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Wheeling Hospital Plans $50M Tower

Taken from The Intelligencer / Wheeling News-Register

WHEELING - Not all the economic news during the current recession is bad, as on Wednesday Wheeling Hospital announced it would proceed with a $50 million expansion to the facility.

A new "Tower 5" would house additional emergency room facilities, expanded intensive care units and more physician office space, according to information presented at the hospital’s board of directors meeting Wednesday evening.

During the meeting, the board passed a resolution to authorize the filing of a "certificate of need" application with the West Virginia Health Care Authority. It’s the first step in building the hospital expansion, officials said.

The application could be approved within three months if it goes unchallenged - or the process could take up to six months if there are objections, said James Murdy, Wheeling Hospital’s chief financial officer.

Murdy said groundbreaking for Tower 5 could happen in late summer or early fall. The facility would take two to three years to complete.

Discussion about the expansion came after Murdy told the board that the hospital’s investment portfolio had taken a loss of more than 19 percent this year, resulting in a significant loss of non-operating income.

He said that Wheeling Hospital’s non-operating income for the first two months of 2008 was nearly $3.1 million, versus $1.2 million for the first two months of 2009.

It was noted by Murdy that the hospital also spent $2.5 million this year to replace every hospital bed.

"The hospital as a corporation is doing well in terms of net operating income," he said. "We are exceeding our budget expectations.

"But like all hospitals with an investment portfolio, we’ve experienced large declines in our investments."

He added, though, that the hospital "doesn’t live on our investments" in terms of daily operations, and that investment dividends are used to fund future projects at the hospital.

Still, he believes that as long as operating revenue streams at the hospital remain strong, the money will be available to handle a $50 million building project.

"I’m confident of that," he said. "There are other things we will have to work on, such as physician recruitment."

The proposed Tower 5 was described as providing for the following:

  • The first floor would house a new emergency room with 30 treatment rooms and four trauma centers.
  • The second floor would be home to an expanded pediatric and obstetrics department, while larger intensive care and cardiovascular intensive care units would be constructed on the third floor.
  • The medical/surgical nursing unit would gain additional space by relocating to Tower 5’s fourth floor.
  • The fifth and sixth floors, meanwhile, are viewed as "shell space" for future expansion.
  • The seventh floor is designated for additional physician office space.

Since fall, hospital officials have been reviewing financial options for the expansion with PNC Bank. A preliminary financing plan was received by Wheeling Hospital last month, and alternative sources of funding also are being considered, Murdy said.

He said management has been meeting with local trade unions to negotiate up-front rate discounts, and meetings have been successful.

This winter, hospital officials solicited bids from four unidentified contractors, and those bids have been narrowed down to two companies based on their guarantees to bring the project in under $40 million - with an expected $10 million adjustment to account for the seventh floor physician offices not in original plans, bringing the total building cost to $50 million.

"As a hospital, we’ve been worrying a lot about debt," said the Most Rev. Michael Bransfield, bishop of the Catholic Diocese of Wheeling-Charleston. "But we have to do what is best for the community.

"These are difficult economic times. The hospital is going to be able to pull through them, and be able to put something together for the future."