CINDY BISHOP

The Commission on Streamlining Government has been meeting weekly since late summer and during a mid-November meeting, the Commission held a hearing relative to reopening Charity Hospital in New Orleans. In specific, the Commission considered Resolution AGEB #17 in favor of rebuilding the existing Charity Hospital building.

Steve McDaniel, an architect and an executive of RMJM Hilliard (now with Perkins and Will) specializes in sustainable healthcare design. He has recommended gutting the building. The Veterans Administration would take over the area where LSU is designated. The cost is estimated to be $484 million to reuse the existing building or $620 million from the ground up plus tax credits and soft costs would equate to a 34 percent savings by reusing the existing building. McDaniel distributed handouts depicting two site plans. Site plan B has a more compact design. The VA Hospital would be moved closer to Claiborne, Charity renovated, which would conceivably result in more efficient use of land, and a big piece of mid-city saved.

New Orleans Council member Stacey Head reported that the Department of Veterans Affairs was amenable to operating in site close to Claiborne, moving LSU into Charity. Former DHH Secretary David Hood testified before the Commission on Streamlining Government. He recommended that Louisiana state government must revise their plan for hospital construction in New Orleans. He said the new facility is needed to attract the highest level of healthcare delivery.

Treasurer Kennedy questioned why Adams Consulting said this proposed renovation plan will not work.

Brad Ott, a vocal advocate for reopening Charity Hospital also spoke before the commission. He stated that Adams was contracted by LSU before the storm (Hurricane Katrina) to develop a report to consolidate Charity and LSU in New Orleans. A report was issued in June 2005. However, a 2002 report stated that Charity Hospital was antiquated and outmoded for modern healthcare and that LSU needed a new hospital.

Charity Hospital was originally built in 1938.

Kennedy posed the question, assuming we can get FEMA money and start construction today, when would the new LSU hospital be open? One answer is that it would take five years to test pilings, drive final pilings and clear the neighborhoods.

Jerry Jones, speaking on behalf of the Division of Administration, stated that the official response of the Veterans Administration is not moving to the LSU site. The VA does not want to go through site selection again but rather will build on the site already secured. He distributed a chart showing over that 70 percent of the property is not a historic neighborhood – only 6 acres is considered mid-city historic land.

He discounted the claim of a phase 2, saying that each project must plan for expansion and that designers must work within program functions. "Gutting charity will not meet program requirements" said Jerry Jones. He said that the factual cost of the hospital project is $430 million.

To further compound the issue of reopening Charity Hospital is the fact that historical preservationists are fighting against demolishing the old hospital. It was reported that the Foundation for Historic Louisiana has sued FEMA and the state of Louisiana to stop construction because the facility is an historic property.

RMJM one of the top 5 firms contracted by National Trust for Historic Preservation, claims that historians have personal vested interests in building dealings.

According to testimony provided to the Commission, the program deficiencies include: a failing exterior; a six month design time is not feasible (six month design time is only for exterior redesign, then building design will progress, the plan originally had 600 beds, then 423, then 360 sized at 75 percent capacity).

Other variables have changed since the development of the original business plan.

There has been an increase in population in the Greater New Orleans region; currently there are significant constraints to healthcare access in the Greater New Orleans area and healthcare utilization is currently at a low level.

Senator Jack Donahue opined that there seems to be a general consensus that reports must be updated including recent shifts in economy, population, utilization etc. A major question remains as to how a new facility will impact Louisiana financially, especially with considerations about federally funded healthcare.

Another huge consideration needs to be that the disproportionate (DSH) money will soon be depleted. DSH is the large amount of money the federal government contributes to pay for uncompensated healthcare. Additionally there will be a funding shift from DSH dollars to medical insurance by Medicaid to cover an additional 300,000.

If Medicaid is expanded, we will receive less DSH funding and Charity will have to compete with area hospitals for patients with insurance.

Treasurer Kennedy posed the question, "How will Charity compete with OLOL, Ochsner, Touro?" One of the answers he received in response is that "we should rethink where we have public hospitals, how they operate, and what the physician level in the community is. We must treat it like a real hospital and redesign the operation plan."

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