State officials need more information on Dimensions Healthcare System’s proposal to build a regional hospital in Prince George’s County, which could push an approval date into 2016.
According to an Oct. 23 memorandum from the Maryland Health Services Cost Review Commission, more financial details are required from Dimensions, including: the need to borrow $77 million to ensure Dimensions has cash on hand for the hospital’s first 100 days; and an explanation assuming the commission would grant approval for an additional $21.5 million after the facility opens.
“Until HSCRC staff receives more information, we are not in a position to complete our normal … review on the financial feasibility of the project,” Gerald J. Schmith, deputy director for hospital rate-setting with the cost review commission, said in the memorandum. “The project assumes and is dependent upon a revenue increase of $21.5 million. Nothing has been provided to date that justifies this revenue increase.”
The estimated cost to build the state-of-the-art hospital in Largo is now $651 million, according to the memorandum.
It also notes how the application didn’t include the impact of Laurel Regional Hospital, a 37-year-old facility which Dimensions oversees and plans to downsize and transform into an ambulatory care center.
“Addressing these losses and bed need in more comprehensive ways given declines in inpatient services would strengthen the viability of service offerings in Prince George’s County,” Schmith said in the memorandum. “We stand prepared to review any additional information that is provided regarding future service reconfigurations as they evolve.”
Meanwhile, Dimensions has some residents upset at its plan to trim Laurel Hospital. A recent public service announcement on the Laurel Mayor Journal website asks for those in the community to contact Gov. Larry Hogan and demand to keep the hospital intact.
Dimensions spokeswoman Erika Murray said Tuesday the information requested by the HSCRC is normal part of the approval process for projects such as the regional hospital.
“Dimensions Healthcare System will provide all information requested by the state regulatory agencies,” she said. “We remain optimistic that a new regional medical center … will be built in Largo and anticipate moving our plans forward once the project is approved.”
The memorandum comes from questions raised by Robert Moffit, a reviewer for the Maryland Health Care Commission. Moffit requested the cost review board analyze whether the project is consistent with the commission’s policies. Then the health care commission would review the entire application and offer a “certificate of need” to determine whether a new hospital would be applicable in the county based on need, cost-effectiveness and other factors.
According to a letter from Moffit on Wednesday, Dimensions has until 4:30 p.m. Nov. 20 to supply a written response.
Another reason the review process could take longer comes from opposition at two hospitals within 25 miles of the Largo location — Doctors Community Hospital in Lanham and Anne Arundel Medical Center in Annapolis.
Officials from those hospitals submitted letters to the commission in May opposing the plan, questioning the business plan, the viability of its cardiac surgery programs and the potentially adverse effect on their admission numbers.
Since those hospital officials are contesting Dimensions’ proposal, they have until 4:30 p.m. Dec. 2 to respond to any new information from Dimensions.
If Dimensions didn’t have to respond to the recent concerns about its application, the Health Care Commission could have rendered a decision this month.
If the regional hospital is approved, it would replace the 70-plus-year-old Prince George’s Hospital Center in Cheverly. The new hospital would house 231 beds, cancer and trauma centers and a behavioral health services scheduled to open in 2019.
The hospital would be built at the Largo Town Center as part of a mixed-used development slated to have 4,340 residential units, a 653-room hotel and nearly 3 million square feet of commercial and office space.
Once built, the hospital and town center could generate $3 billion in economic activity and produce nearly 25,400 jobs and $1.4 billion in salaries for the county, an economic report states.
“I am very confident we are going to have the new regional medical center because we have to,” said county Executive Rushern L. Baker III. “Dimensions can no longer stay at the site it has at Cheverly. It’s too costly to renovate. Like any process when you’re dealing with medical centers, where is the money and how do you make it sustainable? [The process] takes time, but I feel confident we will have a new hospital.”