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UConn: Medical Facility Dated

Trustees To Be Told New Hospital Crucial

January 30, 2007
By WILLIAM HATHAWAY, Courant Staff Writer

The current John Dempsey Hospital will have to be replaced with a significantly larger, brand-new $495 million facility if the UConn Health Center in Farmington is to remain financially viable, health center officials are expected to tell UConn trustees today.

Health center officials are asking the trustees to approve a new, 354-bed hospital at its Farmington campus to replace the current 224-bed hospital.

The 546,000-square-foot facility would be financed by the sale of bonds, private contributions and - if approved by the state legislature - $45 million already earmarked for health center renovations under the UConn 2000 program.

Health center officials declined to comment on the plan, but in documents prepared for today's meeting they call for moving the entire hospital into the new building and using the current hospital for other purposes.

The proposal is likely to face strong opposition from both Hartford Hospital and St. Francis Hospital and Medical Center.

Although officials at both hospitals declined comment Monday, in previous discussions of a Dempsey expansion they have argued such a move would siphon off suburban patients with private health insurance, burdening urban hospitals with an even higher percentage of government-insured patients who are treated at a loss.

However, echoing a familiar argument, UConn officials contend that the 30-year-old hospital cannot incorporate new technologies and offer the best standard of care to patients unless it grows.

The hospital is too small to be profitable and without the ability to treat more patients in the growing Farmington Valley market, Dempsey will inevitably lose money, they say. And - officials warn - without a financially healthy hospital to support research and medical school, the entire mission of the health center is in jeopardy.

The health center includes the hospital, the university's medical and dental schools and research facilities.

"The state's only public Health Center faces a series of falling financial barometers that once again threaten its mission and even its survival," wrote Dr. Peter Deckers, dean of the UConn Health Center, in a letter submitted to the health center board.

The plan calls for building a new six-story facility in front of the existing hospital entrance. In addition to more beds, the hospital would contain new operating suites, neonatal intensive care units, an expanded emergency room and additional parking. If approved, the new facility would create 300 new jobs, the university estimated.

If UConn's trustees approve the plan, the state legislature needs to approve sale of the bonds, which would be repaid by hospital revenues, as well as expenditure of UConn 2000 funds for the project.

The health center also would have to gain approval from the state Office of Health Care Access, which reviews plans to add new hospital beds in the state.

Dempsey and other hospitals across the country are facing similar economic challenges. Reimbursements for government health insurance programs such as Medicare and Medicaid have not kept track with the rising cost of care.

On average, Medicare, which insures elderly patients, now reimburses Connecticut hospitals for about all the cost of treatment, according to a recent study by a state program review and investigations committee. But Medicaid, which covers the nation's poorest patients, currently reimburses about 73 cents for every dollar worth of treatment, the committee reported.

Those trends have left hospitals chasing privately insured patients to compensate for shortfalls and the expense of treating uninsured patients.

The UConn Health Center faces additional problems. The research wing has been hit hard by reductions in federal funding. Only about 1 in 10 research proposals receive funding from the National Institutes of Health, compared with 1 in 4 just a few years ago, health center officials say.

And, health center officials argue that the state's contribution to the educational and research missions of the health center have not kept pace with expenses.

But some of the same forces are also buffeting urban hospitals, which serve an even higher percentage of underprivileged patients than Dempsey. While St. Francis and Hartford Hospital have avoided losing much money in recent years, their profit margins have been thin.

Dempsey, Hartford, St. Francis and other hospitals in the area have been locked in a battle for the same pool of insured patients, whom they need to stay financially afloat. A dramatic expansion at Dempsey could upset that equilibrium.