13 Oct Telluride Hospital District: Path to New Med Center
Telluride Hospital District Chairman Larry Mallard and Mountain Village Mayor Dan Jansen discuss funding strategy and path to a new medical center in Mountain Village.
Telluride Hospital District (THD) Chairman Larry Mallard and Mountain Village Mayor Dan Jansen facilitated a community update on plans for the new Telluride Regional Medical Center (TMC) in Mountain Village.
The presentation outlined the limitations of the current facility in the face of a growing community, and addressed financing strategies for the $22-25 million project. The optimum funding strategy is considered to be one that includes raising $12-16 million philanthropically and $2.5 million in grants. The remainder would be covered through a combination of bank loans and general obligation bond proposed for the November 2016 ballot.
The current 10,000 square-foot facility was built to 1978 Medical, Life Safety, Building and Energy Codes. Current codes would require the facility to effectively double in size, but wouldn’t allow for added patient care capacity. The current TMC site cannot accommodate the total square footage needed for a new facility and is not zoned to accommodate a heliport, which would be beneficial in emergency situations.
The population served by the TMC is comprised of Telluride, Mountain Village, down valley and the surrounding mesas. Of those served by TMC, 40 percent live in Telluride and 60 percent live in or outside the surrounding area.
The TMC continues to see increasing demand.
Between 2010 and 2015, primary care (PC) and emergency room (ER) visits increased 46 percent and 40 percent, respectively. In 2014, TMC saw approximately 19,000 patients. About 80 percent of PC visits are by local residents; over 50 percent of the ER visits are by guests. Forecasts show a 35 percent increase in both PC and ER visits over the next 10 years.
Project costs including construction and equipment for the new facility are currently projected to be $22-25 million. The current mill levy is expected to continue. To pay for the project, a myriad of funding strategies has been evaluated including philanthropic donations, grants, securing a bank loan, general obligation bonds, developer financing, and certificates of participation. The merits and timing of all of the options continue to be evaluated.
A feasibility study was commissioned by the THD to test a $25 million philanthropic goal for a new medical center in Mountain Village. The study consisted of 60 in person interviews and an online survey of 560 individuals that were patients of the past five years. Of those interviewed 95 percent had a positive or very positive perception of TMC, and85 percent reacted positively or very positively to the plans for the new medical center. Of those interviewed in person, 58 percent stated that supporting the TMC was either the highest or a high philanthropic priority.
The new TMC will initially be licensed as an acute care hospital, but anticipates being granted Critical Access Hospital (CAH) status within a year. Hospital licensure as a CAH will offer significant opportunities for better reimbursement by Medicare, Medicaid, and other third-party payers than the TMC currently receives.
In addition to meeting the rising demand of the growing population it will serve, the new facility may allow for the provision of additional services including: screening colonoscopies, mammography, bone density screening, MRI, and minor surgical procedures that do not require general anesthesia.
The optimum financing strategy for the new TMC is one that includes a combination of philanthropy, grants, THD reserve funds, and general obligation bonds. If the general obligation bond receives a favorable vote from the community in November 2016, financing costs for the project will be substantially lower than with alternative funding strategies. The timing of the project – when cash is needed– may require a short-term bank loan as part of the strategy. Additionally, THD will use future revenues to help fund the project.
“The completion of the feasibility study and the conclusions from the funding summit allow us to gain additional clarity on the financial piece of the project. Site selection, facility design and space programming are all important parts of this project but at the end of the day it all comes down to whether we can afford it or not. We’re encouraged by these numbers and feel we can now begin to lay a path forward for funding the project in the most responsible way possibles,” said Mallard.
The THD will continue due diligence on all aspects of the project, including clarification of the best funding model and opportunities, forming a capital campaign committee to identify fundraising goals in accordance with the feasibility study, finalizing its case for philanthropic support, and engaging the donor community.
The Telluride Hospital district will continue to host public forums to educate and update the community on this ongoing process.
THD is grateful for community support and assures transparency throughout this process.
The next opportunity for community input will be October 30th at the THD Board meeting at the Miramonte Building in Telluride.
For additional information regarding the Telluride Medical Center, visit tellmed.org.
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