion
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{{reflist}}
  
 
[[Category:Baptist Health Care]]
 
[[Category:Baptist Health Care]]

Latest revision as of 16:54, 4 January 2009

Current event marker.png This article documents a current event.
Information may change rapidly as the event progresses.

The expansion of Baptist Health Care away from its main Baptist Hospital campus has been attempted on several occasions, most recently in 2008, when the organization announced plans to buy West Florida Hospital. However, after a major credit crisis affected Baptist's ability to obtain the necessary financing, the deal was called off at the beginning of 2009.

Background[edit]

For years, Baptist Health Care has sought to expand its service away from its main Baptist Hospital campus, which is located near Pensacola's urban core and provides indigent care for a large number of low-income patients. The hospital averages about 50 percent occupancy at any given time,[1] and Baptist has sought to transfer some of its allowed acute medical care beds from Baptist Hospital to other branches in more affluent neighborhoods. However, such a transfer is only allowed after following the state's Certificate of Need process, overseen by the Agency for Health Care Administration, which has repeatedly denied requests by Baptist Health Care. Baptist officials have argued that the process is anticompetitive and overly regulatory, and that the ability to serve more "paying customers" would offset losses and increase their financial capacity to provide charity care.

In 2000, a state legislative amendment that would have benefitted Baptist Health Care with a specific Certificate of Need exemption was submitted (and quickly withdrawn) under State Representative Durell Peaden's name, though he denied any knowledge of it and claimed "[a] lot of amendments get filed with my name on them … people think if they put my name on them, they'll pass."[2] Baptist admitted that their lobbyist authored the amendment, but would not identify the sponsor. State Representative Jerry Maygarden was suspected of submitting it, as he was a senior Baptist executive and an outspoken critic of the Certificate of Need process; he insisted, however, "that was not my amendment and that was not my language."[2]

On May 2, 2001, in the final days of the state legislative session, Maygarden quietly arranged an amendment to a massive Medicaid bill with a provision that would allow Escambia and Santa Rosa hospitals to transfer beds to satellite facilities as needed. Officials at other major health care providers came out in opposition to the measure, saying it would benefit only Baptist, Maygarden's employer, as no other organization wanted to transfer beds. "I gave the same authority to Sacred Heart that I gave to West Florida that I gave to Baptist," Maygarden said. "They all have satellite facilities without beds. … I have steadily told them that what they are doing is protecting market share, and I think that's wrong. I've given them all the same options. If they don't want it, that is their choice."[3]

The bill passed quickly, and Maygarden's amendment survived Governor Jeb Bush's line-item vetoes. After a coalition of Baptist's competitors filed suit, the law was declared unconstitutional by Leon County Circuit Judge Kevin Davey, who wrote in his ruling, "[t]he statute does not pertain to a matter of statewide importance, nor can the statute reasonably be construed to be a demonstration project."[4]

In 2004, Baptist announced plans to build a $60 million hospital adjacent to its Baptist Medical Park - Nine Mile facility, which would house 96 beds transferred from the main Baptist Hospital campus. The transfer would have been the result of a coalition with about a dozen other Florida hospitals who wanted legislative exemption from the requisite Certificate of Need process.[1] The plans were again opposed by the other area health care providers — especially West Florida Healthcare, whose West Florida Hospital averaged only 33 percent occupancy and would have been less than a mile from the new hospital.[5] The Santa Rosa County Commission considered opposing the legislation on behalf of Santa Rosa Medical Center, which would have been impacted by a new hospital nearby, but ultimately did not take action.

The legislation was withdrawn. However, in the same year, Baptist successfully lobbied to exempt Escambia County (among five others) from a "grow in place" bill that would have benefitted competitors like Sacred Heart by allowing them to expand at existing facilities without state permission.[6]

In 2006, Baptist Health Care was said to be in talks with West Florida Healthcare about collaborating to improve their services and reduce costs. According to West Florida president and CEO Dennis Taylor, "We're trying to find ways to work together. If we can find ways to work together, it saves the community a tremendous amount of resources."[7] These discussions were never formalized and were called off weeks later, as West Florida's parent company HCA was in the midst of a pending $33 billion buyout by a group of private investors.[8]

2008 plans[edit]

On June 26, 2008, Baptist Health Care officials announced a major expansion project that included the purchase of West Florida Hospital for $245 million and approximately $85 million in new construction. The expansion was intended to be completed within a few months, with an agreed upon deadline of December 31.

This acquisition will enhance the best of both organizations and provides for expansion of our services to meet the needs of our patients and the community. … We know the acquisition of West Florida Hospital will allow us to continue our high standard of personal care while expanding services to serve the entire Northwest Florida region.

Al Stubblefield, President/CEO of Baptist Health Care

The organization signed an asset purchase agreement with West Florida's parent company, Hospital Corporation of America (HCA), after which the necessary regulatory approval was obtained. However, the frozen credit markets related to the subprime mortgage crisis and recession prevented Baptist from obtaining the financing necessary to close the deal. According to a financial expert quoted by the Pensacola News Journal, "Baptist is pretty well leveraged. They have a substantial debt load, a lot of which comes from their financing the Andrews Institute."[9]

As late as October 2008, Baptist CEO Al Stubblefield remained confident that the expansion would move forward and that Baptist was "well positioned to go to the bond markets by the end of this calendar year."[9] However, as the deadline passed with no bonds issued, the expansion will likely not take place.

Had the purchase been completed, the current West Florida Hospital on Davis Highway would have become the new Baptist Hospital, supplementing the presence of Baptist Medical Park - Nine Mile in north Pensacola. The campus would have featured an expanded Baptist Cancer Center in affiliation with the Moffitt Cancer Institute; Baptist Neurosciences Center complemented by a rehab hospital for neurologic and orthopaedic conditions; Baptist Heart & Vascular Center of Excellence; and an expanded Emergency Department. The new Baptist Hospital would have also offered a new parking garage and new physician office buildings. Additionally, Baptist Health Care would have assumed the current West Florida Hospital Primary Care Practices (nine neighborhood medical centers), creating the largest primary care network in the region.

Because of the merger collapse, Baptist lost an estimated $8 million in forfeited earnest money.[10]

External links & references[edit]

  1. 1.0 1.1 "Baptist plans new hospital." Pensacola News Journal, January 15, 2004.
  2. 2.0 2.1 "Editorial: Hard to believe amendment story." Pensacola News Journal, May 17, 2000.
  3. "Maygarden draws flak for hospital legislation." Pensacola News Journal, May 9, 2001
  4. "Baptist Hospital beds won't be moving around." Pensacola News Journal, December 20, 2001.
  5. "Hospitals at odds." Pensacola News Journal, February 8, 2004.
  6. "Bill keeps Baptist Hospital competitors at current size." Pensacola News Journal, March 26, 2004.
  7. "Hospital officials mulling alliance." Pensacola News Journal, July 12, 2006.
  8. "Hospital alliance talks off." Pensacola News Journal, August 5, 2006.
  9. 9.0 9.1 "Hospital deal off." Pensacola News Journal, January 1, 2009.
  10. "Cost of merger collapse: $8 million." Pensacola News Journal, January 4, 2008.