Last month, Ward 7 DC Councilmember Vincent Gray introduced a bill that would bring a new hospital to St. Elizabeths, a former psychiatric hospital near the Congress Heights Metro that the District plans to redevelop. The expectation is that a private management firm will want to take over the facility, and that it will be an economic spark plug for surrounding neighborhoods.
According to the Washington Business Journal, “Gray proposes creating a program that would lure anchor retailers — including paying construction costs and waiving taxes — to the east end of the city.”
It's actually an idea he first put forth in 2014, when Gray was DC's mayor, but it most recently came up on Thursday, when Gray pressed mayor Muriel Bowser about why her her recently-released 2018 budget proposal doesn't include funding for the project. For her part, Bowser wants to spend money on rebuilding the decaying United Medical Center (UMC), but wants to find an operator before going all in.
— Martin Austermuhle (@maustermuhle) April 6, 2017
Hospitals can indeed be great catalysts for development, and one at St. Elizabeths would certainly have much more of an economic impact on the surrounding community than the athletic facility for Washington Wizards practices and Washington Mystics games that is to be built on a neighboring parcel.
Whereas that facility will attract a few thousand spectators to the area perhaps a couple dozen times a year and have a limited number of full-time employees on-site during the week, a hospital is a 24/7/365 activity center with a large number of employees and consumers rotating in-and-out over the course of the day.
Due to the nature of a hospital's activities, it's likely that these users would want to stick close-by for meals and other shopping needs — naturally providing a base of support for retail activity nearby. Some employees at the site would doubtless want to live close to their workplace, providing a built-in demand for residential development in the vicinity.
Lastly, a hospital would probably be a magnet for other healthcare services that benefit from proximity to a medical center — producing at least some demand for the local office market.
So, slam-dunk idea, right? A replacement for UMC, right on top of a Metro station, in the core of a major available development parcel? Perhaps so, but whatever the site for a UMC replacement, we must approach this endeavor with a clear-eyed view of what glass-and-steal will and will not do for healthcare service delivery in the District — particularly emergency care.
Ever since DC General closed in 2001, the burden of uncompensated and indigent care has been spread around — but has fallen hardest on UMC and Howard. Howard's troubles were recently documented in the Post, while UMC has failed in private hands and has been consistently propped up by the DC government for the past several years.
You can create a new hospital, and if your goal is to provide a better facility for patients, offer more healthcare services in an underserved area, and catalyze economic development — perhaps it's a good idea at this location. But how realistic are the costs for doing that, and what are the prospects for cost recovery?
This hospital will have the same challenges UMC has now: a high rate of uninsured consumers, poor reimbursement rates from the insurance that consumers do have (in large part, Medicaid), and a service population with a high rate of expensive-to-treat chronic conditions. UMC has to transport a lot of trauma patients to George Washington and Washington Hospital Center now; if the goal is to provide another such center for a service area that badly needs it, that will add on more costs.
Perhaps all of this is worth subsidizing as a matter of equity and policy, but the District needs to be realistic about the costs and not set a false expectation that by investing a bunch of money in a physical facility that they can buffalo some private company to take it off their hands without any further involvement. This city has been in denial ever since Tony Williams closed DC General about the need for a public hospital in the District; they keep propping up UMC, and numerous turnaround plans that were supposed to get the facility into the private sector promised land have come and gone.
So, does there need to be a UMC replacement? Yes, it's an aging facility that the District has spent well over a hundred million dollars on just to keep its physical plant in order over the last decade. But to me, you can't plan for a replacement without also acknowledging the role that the District has to play in the operation of a new facility over the long-term. Maybe they can find a private operator who can run the new facility more efficiently, but they will need to keep subsidizing care heavily in any case — and I doubt creating a sparkling new facility is going to significantly impact that financial trajectory.