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Certificate of Need Review Activity — 2003

 

November 19 – Mat– Su Valley Medical Center submitted a certificate of need application on May 1 to build an $87.8 million 76– bed replacement facility, 52– bed shelled– in space for future expansion, and shelled space for future Cardiac Catheterization Lab. The project was approved with the following conditions: 1) The facility may build a 162,595 sq. ft., 74– bed acute care hospital overlooking the Parks and Glenn Highway; 2) the 35,095 sq. ft, 52– bed shelled– in third floor is approved with the condition that the shelled– in space shall only be used for additional medical surgical beds (any other use must be approved through the certificate of need process); and 3) the shelled– in cardiac catheterization lab is approved with the condition that laboratory services meet state utilization standards. The approved project cost is $83,682,000; a reduction of $4,118,000 for contingency fees. Contingency fees do not need to be considered in the total estimate of the project since approved projects may exceed the approved amount by 15% plus inflation. The completion date for the project is December 31, 2008.

October 30, 2003 – A certificate of need application from Renal Care Group Alaska was approved as requested. The applicant is authorized is leasing an older building and wants to relocate to a new facility rather than pay for remodeling and upgrading the facility they are currently leasing. The applicant is approved to complete the project in one of two ways: 1) they may relocate to 19,500 sq. ft of shelled– in, leased space and build– out a 35– station dialysis facility at a cost of up to $2,612,000; or 2) they may expend $6,267,000 for construction of a 19,738 sq. ft. facility if they decide to own it themselves. The new facility will be located at the southwest corner of Tudor Road and Piper Street in Anchorage . The authorized completion date for the project is December 31, 2005.

September 12, 2003 – Providence Alaska Medical Center (PAMC) submitted an application to modify the certificate of need that was approved in March 2002. The 2002 CON was approved to build a 60– bed psychiatric facility, however 8 beds were to be shelled in until the facility utilization reached 85%. A modification was required because the cost had increased above the acceptable level and the applicant wanted a change in scope – to have the shelled– in space approved for use. The application to modify the certificate of need was approved. The approved configuration of the facility is 8 child and 24 adolescent beds, 10 voluntary adult beds and 18 Designated Evaluation and Treatment beds for a total of 60 beds. Twenty– seven mental health beds will be vacated and can be converted to progressive care or other specialized care beds but not medical/surgical beds. The approved cost of the project is $25,300,000 with a completion date of December 31, 2006.

August 6, 2003 – Renal Care Group Alaska submitted a certificate of need application to develop a 7,200 square foot, 12– station kidney dialysis facility in to be built at 3787 East Meridian Loop Road , Wasilla. The application was approved as requested and RCGA is authorized to expend up to $1,258,085 for construction of the facility that will be completed by December 31, 2005 .

March 26 – Wildflower Court ( Juneau ) submitted a plan to implement the certificate of need approved on December 31, 2002 . The original application was to convert 11 assisted living beds to nursing home beds was denied, however, Wildflower Court was allowed to build a 6– bed nursing wing on the Southeast side of the facility. The total approved project cost was $863,550 with a completion date of June 30, 2005 . Wildflower Court will have a total bed complement of 50 nursing home beds and 10 assisted living beds for a total of 60 beds when the project is completed. On February 6, 2003 the facility was approved to allow temporary use of 5 existing assisted living beds for nursing home beds for a maximum time period of nine months during construction of the new wing. On October 21, 2003 , the temporary use of the 5 assisted living beds for nursing home beds was extended for an additional 9 months to August 31, 2004 . The extension (recommended by engineers) will allow foundation construction during the winter when the ground is more stable.

March 24 – Providence Alaska Medical Center submitted a certificate of need application to modify the 60– bed psych CON approved in 2002. The application was declared complete on April 28, submitted to the Commissioner on July 25 and approved as requested on September 12, 2003 . The original application was to build a $21 million 52– bed freestanding acute inpatient psychiatric facility with 18 adult DET beds, 10 adult voluntary beds, 16 adolescent beds, and 8 children's beds; and a shelled– in space for 8 beds to be finished off when existing adolescent beds maintain an average 85% occupancy rate for 2 years. The vacated psych space in the existing facility was approved for conversion to 27 acute care beds. The modification is required because the applicant wants to use the 8– bed shelled in space and the cost has increased to $25.3 million, which exceeds the 15% plus inflation that is allowed.

Jan. 31, 2003 – The Providence Alaska Medical Center certificate of need application to and add 19 acute care beds in space above the Emergency Department was approved. Conditions of approval for the expansion are that the applicant can build out 18,000 sq. ft. of shelled– in space above the Emergency Department to expand the ICU and install 20 ICU beds, build a closed walkway from the existing ICU to the North Tower, eliminate 1 existing ICU bed to accommodate the walkway entrance, remodel the existing ICU, and convert 9– beds to a Medical Unit overflow area. A total of 19 new beds including 10 new ICU beds for a total of 28 ICU beds, and 9 new Medical Unit beds for a total of 55 Medical Unit beds are approved. The facility will have a grand total of 326 acute care beds. The approved cost of the project is $11,300,000 with a completion date of December 31, 2004 .

Progress Reports:

10/30/2003 – Fairbanks Memorial Hospital – The construction has begun and the exterior is substantially complete on the expansion and relocation of the Clinical Laboratory. The total project is approximately 70% complete and approximately $8.7 million has been expended. A modification of the CON is expected since the applicant desires to change the scope of the project and expand radiology.

11/4/2003 – Valdez Hospital – Construction of a replacement hospital started on April 15, 2003 and is approximately 65% complete. Work on the underground utilities, foundation and footings, and roof is complete. Windows and aluminum panel siding is being installed and rough carpentry, plumbing, electrical and HVAC work is proceeding inside the building. The project is not fully obligated, but a guaranteed maximum price for building construction of $21,313,810 has been executed with JE Dunn Construction. The project on schedule and should easily be able to be completed by the CON approved date of December 2008. Occupancy of the new facility is expected to take place in October 2004.

Letters of Intent:

December 14 – Providence Alaska Medical Center submitted a letter of intent to purchase a CT Scanner at a total project cost of $1,120,000 to replacement an existing unit. A determination was made that this project is considered a routine replacement under 7 AAC 07.130(3) and a certificate of need application is not required because the existing CT scanner is 9 years old, is fully depreciated out, and has exceeded its useful life (considered to be 5 years), the old CT scanner will be dismantled and disposed of by the manufacturer; and new equipment improves quality of service but does not provide a new or different type of service from that already offered.

December 14 – Ketchikan General Hospital submitted a letter of intent to install a Siemens SOMATOM Sensation 10 Computed Tomography (CT) Scanner System to replace the existing CT scanner at a cost of $1,035,916. This project does not require a certificate of need because it is considered a routine replacement because the existing scanner is fully depreciated out, has exceeded AHA guidelines for the estimated useful life (5 years), and the old scanner will be traded in on the new equipment.

December 9 – Providence Alaska Medical Center submitted a letter of intent to purchase a Varian 21 EX linear accelerator to replace the existing Varian Clinac 6/100 linear accelerator. Although the project will cost an estimated $1,750,000, a determination has been made under 7 AAC 07.130(3) that the project is considered a routine replacement and will not need to go through the certificate of need process because the existing Varian Clinac linear accelerator is 17 years old, is fully depreciated, and has exceeded its useful life – considered to be 7 years according to the “AHA Estimated Useful Lives of Depreciable Hospital Assets – 1998 Edition. This project is not considered an expansion of services, since the old linear accelerator will be dismantled and disposed of by the manufacture. Although the new equipment will significantly improve the quality of cancer treatment by offering state of the art Intensity Modulated Radiotherapy (IMRT), it is not a not a new or different type of service than already offered.

November 25 – Ketchikan General Hospital submitted a letter of intent to renovate the long– term care unit at a cost of $3.2 million. A determination has been made that the renovation of this space will require a certificate of need for the following reasons because the project is for a health care facility that costs over $1 million. A certificate of need application may be submitted between January 25, 2004 and November 26, 2004 .

November 18 – Central Peninsula General Hospital submitted a letter of intent proposing the replacement of the existing MRI. A certificate of need is not required for this project because the cost of the new MRI is $740,903 – which is under the $1 million threshold.

November 14 – MD Incorporated (represented by David Dunn of Lexington , NC ) Submitted a letter of intent for the construction of a $20 million, 100– bed long– term care facility in the Wasilla/Palmer area. A determination was made that this project will require submission of a certificate of need application because it is for a health care facility and the cost is over $1 million. A certificate of need application for this project may be submitted between January 14, 2004 and November 14, 2004 .

November 14 – The Alaska Spine Institute Surgery Center , LLC, submitted a letter of intent for the construction of an ambulatory surgery center located in leased space at the Alaska Pacific University Medical Office and Learning Center at 3801 University Lake Drive , in Anchorage . The 10,206 sq. ft., 4– suite facility will be located on the first floor is expected to be completed by August 2004. It has been determined that this project will not require a certificate of need application because the estimated $855,525 cost of the proposed ASC is under the $1 million threshold that triggers the CON process, and the estimated $737,674 cost of new furniture, fixtures, and equipment is a lease as defined under generally accepted accounting principles (GAAP) FASB 13.

November 6 – Providence Alaska Medical Center submitted letter of intent to purchase a 0.7 Tesla open– architecture Magnetic Resonance Imaging unit. The new equipment and remodeling are expected to cost approximately $3 million. A determination was made that a certificate of need is required for the project because the project cost exceeds the million dollar threshold; and meets the definition of a health care facility. A certificate of need for this project may be submitted at any time between January 5, 2004 and November 6, 2004 .

September 9 – The Alaska Department of Health and Social Services, Division of Administrative Services submitted a letter of intent to convert the existing Palmer Pioneers’ Home to an 82– bed State Veterans Home at a cost of $2.745 million. This project will not require a certificate of need because the beds will not be licensed as nursing home beds, but will be assisted living and under AS 18.07.111(8)(A) an Alaska Pioneer’s Home is not considered a health care facility for the purpose of the certificate of need program.

September 8 – The Geneva Woods Surgical Center submitted a letter of intent to remodel the existing ambulatory surgery center. A certificate of need is not required for the project because the project cost of $100,000 to $200,000 is below the $1 million threshold that triggers a review.

August 4 – Fairbanks Community Mental Health Center Detox and Behavioral Health Team submitted a letter of intent for construction of a 16– bed Detox and Behavioral Health Center costing $3 million. A determination was made that the project will not require a certificate of need because the building is not considered a health care facility as defined by AS 18.07.111(8).

June 17– Central Peninsula General Hospital submitted a letter of intent a $49.9 million hospital expansion project. A determination was been made that a certificate of need is required for this project because the cost is over $1 million and it is for a health care facility. Central Peninsula General Hospital may submit a certificate of need application at any time between August 20, 2003 and June 20, 2004.

April 21 – Maniilaq Medical Center submitted a letter of intent for a 10,842 sq. ft. addition to the hospital that will house a 10– 20 bed nursing home. The total estimated project cost is $8– $10 million and construction is planned for 2004/2005. A letter was sent from the office stating that they could begin the project without a certificate of need Commissioners but that the Department is studying whether these types of facilities need to go through the process.

April 21 – Maniilaq Medical Center submitted a letter of intent for a 10,842 sq. ft. addition to the hospital that will house a 10– 20 bed nursing home. The total estimated project cost is $8– $10 million and construction is planned for 2004/2005. A letter was sent from the Commissioners office stating that they could begin the project without a certificate of need but that the Department is studying whether these types of facilities need to go through the process.

April 16 – Renal Care Group Fairbanks (RCGF) submitted a letter of intent to add 4 stations to the kidney dialysis facility being built in Fairbanks. The estimated cost of the additional stations is $65,904 and will not require any additional space. A modification of the certificate of need is not required for this project because the cost does not exceed the 15% plus inflation allowed (the original cost was $1.7 million); the original CON application and review document both acknowledged the need for additional stations in the future and allowed the project to be designed to meet those need; and there is a cost savings for adding the additional stations rather than adding a new shift .

April 2 – Renal Care Group Alaska submitted a letter of intent to build 17,500 sq. ft.. a 35– station kidney dialysis center at the southwest corner of Tudor Road and Piper Street in Anchorage to replace the existing 15,000 sq. ft. leased facility. The cost of the project is estimated at $2.0 million with a completion date of June 2004. It is determined that a certificate of need is required for this project and an application may be submitted at any time between June 4, 2003 and April 4, 2004.

March 27 – Renal Care Group Alaska (RCGA) submitted a letter of intent for a 9– station, 5,758 sq. ft. kidney dialysis facility in Juneau. The facility will be located in existing space in a site yet to be determined. The total estimated project cost is $1,059,212 ($469,212 for equipment and $590,000 for leasehold improvements, planning, design, administration, and fees). A certificate of need is required for this project because it exceeds the million– dollar threshold and the project is covered by CON. RCGA may submit a certificate of need application for this project at any time between May 27, 2003 and March 27, 2004.

March 26 – Renal Care Group Alaska (RCGA) submitted a letter of intent to build a 12– station, 7,200 sq. ft. kidney dialysis facility in Wasilla. The building will be built and owned by another party, but built exclusively for RCG. The total cost of the project is $2,910,345 including $1,292,285 for equipment, design, and leasehold improvements plus $1,618,060 to lease the facility for 10 years. A determination has been made that a certificate of need is required for this project because it exceeds the million– dollar threshold and is for a project covered by CON. RCG may submit a certificate of need application for this project any time between May 26, 2003 and March 26, 2004.

March 26 – Providence Imaging Center (PIC) submitted a letter of intent to purchase an additional MRI unit (General Electric 3.0 Tesla) at a cost of $2 million. In addition, new space will be added to house the MRI in the Radiology Department on the west side of the hospital. Construction costs for housing the equipment are $500,000 bringing the total to $2.5 million. The MRI will be located adjacent to the inpatient elevators, operating rooms and Heart Center. It was determined that a CON is not required because the facility is not a health care facility as defined by certificate of need regulations.

February 20 – Alaska Regional Hospital submitted a letter of intent to replace the existing Interventional Cath Lab. A determination was made that the existing equipment is approximately 10 years old, is losing stability, replacement parts are hard to find, and the Lab will be junked after new equipment is installed. Therefore this project is considered a routine replacement under 7 AAC 07.130, and a certificate of need is not required. The estimated project cost is $1.8 million with a planned completion date of May 2003.

February 20 – Valley Hospital submitted a letter of intent to add 1 additional Medical/ Surgical room with 1 bed. A certificate of need is not required for this project because the $28,915 cost is under the $1 million threshold. Valley Hospital will have a total of 40 acute care beds when the project is expected to be complete on March 28, 2003.

January 28 – Valley Hospital submitted a letter of intent to build a 75– bed hospital in Wasilla at a projected cost of $75 million. A certificate of need is required for this project because it is for a health care facility and costs over $1 million. Project construction is projected to begin in May 2003 if the project is approved. A certificate of need application may be submitted at any time between March 29, 2003 and January 29, 2004.

January 22 – Providence Alaska Medical Center submitted a letter of intent to modify the certificate of need a 60– bed Psych facility that was approved in 2002. The modification is similar to the prior application, however, the project completion date is extended until December 2006; the cost has increased by $4.3 million; and the bed complement will be 60 beds total with 8 child beds, 24 adolescent beds, 10 adult voluntary beds and 18 DET beds. The only bed change is that 8 adolescent beds that were to be shelled in until an 80% use rate had been reached will be into operation immediately. A determination was made that the project will require modification of the CON because of changes in completion date, the scope, and the cost is over 15% plus inflation. An application to modify the certificate of need may be submitted any time between January 25, 2003 and January 24, 2004.

January 3 – South Peninsula Hospital submitted a letter of intent to modify the certificate of need approved in 1998. A new master plan has been developed that will cost $16 million and will require 3 additional years to complete. An application may be submitted at any time between April 1, 2003 and January 2, 2004.

Appeals:

January 2 – Providence has agreed to hold the appeal of the NorthStar decision in abeyance at the current time.

 

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