Building Hope

Phoenix Children’s Hospital expansion will try to meet critical health care needs

By Janet Perez

With the Valley falling short of health care resources such as doctors, nurses and facilities, Phoenix Children’s Hospital has an eye toward future needs as it launches its $588 million expansion. When Phase I of the expansion, which broke ground in May, is completed in 2012, the number of beds at Phoenix Children’s Hospital will grow from 299 to 632.

Those beds will be critical as officials at Phoenix Children’s estimate that by 2030, the number of children in metro Phoenix is projected to increase to more than 1.5 million, compared to 900,000 today. “There is a bed shortage in pediatrics in the Valley, as signified by things that are going on today, where we are basically running full all of the time. We turned away 1,700 children in 2007, so if you look at an admission base of 12,000, it’s 15 percent that are being turned away,” says Robert Meyer, president and CEO of Phoenix Children’s Hospital. “We already have a crisis. And if you look at the physician side, there are backlogs for many specialties. There are four to six weeks before you can get a new appointment. We have been working to reduce those backlogs. So in response to all of those issues, we are making an expansion of the bricks and mortar, which is the hospital beds themselves. We are also doing a geographic expansion to make ourselves more accessible and to get the specialists themselves — not primary care physicians — but specialists out into the community.”

Along with the expansion, Phoenix Children’s is also busy building a series of ambulatory centers around the Valley, the first of which opened in the East Valley in December at Southern Avenue and Higley Road. The second is set for Avondale and McDowell roads and should be open early in 2009. Another center is set for the Northwest Valley, along with one that already is up and running at Scottsdale Road and Shea Boulevard.

But the main building effort is taking place on Phoenix Children’s Thomas Road campus. Currently, the hospital is in a cramped location in a landlocked area of Phoenix. Meyer says hospital leadership looked at whether it should buy land in the suburbs and build a new campus altogether before opting to stay put.

“We vetted all those options out and came back to the idea that we really needed to stay basically where we are for a number of reasons,” he says. “One is freeway access and a central location to the Valley. Because we are a high end, tertiary referral center, access and a good central location are important. So literally, getting off the 51 freeway, you’re on our campus.”

For the expansion, property adjacent to the Thomas location was acquired, increasing the size of the campus from 19 acres to more than 34 acres. Phase I improvements include:
• A central plant.
• A 750-car employee-parking garage.
• A new, on-campus Ronald McDonald House.
• A new hospital featuring an 11-story patient tower and outpatient clinic space.
• A new main entry boulevard off Thomas Road.

Dave Cottle, executive director of planning, construction and design for Phoenix Children’s, says there may be a need for a Phase II expansion in the future, but in the meantime, half of the 10th and all of the 11th floor in the new tower will be shelled but not finished in anticipation of a demand for more beds.

“If our bed need increases right away, we can simply finish it off,” Cottle says. “We won’t have to bring the cranes back. We’ll be ready to go. So you build a little flexibility into your projects and that’s what we’ve done.”

The new tower will keep in place such Phoenix Children’s Hospital hallmarks as the bright color palette.

“Colors are everything for kids. You don’t see very many adult hospitals that use bright colors. It works well on kids, where it doesn’t on adults,” Cottle says. “Our artwork is different. It’s very playful versus serious. We have special committees that are going to help us with our artwork, with community input. We are going to have themes in our hospital that have to do with animals.”

Besides the children, construction of the new tower is taking into consideration the young patients’ families as well.

“This is family-centered care, so we not only look at the sick children, we really take care of the parents and give them a space to sleep in the privates rooms, we get them wireless connection to the Internet and easy access down to the cafeteria,” Cottle says.

Kitchell is constructing the new additions and the architectural firm HKS is handling the interior design.

Although the expansion comes with a more than half-a-billion dollar price tag, the current economic slump has not derailed plans, Meyer says.

“All the financing related to debt instruments for the new hospital was done in early ’07, so we avoided all those issues, and we structured it in a way that we are not affected by the current credit crunch in any way,” he says. “In terms of donations, yes, it will be much harder to raise money in this environment than it was two to three years ago. That said, in the longer-term perspective, we’re looking at a capital campaign of about $100 million to $105 million to support the expansion project over the next five to six years. Which again, is well within the capacity of this community to do.”

In fact, Cottle says, the economic malaise has actually helped the expansion, because with the residential building industry at a near standstill, construction workers are now more readily available. The cost of materials is also declining.

“Our hospital will be a steel building. Steel has gone down somewhat over the past few months because of the market,” Cottle says. “So we are enjoying good pricing on steel for instance. Of course, we’re not into the copper, the wiring and such, so we are keeping an eye on that as well. Some of those materials you can pre-purchase to keep the costs down.”

Besides the physical improvements to Phoenix Children’s Hospital, the expansion will help the facility maintain its ability to attract new talent. Since taking the helm at Phoenix Children’s in 2003, Meyer says the hospital’s medical group has gone from 46 physicians to 155, many of them specialists in such areas as juvenile rheumatology. In addition, the hospital has opened the state’s only pediatric kidney dialysis unit, and is the only place in Arizona children can go for bone marrow transplants.

The expansion is expected to be a boon to the local economy as well. Phoenix Children’s estimates that the expansion will add 1,800 to 2,000 new jobs to the Valley, in addition to the current annual employee payroll of $164 million and an estimated $11.5 million in uncompensated carelast year.July Cover 2008

Phoenix Mayor Phil Gordon says the hospital’s expansion also fits in with his vision of making the city a center of science, medicine and research. But it’s the intangibles that he finds even more rewarding for the community.

“It represents hope for a lot of people that are going through some of the most difficult and horrifying experiences they will ever face,” he says. “The hospital and its employees really represent this spirit of, what I define, as a city with heart and soul. You can just look at how dedicated the doctors are and the nurses are. I’m grateful to them being an asset to the community.”

AZ Business Magazine July 2008 |