Two suburban hospitals, one in Elmhurst and one in Naperville, have received approvals for major construction projects from the Illinois Health Facilities Planning Board.

The approvals came after executives from each hospital answered questions about higher than standard costs per square-foot.

Elmhurst Memorial Hospital is building a new facility on a different site and Edward Hospital is continuing expansion at its existing location.

The largest of the two projects is the new Elmhurst Hospital, estimated to cost $475 million. It will be located on a 50-acre site on the south side of Elmhurst.

In addition to the new hospital building, two medical office buildings are planned on the site. That particular construction will require an additional Certificate of Need (CON) approval process. The CON is required by state law before construction can begin on major health care projects.

One office building will include cardiac care and the other will have women’s services and cancer care. Mainly used for physicians’ offices, the two buildings will be connected to the new hospital. Also connected to it will be the Center for Health, an existing outpatient building.

Leo Fronza, president and chief executive officer of Elmhurst Memorial Healthcare, addressed the Board regarding the negative finding by the State Agency Report (SAR) about the proposed construction cost.

“We are confident that our estimated construction costs are realistic. In fact, we recently sought bids for 60 percent of the project and found that our cost estimates are on target,” he said.

“I think it is important to note that our project costs are less than ...for some comparable projects. Most importantly, the adjusted state standard used for this project is lower than that used for some other new or replacement hospital projects and major additions to existing hospitals in the Chicago area.”

The cost listed in the state agency report includes new construction and modernization of 1,042,501 square-feet of space.

The 866,000-square-foot new hospital building will contain 259 private rooms. The building is expected to be ready for occupancy in 2010. Most of the existing services on the 11-acre site near downtown Elmhurst will be moved to the new campus west of York Road and north of Roosevelt Road.

Two services—skilled nursing care and behavioral health services—will remain on the existing hospital site, according to Fronza. He said although a lot of the buildings on the existing site will be taken down, there is an opportunity to reuse some of them.

He further noted that the community needs other services, including those for seniors, but plans have not been defined at this point.

Following the testimony and questions, Susana Lopatka, acting vice chairman of the Illinois Health Facilities Planning Board, said the explanations were sufficient. She called for a vote in which she and three other members of the Board approved the Elmhurst proposal.

At another hearing later in the day before the Board, an Edward Hospital executive also addressed questions about costs exceeding the state norms.

“Obviously, this is not an issue new to the Board or to Edward Hospital,” said Denise Vaughn, vice president for planning and business development. “Rest assured that we have no interest in paying more for our building materials, construction workers and related costs than is necessary.

“Like many other applicants appearing before you, I think that the primary issue is escalation; with a second and every bit as important factor in this project being the nature of our construction and renovation we are undertaking.”

She explained that the hospital is renovating an existing physical plant and working in a land-locked, tight environment. Some parts are as much as 50 years old. Construction will be done on top of an existing structure and will include a costly bridge to other parts of the hospital.

Nearly 90 percent of the renovation work is being done in the surgical suite.

“Obviously, we cannot close the suite during the renovation,” Vaughn said. “As a result, we are incurring costs for the repetitive erecting and removal of quite elaborate dust barriers, and for the premium pay for nighttime and weekend work. We believe our costs are reasonable.”

After the testimony and questions, Lopatka said the Board’s concerns had been addressed. It then approved the $81 million expansion, which includes a two-floor addition to the west building. It is part of a nearly $200 million makeover on the Naperville campus on South Washington Street.

The previous phase of the overall expansion/renovation was $16.9 million to add 14 OB beds and nine intensive care beds. That portion was approved by the Board in October.

Over the next five years, Edward Hospital plans to invest nearly $200 million in a “makeover” of its Naperville campus through a series of expansion and renovation projects, according to Keith Hartenberger, a public relations specialist for Edward.

Upon completion, Edward will have:

• upgraded OB services,
• added ICU beds,
• renovated and expanded surgical facilities,
• provided new cardiac cath capacity
• built out the Heart Hospital addition.

The projects will include 124,000 square-feet of new construction and 76,000 square-feet of renovation and will add more than 30 licensed beds to Edward’s current licensed bed count of 311. More than 70 beds (rooms) will be renovated or replaced.

The most visible element of the “makeover” will be two new floors added to the existing two-story west building. Plans are to start construction this year and open by 2010. The new third floor of the building will have 20 ICU beds. The new fourth floor will house a new 26-bed state-of-the-art NICU, including 14 private rooms for premature newborns, as well as two 16-bed nurseries and a family waiting area.

After 2010, there are plans to renovate the first floor of OB with additional capacity triage and family waiting. The second floor will continue to be dedicated to postpartum cases.

Hartenberger said a total renovation of surgical services over the next several years will result in the replacement of two operating rooms and include advanced technology and a redesign of the space to improve efficiency, work flow and storage.

Other highlights targeted for the next 12 to 18 months include:

• The current construction of the new seventh floor of the Heart Hospital. A total of 28 cardiovascular and medical/surgical beds, is expected to be ready for patients this fall.
• The fourth floor of the bed tower will become additional OB/postpartum space with 28 beds and an interim nursery.
• The sixth floor of the Heart Hospital will be built out to include 21 CCU beds and conference space.
• A fourth cath lab is planned in the Heart Hospital.