Jupiter Medical Center seeks to nearly quadruple the size of its cancer treatment center and has received a $25 million donation for its cancer treatment center from an unidentified donor.
The 207-bed nonprofit hospital wants to expand its 20,000-square-foot cancer treatment center by 54,300 square feet.
Now known as the Foshay Cancer Treatment Center, the expanded facility would be renamed the Anderson Family Cancer Institute.
Davis & Stokes Collaborative designed the three-story building that would house the expanded cancer treatment center.
The new building would rise on a surface parking lot with 32 spaces. Jupiter Medical Center just bought 6.1 acres north of its campus at 1240 Old Dixie Highway for another parking lot and additional facility development.
Steven Seely, vice president and chief operating officer of Jupiter Medical Center, told the South Florida Business Journal that construction of the expanded cancer treatment center could start in May and conclude by September 2019.
Source: The Real Deal
Healthcare investors and executives talk up the benefits of mergers, promising better quality and lower costs.
Health economists are not so sure.
Policy wonks threw a dose of reality on the enthusiasm of the recent merger wave, as they gathered at the National Health Policy Conference in Washington this week. Evidence presented suggests that bigger is not necessarily better in healthcare, and that less competition amounts to higher costs and poorer patient outcomes.
“Consolidation, of course, is not the same as integration,” Katherine Ho, associate professor of economics at Columbia University, said. “One hospital system buying up more hospitals doesn’t necessarily lead patients to shift into one entity which generates scale.”
The end of 2017 saw a slew of mergers and partnerships and into 2018, as the industry hunts for efficiencies amid competition and rising prices. The year ended with the proposed CVS Health buy of Aetna and opened with a splashy partnership between Amazon, Berkshire Hathaway and J.P. Morgan.
The volume of hospital mergers picked up steam in 2010. Nearly 40% of the 1,412 hospital mergers that occurred from 1998 to 2015 were concentrated from 2010 to 2015.
While the volume has ebbed and flowed since 2012, its activity is pacing steadily. Large systems have been especially active; there were eight transactions of health systems with nearly $1 billion or more in revenue announced last year, according to Kaufman Hall.
Promises and Evidence
Hospitals look to consolidation for leverage in negotiations with insurers. If two providers merge, they in theory have the upper hand to walk away from payers, which want to build out a valuable provider directory for customers.
When promoting merger deals, hospitals tout how efficiencies will create better savings and outcomes.
For example, amid the Care New England-Partners merger deal, Brigham Health President Dr. Betsy Nabel said, “By combining the talent, experience, and resources of our two organizations, we will achieve more integrated, coordinated care offered conveniently — in the right place at the right time — improving outcomes and reducing the rise in healthcare costs.”
Several strings of evidence suggest otherwise. If you’re the only game in town, there are fewer incentives to improve. Data points cited at the conference include:
A report finding that prices increased 28.4% to 44.2% after a merger between Sutter Health and Summit Medical Center.
A study of hospital competition finding patients in the least competitive areas experienced 1.46 percentage points higher mortality rate from acute myocardial infarction than the most competitive markets.
An analysis of the merger between Evanston Northwestern and Highland Park hospitals that found four out of five insurers increased prices substantially after the 2000 merger.
Nathan Wilson, economist in the antitrust division at Federal Trade Commission, presented data highlighting how concentration in cardiology markets was associated with a 5-7% increase in the likelihood of death in some populations.
Regulators have blocked several big healthcare mergers in recent years, including hospital tie-ups.
The Trump administration has not waded in as of yet, but with the big proposed pairings announced at last year’s end, they will have to soon.
Antitrust laws need more teeth, and should be bolstered not just across markets but also within markets, at both the federal and state levels, according to Ho.
Other ideas floated at the conference include breaking up existing monopolies and imposing conduct remedies, limits to avoid anti-competitive behavior.
But these moves also have the potential to hurt patient care.
“In healthcare, if you try and unscramble eggs, you have to think about a reasonable disruption of care,” Wilson said.
And the FTC may not be able to keep up.
“I think the prospect for antitrust to disrupt entrenched provider positions is not enormous,” Wilson stated. Even blocking a “very vanilla merger” is a costly endeavor, he added.
“All future deals need to be assessed on individual merits,” Wilson said. “It’s entirely possible we might see evidence that some given transaction, either horizontal or vertical, will be associated with benefits. But maybe we should be adjusting our priors about the likelihood of that.”
Source: Healthcare Dive
Westlake, a new city under development in northwest Palm Beach County, has approved its first medical facility.
The city recently approved the site plan for a 10,379-square-foot, free-standing emergency department, with room to add a 2,000-square-foot medical office building. It would be at 16400 Persimmon Blvd., which is at the corner of Pratt Whitney Road.
Minto Communities, the master developer of the residential community at Westlake, will sell the 5.66-acre site for the medical facility to Universal Health Services. UHS owns Wellington Regional Medical Center. Patients in need of emergency medical care could visit the facility in Westlake for treatment and, if they need to be admitted for overnight care, they would be transferred to the hospital.
Construction should start by the end of this year. Minto couldn’t say when it would be completed.
“This is our first significant non-residential project to date at Westlake and the first major expansion of Wellington Regional Medical Center outside of its current campus,” said Minto VP John Carter. “In the early stages of our community development for Westlake, we have started the process of creating essential services for our future residents and those who already live in the surrounding communities.”
Minto has been approved to build 4,500 homes and about 2 million square feet of commercial space at the 3,800-acre community. The first phase, with 325 homes, is currently under development. It’s also working on plans for a town center.
Orange County Mayor Teresa Jacob and Orlando Mayor Buddy Dyer both favor proceeding with negotiations between the University of Central Florida to take over Sanford Burnham Prebys Medical Discovery Institute at Lake Nona, according to recent correspondence between the two government officials.
After a contentious Jan. 23 county commission meeting, Florida Hospital sent a Jan. 30 letter to each local funding partner officially withdrawing its proposal for Sandford Burnham from consideration.
“That currently leaves us with the UCF proposal, which again is the one that was preferred by the county,” wrote Jacobs in a Feb. 2 letter to Dyer and the Tavistock Group.
She goes on to say that UCF is proposing to lease the medical facility on a long-term basis and provide rent payments estimated at $2 million to the funding parties. UCF said it would work with the Sarah Cannon Research Institute in Nashville,Tenn., Hospital Corp. of America (NYSE: HCA), Provision HealthCare and Altercare as partners.
Jacobs said the purpose of her letter is to set a date with stakeholders to determine if everyone favors moving forward with the UCF proposal.
Dyer responded to the letter on Feb. 6: “Given the need to move forward in a timely manner and that no other proposals have been brought forward after the public presentations, the city of Orlando supports negotiating with UCF to lease the site currently occupied by Sanford Burnham Prebys. This includes developing the appropriate draft agreements and bringing them to the city of Orlando and Tavistock for review and consideration.”
However, Dyer indicated one concern is UCF’s timeline for when it will occupy the building.
“Since the [Board of County Commissioners] supported the proposal with a less definitive timeline [compared to Florida Hospital], we would expect that should negotiations not be completed before [Sanford Burnham] vacates the facility, Orange County would be responsible for any ongoing maintenance and operations of the building created by a gap in tenancy.”
He concluded his letter stating that the UCF medical school has been a catalyst for growth and is confident about working with it.
“We now have the opportunity to meet with Sanford Burnham Prebys, finalize our proposal and present a complete plan to Orange County officials. We are eager to create an academic cancer research and treatment center that will serve our community – patients, researchers, providers and taxpayers,” Dr. Deborah German, dean of the UCF College of Medicine, told Orlando Business Journal.
Every industry is contending with technological disruptors, and the life sciences are no different. The commercial real estate industry is front and center in this disruption, according to CBRE analysis, and Chicago in particular is poised for growth.
The life sciences industry—roughly encompassing the pharmaceutical, biotechnology and medical device sectors—has a wide spectrum of commercial real estate needs, including conventional offices, sophisticated research laboratories and cutting-edge production facilities. And this sector is growing: life sciences employment jumped 13.5 percent between 2006 and 2016 (compared to 6.9 percent for the U.S. economy as a whole) while venture capital investments in life sciences are 53 percent higher than they were 10 years ago.
“When you look at the landscape of investment opportunities within the commercial real estate sector, few asset classes offer as compelling a case for near-term optimism as the life-sciences industry,” said Scott Marshall, CBRE president of advisory & transaction services, investor leasing.
The CBRE study found a significant correlation between the vibrancy of a region’s research and development sector and the health of its broader life sciences industry. As a traditional pharmaceutical industry center, Chicago has emerged as the hub of the Midwest’s vibrant life sciences industry. To remain competitive and encourage broader growth, however, the region may need to focus more on research and development.
A public-private nexus of life science research currently pervades the region. Major pharmaceutical and biotech companies including Astellas, Lundbeck and Horizon Pharma lead the industry, along with medical device and diagnostic companies such as Abbott, Sysmex, Omron, Baxter and Siemens Clinical Diagnostics.
Institutions such as Northwestern University, the University of Chicago and the University of Illinois-Chicago (UIC) conduct important medical research while Northwestern, the University of Illinois and the Illinois Institute of Technology (IIT) run world-renowned engineering departments, particularly in the fields of informatics, biomedical engineering and nanotechnology. The Chicago region also possesses two major federal research labs: the massive Argonne National Laboratory science and research center outside Lemont, and the U.S. Department of Energy’sFermilab near Batavia.
“Chicago is well-positioned for future growth in life sciences thanks to its large cluster of pharmaceutical and biotech companies and world-renowned research institutions such as Northwestern University, the University of Chicago, Rosalind Franklin University and the University of Illinois at Chicago, Fermi and Argonne Labs” said Scott Brandwein, executive vice president with CBRE in Chicago.
CBRE’s analysis found that regions with high concentrations of R&D jobs—such as Boston, the Bay Area and Raleigh, NC—saw the highest growth in their overall life-sciences job bases over the past 15 years. Markets focused more on the pharmaceutical and medicine-manufacturing industries—such as Philadelphia, New Jersey and Chicago—will likely grow at a slower pace. But with the fifth-largest life sciences industry in the country, Chicago has the momentum to compete more effectively with other major centers like the Boston-Cambridge and San Francisco-San Jose metros.
The region features a number of accelerator programs to turn research into start-up. The Chicago Biomedical Consortium, for example, aims to stimulate collaboration among biomedical researchers at Northwestern, University of Chicago, the UIC and others. In addition, the Chicago Innovation Mentors (CIM) program is focused on early-stage, science-based ventures between universities and their technology transfer groups. CIM was recently acquired by and integrated into MATTER, a larger effort to foster development of health care technologies among 50 new companies.
All of Chicago’s medical schools have added new research space in the past five years and continue to expand. Northwestern is currently building the 1.2-million-square-foot Simpson Querrey Biomedical Research Center next to its medical school in downtown Chicago, to be the largest university medical research building in the country. Some of this space will be earmarked for industry collaboration.
The development of science parks at IIT, Illinois Science + Technology Park in Skokie, University of Chicago, Illinois Medical District and the new Rosalind Franklin University of Medicine Science Innovation and Research Park should aid in attracting international life sciences companies to Chicago, as well as increase the overall number of start-ups.
“With existing vacancy extremely low for lab space, there is demand for more product in this market,” Brandwein said. “This now has the government and private sector focused on this need and is beginning to facilitate the expansion with some new projects in the development pipeline.”
Life sciences employment growth in Chicago has been challenging, however. Between 2002 and 2016, life sciences employment fell by 13.6 percent, due in part to the relocation of some R&D companies like Baxalta (now Shire), Abbvie and Takeda to Cambridge. The trend of life sciences employment losses in Chicago is relatively unusual in that it was not limited to pharmaceutical and medicine manufacturing jobs, like in other mature markets, but extended into the R&D sector where employment in Chicago was cut almost in half in that same span. Unlike in other parts of the country, there has been no discernible uptick since then.
Since life sciences manufacturing companies have an outsized presence in Chicago, total life sciences employment in the region has been closer to the national average recently. About half of Chicago’sNIH funding in 2016 went to Northwestern University, with the bulk of the rest to the University of Chicago, UIC and Rush University Medical Center.
A relative lack of venture capital funding for life sciences in Chicago and the Midwest remains an impediment to higher growth, but a small increase in funding over the past few years is promising. Venture capital funding to Illinois companies in 2015 and 2016 was comparable to the total distributed over the prior eight years.
Several of Chicago’s biotech/specialty pharmaceutical companies have been targets of very successful M&A activity in recent years. Mergers such as Allergan’s $560 million acquisition of Evanston-based Naurex and Lundbeck’s $900 million acquisition of Deerfield-based Ovation Pharma demonstrate that Chicago has developed high-value companies.
Immense opportunities and acute risks aside, the life sciences industry benefits from a host of important secular growth drivers. Nonetheless, the outlook is complicated by increasing demands placed on the industry from government, insurance companies and consumers for more effective and cost-sensitive solutions.
Florida Hospital is breaking ground on two new stand-alone emergency departments later this year in Waterford Lakes and Oviedo, expanding its presence on the east side of Metro Orlando, the health system announced Thursday.
“We want to be where you live, with a complete network that’s easy to access. This will lead to steady growth in the coming years,” said Daryl Tol, president and CEO of Florida Hospital, in a news release. “Our new centers in Oviedo and Waterford Lakes are just the next step in our aggressive multiyear plan.”
The Waterford Lakes emergency department, located at Colonial Drive and Lake Pickett Road, is expected to break ground in June and open in summer 2019. The health system has closed on the purchase of the 5-acre site, according to a news release.
The Oviedo facility is planned on Red Bug Lake Road near Oviedo Mall Boulevard — about a mile away from HCA-owned Oviedo Medical Center, an acute-care hospital with an emergency department.
Florida Hospital already owns that piece of property, which also houses a long-standing Florida Hospital Centra Care urgent-care center. Groundbreaking is planned for October and the new facility is expected to open in fall 2019.
“Many Oviedo residents are established patients in the Florida Hospital network and seek it out when they need emergency care, so having this option available closer to home will be a real benefit,” said Oviedo Councilwoman Megan Sladek, said in the hospital news release.
Both facilities will have 24 beds. Their design will be finalized after input from the city government and residents, the health system said.
Source: Orlando Sentinel
About Florida Medical Space
Florida Medical Space. Florida’s first and only statewide, full service medical real estate company. A highly focused and specialized team of investment, marketing, leasing and management professionals at your full disposal so you can focus on what matters most.