Building a new state hospital alongside a planned U.S. Department of Veterans Affairs medical center in lower Mid-City won't produce the initial level of savings once touted by the Louisiana State University System, according to the school's top health officer.
Dr. Fred Cerise said the primary reason is that a lack of clear financing has put LSU behind its original schedule, while federal money is lined up for the Veterans Affairs hospital slated to open in 2012, negating plans for sharing some equipment and facilities.
"We are not at a point of planning these facilities in sync and opening the same day," Cerise said last week. "(VA officials) can't plan on building a hospital that depends on the sharing of critical components."
The admission comes as the state continues to wrangle with the Federal Emergency Management Agency over how much Louisiana is due for Hurricane Katrina damage to the shuttered Charity Hospital. The state wants the full reconstruction cost of $492 million, which represents more than a third of the $1.2 billion proposal for the new 424-bed academic teaching hospital.
FEMA's standing offer is $150 million, with appeals and mediation looming.
Not knowing the resolution leaves the state without a firm timeline on its hospital.
"Until they see more certainty" on the state's end, Cerise said, "(VA officials) are not going to leave out critical functions of their hospital. That kind of tempers the sharing."
Cerise and VA spokesman Rob Goza said architectural and design teams continue to work together. They said that doctors could still work in both hospitals and possibly share some diagnostic equipment.
"We anticipate to share services still," Cerise said.
Nonetheless, Cerise's comments mark the first time LSU has publicly backed away from its previous estimates of more than $400 million in operational savings over 25 years for the two hospitals, which together are slated to cover a 70-acre plot bound by Claiborne Avenue, Tulane Avenue, Rocheblave Street and Canal Street. Galvez Street will divide the two campuses.
Cerise said he has no revised savings estimate.
His statements also represent a small victory -- at least in terms of framing the debate -- for those historical preservationists and citizen activists who continue to fight LSU's site selection. Many of those groups have accused LSU of overselling the "synergy" argument as justification for the Mid-City site.
Sandra Stokes, spokeswoman for the Foundation for Historical Louisiana, said "it raises questions about the whole plan."
The foundation and other groups advocate that the state gut Charity and build a new hospital within its shell, while using the closed VA campus to the west for expansion and support buildings. Veterans Affairs, under the alternative, could occupy the lower nine blocks of the Mid-City plot.
LSU and VA maintain that their site selection is final.
--- Designs remain separate ---
As recently as a Jan. 22 legislative hearing in Baton Rouge, Cerise and his boss, LSU System President John Lombardi, cited the $400 million in savings through synergy as one of the advantages of the dual site.
Cerise told legislators: "That's modeling that was done over a year ago when we sat down at the table with the VA and talked about what we could share and what could go back and forth. That's a big deal to the VA, it's a big deal to us."
The modeling Cerise cited is from a September 2007 study commissioned by VA and LSU. The precise amounts were $122 million for VA and $296 million for LSU, which Cerise said would be about 3 percent of the state hospital's operating revenues. The estimates were based on the concept of a joint hospital with separate patient towers, one for LSU, one for Veterans.
As Cerise spoke in Baton Rouge, state and federal officials, along with interested planners and preservationists gathered in New Orleans to see preliminary renderings of the hospitals.
Separate design teams showed sketches of distinctly separate hospitals with no shared infrastructure. There would be two emergency departments, two clinical complexes, no overlapping lab facilities, separate energy plants and parking facilities.
LSU's patient towers fronted Canal Street in both of its designs, while the three VA concepts all fronted Galvez Street, which was a clear divide of the campuses in any combination of the renderings.
Cerise said last week, "The idea that we'd have one base building with a VA tower and an LSU tower -- that's obviously not going to happen."
He said the design teams are discussing having just one central energy plant, an infrastructure piece that accounts for $84 million of the state's construction budget. Cerise also said LSU would like a raised, closed walkway spanning Galvez to connect the two hospitals, though he could not guarantee that will be in the next round of renderings.
VA officials declined to discuss the specific plans pending further study of the potential sharing and its savings.
Goza said there is "active discussion" to share high-cost equipment, kitchen and food service, the central energy plant and work force training space.
Historically, LSU and VA have shared hyperbaric therapy, trauma, radiology-oncology and obstetric-gynecology services.
"The goal of building both projects side by side is to create an environment where both organizations can take share their strengths and expertise by making it simple and efficient for the medical staff to 'switch hats' by simply walking to the VA Medical Center and back," Goza said.
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"Savings won't be realized with new hospital in Mid-City - VA, LSU out of sync on sharing services"
Monday, March 16, 2009
By Bill Barrow, Staff writer