Hospital project races time

Roper St. Francis to move ahead if East Cooper misses DHEC deadline

Roper St. Francis to move ahead if East Cooper misses DHEC deadline

Timing is key.

That's what officials from the Department of Health and Environmental Control stressed in the spring of 2006 when they approved two massive hospital projects in Mount Pleasant.

State regulators wanted to time the rival projects to match projected population growth. So they set a delay on Roper St. Francis Healthcare's new hospital project while allowing the other project, a $160 million expansion of Tenet Healthcare Corp.'s East Cooper Regional Medical Center, to get started.

But that timeline could be thrown off.

East Cooper officials face a key DHEC deadline in November that, if missed, could allow Roper St. Francis' project to open earlier. East Cooper representatives said they are proceeding on time, but Roper St. Francis said it is moving ahead as if East Cooper will miss its deadline.

"We're moving forward on our project as if they are not going to get a valid construction contract (in time)," said

Douglas Bowling, vice president of system development. "If they miss that November deadline, we're allowed to proceed."

In early 2006, officials from both companies pushed for approval from state regulators. Each had to prove the need for extra hospital beds without diluting the Mount Pleasant market and hurting health care quality.

Observers speculated that if only one project were approved, officials from the other company would likely sue. Ultimately, the lawyers weren't needed after DHEC announced in May 2006 that both projects could move forward.

But the approvals came with a large footnote. Regulators wanted to time the projects so that East Cooper would open its doors about two years before Roper St. Francis, giving the community more time to absorb the new hospital space.

State officials reasoned that building a new hospital next door was easier than building a new one across town, explained Joel Grice, director of DHEC's Bureau of Health Facilities. "East Cooper was the existing facility in town, and they're the one that showed an institutional need for beds," he said.

In an interview on Thursday, East Cooper's chief operating officer, Bill Cone, said the hospital's staff is "extremely constrained" by the current building.

Grice added that Roper St. Francis' project is located farther north on U.S. Highway 17, away from established neighborhoods but near ones that are planned for the next few years.

Now, East Cooper officials are working against a deadline that allows them to keep the advantage of opening first. By Nov. 31, project organizers have to turn in a valid construction contract, a "notice to proceed" from the architect and a building permit that allows the company to build structures, Grice said.

"When we get that contract, we anticipate that construction will start within a few weeks," Grice said.

East Cooper also hasn't filed plans with Mount Pleasant's building department to obtain a permit, a process that could take several months.

"Right now, if they submitted (plans), it would take four or five weeks before I could even review them," said commercial plans examiner Jeff Ball, who added that the company still could get the permit in time.

Cone said East Cooper will meet the deadline and open on schedule in January 2009.

So far, though, the site hasn't seen much action. The company's July progress report to DHEC says Tenet had spent a total of $734,096 on the expansion, not including land costs, and that the site had seen no construction activity.

At the same time, Roper St. Francis has spent $16,064,579 on its project, including about $15.4 million for land purchases.

Tenet's latest quarterly earnings statement, which reported a second-quarter net loss of $30 million, doesn't make mention of the East Cooper project. Public companies usually list ongoing projects, but spokeswoman Teresa Wolke said they are not required to do so. The report did mention $27 million spent on a new hospital in El Paso.

"Tenet's financial situation will not affect the construction," Wolke said. "This is an active project, and we are on schedule to meet our deadline."

However, Roper St. Francis is moving forward as though their competitor won't make the deadline, which would allow them to shed the strict schedule DHEC officials set. If that happens, officials plan to open their hospital in March 2010, a full eight months earlier than DHEC originally allowed.

Opening early could save Roper St. Francis millions of dollars. Bowling estimates that for every month construction is delayed, the project's costs increase by $1 million.

In the end, Grice says the agency isn't overly worried about scrapping its original schedule because Mount Pleasant's population will have grown enough to support both hospitals.

"We're a little concerned about them opening at the same time, but if (both projects) are delayed, the population growth can make up for the time differential," he said.

Reach Katy Stech at 937-5549 or kstech@postandcourier.com.

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