At Greater Baltimore Medical Center, the recession, an aging physical plant and a growing patient load have come together and resulted in an ambitious building program.
The construction and renovation project will cost at least $100 million, according to GBMC President Bob Kowal.
A groundbreaking for the project took place yesterday at the Towson hospital, at 6701 N. Charles St. The improvements will take at least six years to complete and will significantly upgrade surgical and obstetric capabilities at GBMC. The non-profit health complex delivers about 4,500 babies annually -- more than any other area hospital, according to the Maryland Hospital Association.
"Everything here is 25 years old and in need of renovation," Mr. Kowal said, adding that GBMC has been receiving increasing "demand in the areas of obstetrics and surgery."
Although the nation's overall economic climate is sour, it provided a sweet opportunity for GBMC. "The recession offers us a reasonably good time to get into the construction marketplace," Mr. Kowal said. "We are hoping to buy this job with our subcontractors at good prices."
The first phase of the improvement program will cost $70 million and is expected to be finished by 1994. It includes the construction of an 110,000-square-foot, six-story structure that will house six gynecology surgery suites, physicians' offices and a cancer center.
A 900-car parking garage for doctors and GBMC employees also will be built in this phase, and 17 obstetric delivery rooms will be added.
The second phase won't get under way until 1994 at the earliest and will focus on keeping pace with medical technology and on meeting patient volume.
GBMC says the improvements won't affect patient pocketbooks, because the 362-bed facility doesn't plan to ask the Maryland Health Services Cost Review Commission for permission to increase its rates.
Instead, the money will come from other sources.
"We have a capital campaign that's been launched for $17 million," Mr. Kowal said. "We're just about at the $9 million mark at this point. Close to $3 million came from physicians."
Depreciation should generate about $40 million over the next five years, Mr. Kowal said. "Like any business, we have a depreciation line on expenses. The purpose of depreciation funds are to reinvest in your facility."
Finally, GBMC's president said the facility will enter the bond market in a few months, probably to seek about $40 million.
Maintaining tight rate controls is part of GBMC's strategy of luring corporate clients, as well as individuals, Mr. Kowal said.
"Basically, the population -- particularly industry -- is looking more and more at the cost of health care, because it's become a major item on their profit and loss statements," he said.
GBMC is ranked 38th of 52 Maryland hospitals in terms of cost per admission and recorded a $4 million profit in 1990, according to cost review commission statistics.