Hospitals seeking help from stimulus

The American Hospital Association is lobbying for more help from the federal stimulus package being debated in Congress, arguing that hospitals are delaying or canceling upgrades that would benefit their communities.

Nationally, 45 percent of hospitals say they’ve delayed capital projects that had been scheduled for the next six months, and 13 percent said they’ve halted projects altogether, according to a survey by the association. Some respondents answered “yes” to both questions.

“Making these renovations and upgrades do more than just improve care. They create jobs,” said group CEO Rich Umbdenstock. “In tough economic times, health care is especially vital.”

The projects included new buildings, durable medical technology and computer upgrades. The top reasons for putting them on hold included uncertainty about the future, declining operating performance and reserves and less access to usual sources of capital. Eighty to 90 percent of hospitals said the were having a harder time raising money for projects from the usual sources: operating reserves, donations, investment income and borrowing.

Surveys were sent to 5,000 member hospitals in late December and early January, and the 639 responses came from a representative mix of geographic regions and urban and rural facilities.

“As the House considers their plan this week, we hope this survey helps them keep in mind the tremendous economic needs hospitals serve,” Umbdenstock said.

A provision in the House version of the stimulus package would help by giving incentives to banks that buy tax-exempt bonds, a key financing source for nonprofit hospitals, said AHA lobbyist Mike Rock.

“We’re hoping a provision like that can not only encourage banks to buy bonds but also in kind of a second-hand way get the market moving again,” he said in a conference call with reporters.

The group wants another provision added that would increase the budget for a U.S. Housing and Urban Development program that provides hospitals mortgage insurance, plus grants and other help for institutions that don’t meet all of the program’s requirements – especially one requiring three years in a row of financial surpluses. Rock said the addition would cost “millions, not billions.”

“There might be quite a universe of hospitals that might not qualify but could avail themselves of some kind of subsidy to get in that program,” he said.

In Columbus, the hospital systems have not put major projects on hold. Nationwide Children’s Hospital is building an $800 million expansion, Ohio State University Medical Center is in the design phase of a $1.3 billion expansion, and Mount Carmel Health System plans a standalone emergency department for Canal Winchester in a joint venture with Lancaster-based Fairfield Medical Center.

OSU budget officials told trustees in November the hospital system’s annual $80 million in routine renovations, construction and equipment upgrades would continue separately during the eight-year project. That hasn’t changed, medical center CEO Dr. Steven Gabbe said Friday.

“We monitor our financials every day,” he said. “At this time, we’re going ahead with our plans.”

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