Does expansion make hospital leaders nervous? Yes, but...

COEUR d’ALENE — By autumn 2018, four years will have passed since Kootenai Health broke ground on its massive, multi-phased expansion. In that four years, the not-for-profit, community-owned hospital will have spent more than $100 million on expansion with more work likely ahead.

The smiles on hospital officials’ faces are real. Their glowing countenances filled the new entrance to the hospital during a special grand opening ceremony last Thursday evening, reflecting unbridled pride in their $57 million Phase 1 expansion featuring a state-of-the-art family berthing center, neonatal intensive care unit and more.

While smiles persisted during an interview at the hospital late Tuesday afternoon, they admitted that there are causes for nerves in the days ahead, now that the $45.2 million Phase 2 has been approved.

CEO Jon Ness explained there are three big parts to the project in play.

“The community sees the end result of all of this but we started our long-range strategic planning effort in 2011,” he said. “There’s a strategic plan that goes out to 2020. There’s a long-range master facility plan that was done at the same time. And there’s a long-range financial plan. What we’ve attempted to do is to marry all three of those plans together in sequence so that it works financially and operationally.”

Liese Razzeto, chair of the Kootenai Hospital District’s board of trustees, said two-thirds of the overall equation is rock-solid. It’s that third part that worries her.

“The strategic plan has stayed consistent, and I think we’re doing a good job doing the things we set out to do,” she said. “The master facility plan is obviously going. The difficulty is that with the changes in healthcare and reimbursement, the financial plan is the hardest thing. And it’s kind of the cart and the horse.”

In other words, the hospital is spending money — $100 million or so — without a firm picture of what its return on investment is going to look like. Nor is that financial plan likely to come into clear focus anytime soon.

The Press asked three key hospital leaders — Razzeto, Ness and Jeremy Evans, who’s overseeing all the expansion work — to play the “What makes me nervous, but...” game.

Ness said the enormity of the undertaking can seem overwhelming.

“Of course I’m nervous about it, but I have a lot more confidence because we just took on the largest expansion of the hospital in 30 years and completed it right on schedule, under budget,” he said.

Razzeto said the size of the commitment and the uncertainty throughout the healthcare reimbursement system are cause for concern.

“I’m nervous but know that we couldn’t meet our mission and our strategic plan if we didn’t do it,” she said. “Otherwise, people would have to leave the area for services.”

Evans, the hospital’s executive vice president of operations, agreed with Ness and Razzeto.

“I’m nervous but I’m confident in our team,” Evans said. “We’ve got an excellent construction manager, an excellent architect and an excellent internal project manager. They’ll deliver.”

All three also noted Phase 2 will be much more complex than Phase 1, adding to any nervous tension.

“These two projects [emergency and operating departments] are more complex than Phase 1 because they involve existing operations,” Ness explained. “We’ll be doing construction in an emergency department that’s still functioning every hour of every day. We’ll be doing construction in an operating department that’s still functioning every hour of every day.”

Evans said the hospital will maintain its current level of services throughout the expansion.

“The phasing spans a couple of years,” he said. “That’s intentional so we don’t ever diminish our capacity in our ORs and our emergency department.”

Razzeto paraphrased a truism uttered by Evans, then added a little humor of her own.

“Jeremy’s analogy of changing the tires while you’re going down the freeway is accurate,” she said. “You may have your surgery in the parking garage, but we’ll get it done.”