Truman Medical Centers, whose Lakewood facility serves a large number of people in Eastern Jackson County, is asking Jackson County with help to replace old buildings and upgrade services.
Officials are hoping for a $41.55 million repair and replacement program at the Lakewood campus at Gregory and Lee’s Summit Road, including $17.1 million for a 1908 building and $16.2 million for a 1928 building. Overall it’s identified $150 million in needs over the next decade.
“At the Lakewood campus, we need to add beds. … The demand is growing,” TMC President and CEO Charlie Shields told county legislators this week. Legislators expressed general support but said several issues need to be talked through.
TMC has outlined plans for both campuses – Lakewood and at 23rd and Holmes on Hospital Hill – but Shields said the most urgent needs are at Lakewood, repeating a case the TMC officials have made to county legislators for several years.
“We think this is the time,” Shields said.
The most pressing issue, as officials describe it, is to deal with an “urgent need for upgraded facilities” at Lakewood. Tight space is preventing the expansion of services with growing demand, such as births and drug treatment.
Legislator Ronald Finley, D-Kansas City, acknowledged the needs, saying “ … that building at Lakewood – we’ve been looking at it and looking at it. It’s about to fall down.”
Also on the table for Lakewood: adding “med/surg rooms,” adding two operating room suites, expanding the Family Birthplace and a new three- or four-story medical office building. Hospital Hill could get permanent space for Recovery Health, a cath lab renovation, a renovation of “key clinical areas” and a completion of a $19 million campaign to expand the neonatal intensive care unit.
“It is at capacity,” Shields said of the NICU. “That is not the standard of care that we believe in.”
Officials stress the hospital’s importance to the community, particularly for people with few or no means to pay. About one patient in five at TMC has no private insurance, Medicare or Medicaid, a far higher rate than seen at other Missouri hospitals. It gets far less private insurance reimbursement than a typical Missouri hospital, and overall it deals with patients who come in sicker.
In fiscal year 2019, the hospital provided $148 million in uncompensated care – $40 million of that to residents of Eastern Jackson County. That’s 13 to 14 percent of all uncompensated care in Missouri, Shields said.
Uncompensated care – the amount a hospital writes off when a patient simply cannot pay – was at $130 million just two years ago.
“We’ve seen a fairly dramatic increase in our uncompensated care,” Shields said.
In addition, TMC last year provided $2.73 million in care to inmates at the county jail, for which it is not reimbursed.
In the past, Shields has pointed out that about half of the babies born in Kansas City each year are delivered at TMC, including 85 to 90 percent of those born into poverty.
Legislator Crystal Williams, D-Kansas City, said Jackson County has better health outcomes than in many other places in the state.
“And a lot of that is because of Truman,” she said.
Plans to upgrade
The county has given the hospital $9.88 million a year for the last five years – about half for debt service and half for operating costs. But, Shields argues that historically the county’s support was around $12 million a year; it fell year by year during and immediately after the Great Recession a decade ago, when county revenues fell.
The hospital’s pitch is this: Go back to $12 million a year, with all of the money going for debt service (except $2 million in 2020 to finish off fundraising for the NICU). The hospital could then issue $160 million in 30-year bonds. It says service upgrades would mean it could bring in more revenue and cover the amount the county is currently paying as an operational subsidy.
TMC stresses that interest rates are low right now.
“If you’re going to issue debt, we believe this is the time to do it,” Shields said.
County legislators did air concerns.
“There’s a risk there,” said Williams, chair of the Budget Committee, adding that the county is contemplating the major cost of a new jail at some point. County-backed bonds for TMC now would change the math for jail bonds in the future. Also, locking in TMC’s full $12 million for debt service, with none for an operational subsidy, would limit the county’s financial flexibility.
Williams said she supports the idea overall, and Legislature Chair Theresa Galvin, R-Lee’s Summit, said she agreed.
“Let’s just do it correctly,” Williams said.
Most states expanded Medicaid coverage under the Affordable Care Act, but Missouri is among a handful that hasn’t. That issue could be on the ballot in 2020.
Shields said Missouri’s policy has hurt the hospital financially.
“But even with Medicaid expansion,” he said, “there will be that need out there.”