The federal government announced Monday that Texas County Memorial Hospital will receive an $18 million low-interest loan that will result in a new core institution and extensive remodeling to the existing building.

The funding – from the Economic Recovery Act passed to stimulate the economy – will result in the largest construction project ever completed in Houston. News of the award came in the form of a news release and telephone call from U.S. Sen. Claire McCaskill, D-Mo., and caps a three-year effort to obtain financing in an upside-down credit market.

Wes Murray, chief executive officer of Texas County Memorial Hospital, told the institution’s employees the announcement was “huge” for the hospital and county.

Much of the hospital’s operation will be housed in a new 58,000 square foot addition situated northeast of the existing building. A new, larger emergency department and private medical surgical patient rooms are included in the project, which also calls for remodeling, renovation and even relocation of several hospital departments.

The green light from U.S. Rural Development comes after an exhaustive financial application process that included the hospital administration and its accounting firm, BKD, LLC, in Springfield.

“With these funds, we can build a facility that can be used by the residents of this county 50 years from now,” Murray said. “Two to three generations of Texas County residents will be proud to call TCMH their hospital, and they will be able to use it to meet their primary care needs.”

The TCMH board of directors approved the project in 2007. A year later, the financial markets descended into turmoil not seen since the Great Depression. The collapse made traditional bond financing unfeasible after bids were sought. The project got new life last year when the U.S. Department of Agriculture expressed an interest in assisting. Since that time, the stimulus package included funds aimed at healthcare facilities.

Those monies are expected to include an interest rate no higher than 4 percent and as low as 3.75 percent.

“Our purpose is to take care of the patients of Texas County, and most of our patient care areas are extremely outdated and in need of major remodeling,” Murray explained. “This funding will allow the hospital to expand our facilities to meet the needs of patients in the 21st century.”

Dr. Charles Mueller, chief of staff and general surgeon at TCMH, described being “really excited” when he heard that the expansion funding had finally come through.

“This is a great opportunity for us to advance healthcare in Texas County,” Mueller said. “Our patients deserve the best, and we will be able to provide it to them.”

The hospital’s emergency department was the impetus behind the entire expansion project, as the hospital looked at renovating and increasing the size of the emergency room before looking at the whole effort. With the expansion, the emergency department of the hospital will move to the front of the hospital.

Dr. Jeff Kerr, emergency room medical director and physician, echoed comments that the community served by TCMH deserves the new expansion.

“The TCMH mission of staying in the forefront of medical technology with dedicated medical providers remains strong,” Kerr explained. “This expansion will allow us to provide the technology and efficiencies needed to take us into the future.”

Kerr noted that the expansion of the emergency department will provide full accessibility to the range of services available to patients through the department.

TCMH contacted HMN Architects in Springfield, the firm that assisted the hospital in designing the original expansion plans, and HMN will help the institution tweak them as needed.

“We have a different set of physicians that bring specialties and skill sets that we need to adapt to with our expansion,” Murray said.

TCMH will also look at how healthcare reform will affect the proposed expansion.

“We don’t know all of the changes that healthcare reform will bring, but we need to meet the primary care needs of the patients in our area,” Murray explained.

The USDA funded two portions of a three-phase plan for expansion and renovation at the hospital. Part A, the actual 58,000 square foot expansion, received $16.91 million in loan funding. Part B, the renovation and relocation of many other hospital departments in the original portion of the hospital received $1.1 million in loan funding. Part C, an approximate $5 million expansion of the surgery and obstetrics departments, was not funded.

The USDA loan was made available through Economic Recovery Act funds. TCMH was one of several entities across the nation that received the stimulus funds for a project.

The loan is for 30 years, and the interest rate will be fixed. The loan has a 4 percent interest rate, but if TCMH meets certain paperwork criteria by the end of 2010, the interest rate will be reduced to 3.75 percent.

“The USDA is incentivizing us to move forward quickly,” Murray said.

He explained that the hospital will redevelop their construction timetable as quickly as possible with “the goal of maximizing our dollars.”

“I understand that there may be some concerns and anxiety about the hospital taking on this project with our current economy,” Murray said, “but the benefits far outweigh the risks.”

Murray explained that the expansion will sustain the hospital going forward, creating a solid work environment for the 400 plus employees at TCMH.

“There is no doubt this expansion will help TCMH continue to recruit new physicians that we need as well as retaining the great physicians we already have in place,” Murray said. “With only 2 percent of physicians willing to consider practicing in a town with a population of 50,000 or less, we need every advantage we can get.”

Dr. Charlie Rasmussen, vice chief of staff and family medicine physician at TCMH, described the expansion funding as “a big deal” in moving major patient care areas from a 60-year old facility to new, state-of-the-art facilities.

“Expanding the hospital will really put Texas County on solid footing for the future of medical care,” Rasmussen said.

He believes that hospital physician recruiting and retention efforts will be enhanced by the new facility.

“Today’s physicians train in state-of-the-art facilities, and when they get out of residency, they expect to work in a similar place,” Rasmussen explained. “This will help us recruit new physicians and keep the physicians we’ve got.”

Murray believes the construction project will bolster the local economy, too, in the very near future as a general contractor moves in to take over the building project and subcontractors, some of whom will probably be local, stay in local motels, eat in local establishments, and buy fuel and other goods locally. No bid date has been set.

“I hope everyone looks at this loan and expansion project for all the benefits it provides to us,” Murray said. “As with any addition, there will be a period of inconvenience, but we welcome the inconvenience for what we will receive in the end.”

The original portion of the hospital built in 1958, referred to as the “south wing,” is still used today. In the decades following 1958, various portions of the hospital have been added: the east wing in the 1960s, the ICU in the 1970s, and ER improvements in the 1980s. In 2002, TCMH completed an addition that created a new cafeteria, front lobby and physical therapy department.

In addition to the new structure, extensive renovations are expected to older portions of the hospital, which opened its doors in 1958 after similar federal aid. Mechanical equipment in older sections is reaching the end of its life.

Some technology improvements have already occurred: The hospital earlier undertook an extensive project to convert the institution and its clinics within its service area to electronic medical records. According to BKD, TCMH is in line to receive a significant payment from the federal government as an incentive payment because it converted to the more efficient paperless system. (See related story elsewhere).


Previously: Texas County Memorial Hospital employees received the news this afternoon that the hospital received $18 million in a United States Department of Agriculture loan to expand the size of the hospital in an impromptu announcement from Wes Murray, chief executive officer at TCMH.

Murray described the receipt of funds from the USDA as “huge” for the hospital and the county.

TCMH will use the funding to expand the physical size of the hospital by approximately 58,000 square feet, creating a new, larger emergency department, private medical surgical patient rooms and to remodel, renovate and even relocate several hospital departments.

“With these funds, we can build a facility that can be used by the residents of this county 50 years from now,” Murray said. “Two to three generations of Texas County residents will be proud to call TCMH their hospital, and they will be able to use it to meet their primary care needs.”

The county hospital has been working on the expansion project since 2007, when they identified the need to renovate the hospital’s emergency department. Construction on the project was slated to go to bid in September 2008, when the collapse of world financial markets caused interest rates on bonds to increase, making the project financially unfeasible.

“Our purpose is to take care of the patients of Texas County, and most of our patient care areas are extremely outdated and in need of major remodeling,” Murray explained. “This funding will allow the hospital to expand our facilities to meet the needs of patients in the 21st century.”

Dr. Charles Mueller, chief of staff and general surgeon at TCMH, described being “really excited” when he heard that the expansion funding had finally come through.

“This is a great opportunity for us to advance healthcare in Texas County,” Mueller said. “Our patients deserve the best, and we will be able to provide it to them.”

The hospital’s emergency department was the impetus behind the entire expansion project, as the hospital looked at renovating and increasing the size of the emergency room before looking at the whole expansion project. With the expansion, the emergency department of the hospital will move to the front of the hospital.

Dr. Jeff Kerr, emergency room medical director and physician, echoed comments that the community served by TCMH deserves the new expansion.

“The TCMH mission of staying in the forefront of medical technology with dedicated medical providers remains strong,” Kerr explained. “This expansion will allow us to provide the technology and efficiencies needed to take us into the future.”

Kerr noted that the expansion of the emergency department will provide full accessibility to the range of services available to patients through the department.

TCMH has contacted HMN Architects in Springfield, the firm that assisted the hospital in designing the original expansion plans, and HMN will help the hospital tweak the plans as needed.

“We have a different set of physicians that bring specialties and skill sets that we need to adapt to with our expansion,” Murray said.

TCMH will also look at how healthcare reform will affect the proposed expansion. “We don’t know all of the changes that healthcare reform will bring, but we need to meet the primary care needs of the patients in our area,” Murray explained.

The USDA funded two portions of a three-phase plan for expansion and renovation at the hospital. Part A, the actual 58,000 square foot expansion, received $16,911,378 in loan funding. Part B, the renovation and relocation of many other hospital departments in the original portion of the hospital, received $1,102,000 in loan funding. Part C, an approximate $5 million expansion of the surgery and obstetrics departments, was not funded.

The USDA loan was made available through Economic Recovery Act funds. TCMH was one of several entities across the nation that received the stimulus funds for a project.

The loan is for 30 years, and the interest rate will be fixed. The loan has a 4 percent interest rate, but if TCMH meets certain criteria in starting the project by the end of 2010, the interest rate will be reduced to 3.75 percent.

“The USDA is incentivizing us to move forward quickly,” Murray said. He explained that the hospital will redevelop their construction timetable as quickly as possible with “the goal of maximizing our dollars”.

“I understand that there may be some concerns and anxiety about the hospital taking on this project with our current economy,” Murray said, “But the benefits far outweigh the risks.”

Murray explained that the hospital expansion will sustain the hospital going forward, creating a solid work environment for the 400 plus employees currently at TCMH.

“There is no doubt this expansion will help TCMH continue to recruit new physicians that we need as well as retaining the great physicians we already have in place,” Murray said. “With only 2 percent of physicians willing to consider practicing in a town with a population of 50,000 or less, we need every advantage we can get.”

Dr. Charlie Rasmussen, vice chief of staff and family medicine physician at TCMH, described the expansion funding as “a big deal” in moving major patient care areas from a 60-year old facility to new, state of the art facilities.

“Expanding the hospital will really put Texas County on solid footing for the future of medical care,” Rasmussen said, and he believes that hospital physician recruiting and retention efforts will be enhanced by the new facility.

“Today’s physicians train in state of the art facilities, and when they get out of residency, they expect to work in a similar place,” Rasmussen explained. “This will help us recruit new physicians and keep the physicians we’ve got.”

Murray believes the construction project will bolster the local economy, too, in the very near future as a general contractor moves in to take over the building project and subcontractors, some of whom will probably be local, stay in local hotels, eat in local establishments, and buy fuel and other goods locally.

“I hope everyone looks at this loan and expansion project for all the benefits it provides to us,” Murray said.

“As with any addition, there will be a period of inconvenience, but we welcome the inconvenience for what we will receive in the end,” Murray explained.

The original portion of the hospital built in 1958, referred to today as the “South Wing” is still used today by the hospital. In the decades following 1958, various portions of the hospital have been added, the East wing in the 1960s, the ICU in the 1970s, and ER improvements in the 1980s. In 2002, TCMH completed an addition that created a new cafeteria, front lobby and physical therapy department.

 

This week’s Herald will have extensive coverage of today’sannouncement. Video coming soon

This Oct. 7, 2010, front page of the Houston Herald announces plans for a new core hospital and major renovations at Texas County Memorial Hospital.

Leave a comment

Leave a Reply