SPH gets Certificate of Need

Homer hospital expansion project clear to proceed

Posted: Friday, April 04, 2008

State officials have granted a new Certificate of Need to South Peninsula Hospital, allowing the medical facility to proceed with the next phase of its $32.6 million expansion project.

The hospital ran into problems last year when it was learned the facility lacked a valid CON for the nearly completed Phase II expansion. That project was completed in the fall, but intense negotiations then began between the hospital, the Kenai Peninsula Borough and officials with the Alaska Department of Social Services over issues surrounding a new CON that lasted through the winter.

Meanwhile, the borough placed a moratorium on the bid process for the Phase III work.

On March 28, HSS Commissioner Karleen Jackson released the review of the borough's request for a new CON, and announced that the CON would be granted without restrictions. Borough Mayor John Williams announced the development at Tuesday's Kenai Peninsula Borough Assembly Meeting.

"This Certificate of Need clears the way for the entire development of the planned Phase II and III of that hospital," Williams said.

He said the CON had been granted "with no attachments" other than a requirement that the state be notified when the hospital intended to use a shelled-in basement area. Williams went on to praise his staff, hospital officials and the public for their efforts toward arriving at a valid CON.

According the state, the new CON first authorizes what has already been accomplished, namely expending $16.3 million for Phase II construction that included a new emergency department, increased dietary and materials management warehouse space, and an expanded imaging department. That work was completed in September of last year.

Next, the document authorizes Phase III work, including a new 18-bed, single-occupancy acute care wing, reconstruction of the surgical area to create an endoscopy room with no increase in the number of surgical suites, relocation of a laboratory and pharmacy to the second floor, relocation and expansion of respiratory therapy, expansion of the laundry department on the first floor, addition of a fifth emergency room on in the Emergency Department, and a helipad on the roof of the new acute care wing.

The total cost of the Phase III construction is estimated at just under $15.1 million. It is to be completed by December 2009.

A 9,683-square foot shelled-in first floor area located below the new acute care wing must have a CON staff review prior to any use of that area, the state said.

"We are certainly pleased with the outcome, although not surprised," said Derotha Ferraro, director of public relations for the hospital, adding that hospital workers, borough officials and the community had expressed the need for further hospital expansion.

"Mayor Williams assembled a dynamite team committed to making this happen," she said. "It was the depth of the borough resources that allowed the group to focus on our response to the commissioner's concerns that resulted in successfully communicating our service area needs."

New hospital administrator Robert Letson was unavailable for comment.

With the CON in hand, Williams laid out his tentative timeline for securing a contractor to begin work on the new phase, beginning Wednesday with a lifting of the moratorium on the bid process. A pre-bid conference with potential contractors is set for April 14. Bids would be opened on May 7 and a request for a bid award presented to the assembly on May 20.

"This is an accelerated schedule but understand even on May 20 is a month behind and we do want to get this under way and get it going this season," he said.

Hal Spence can be reached at hspence@ptialaska.net.

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