Getting the ball rolling on securing management for the hospital’s operations and new construction are the most immediate tasks facing new trustees of Allen County Hospital.
In their first act of official business Tuesday night, members approved Harry Lee as chairman, Karen Gilpin as vice chair, Jay Kretzmeier as secretary and Debbie Rowe as treasurer.
From there, Lee steered trustees through the evening’s agenda with the guiding hand of Chuck Wells, president of Healthcare Financial Advisers, the consultant hired by the county.
First, Wells advised trustees to decide on “the team,” to oversee construction of the hospital.
In short order trustees discussed with Steve Lewallen, architect with Health Facilites Group, the proposed site on East Street. Lewallen has been on board with the project since summer when HFG was retained to study whether a new hospital or renovation of the current hospital was the best option.
Lewallen expressed his desire to continue as architect for
the new hospital and came with contract in hand, which he left with trustees.
The design of the hospital “is the longest element of work,” Wells said and urged trustees
to give Lewallen strong consideration.
This summer, HFG won out over 10 other firms to conduct the study of the hospital.
“We’re already heavily invested in the details of a new hospital,” Lewallen said on his firm’s behalf.
Wells said trustees could go with HFG, or “open the door to another beauty contest,” of potential candidates. Trustees do not have to take bids to hire an architect.
They must, however, do so for bids for a construction management firm to handle the hospital’s construction.
Phil Schultze of the Murray Company of Kansas City was hired as the construction engineer, who helped write the Master Plan Report that concluded a new hospital is needed. Schultze, too, was at Tuesday’s meeting.
Kansas law dictates that at least three firms compete for the role
of construction manager.
Requests for proposals will be extended in the “next few days,” Wells said.
A 15-day notice in the local newspaper is required before bids are closed, he said, which will push a decision on a construction manager into mid-December.
Of course the site of the future hospital first must be settled before either an architect or a construction firm can do much of anything.
Lewallen said he was “comfortable,” with the East Street location but wanted to know the exact details to assure himself of their potential. He also said he preferred a larger site to work with than the 7.5 acres targeted.
“Ideally, I’d like 12.5 acres,” he said. That much land is available if lots to the north of Monroe street are included, Jim Gilpin, a member of the audience, said.
Once a site is secured, the architect and the construction management team then work “hand-in-glove” Wells said on the design of the building.
In short order, trustees need to get the site appraised and proceed with negotiations for their purchase. Time is of essence, Wells said. “We want to be as far along as possible by this time next year” in order that during next winter construction is confined to indoors.
THE FINANCING of the hospital can put trustees at rest if an underwriter is engaged, Wells said.
He recommended they continue with Greg Vahrenberg of Piper Jaffray, a Leawood finance investment group.
Vahrenberg would serve as “our eyes and ears,” to the bond market, which “is still volatile,” Wells said. Piper Jaffray also would advise trustees on how to structure financing for the new hospital in compliance with federal and state laws.
Deciding what firm will manage the hospital is already in the works, beginning with the current management team, Hospital Corporation of America.
Joyce Heismeyer, chief executive officer of the hospital and an employee of HCA, said HCA has expressed an interest in managing the hospital when its role of leasing the hospital has ended and the county takes over.
Retaining HCA in that role would have distinct advantages, Wells said, including transfering ownership of some of the equipment HCA has purchased in the seven years it has been associated with the hospital.
“Their goodwill could probably do us more of a favor than us trying to beat them up with a bid process,” said David Toland. Toland served on the Hospital Facilities Commission this summer.
Though Allen County Hospital is one of the smallest hospitals HCA leases, “we do not go unnoticed,” Heismeyer said. HCA especially benefits from the many referrals Iola physicians make to other hospitals operated by HCA, most notably Wesley Medical Center in Wichita and Research Medical Center and Menorah Medical Center in Kansas City and Lee’s Summit Medical Center.
Trustees are not obligated to seek bids from corporations to manage the hospital.
It is also important to secure a hospital management team soon to develop electronic medical records, Wells said. Federal law mandates that hospitals have such systems up and running by 2013.
HCA has the ability, Heismeyer said, but no incentive to do so unless they will continue to be involved.
TRUSTEES will meet every Tuesday evening through the end of the year. Typically meetings begin at 7 p.m. in the Assembly Room of the courthouse. On Dec. 7, the meeting will begin at 6 p.m. to allow time to hear bids from underwriters; the Dec. 14 meeting will begin at 4 p.m. to hear bids from construction management firms. Each presentation is expected to last one hour.
All meetings are open to the public.
