New hospital debuts in Maple Grove; patients wanted

The construction crews have gone. Balloons and bouquets dot the lobby, and fish swim placidly in an aquarium near the lounge.

Now the Twin Cities' newest hospital just needs some patients.

Maple Grove Hospital, which opens Dec. 30, was conceived at a time when health care was booming, and it spurred fierce jockeying among hospital groups for the right to build the metro area's first new hospital in a decade.

Then the recession hit. Almost every big hospital group in the Twin Cities lost money last year. Now some are wondering if the new facility can drum up enough patients, and some rivals are telling doctors not to send patients to the new competitor.

The hospital's executives prefer to look on the bright side. The economy "is obviously a concern," said chief executive Andrew Cochrane. "But this is about serving the community."

Industry observers note that hospital owners take the long view.

"A hospital is an investment for 60 years or more," said Allan Baumgarten, an independent Twin Cities health care analyst. "The owners of Maple Grove are in this for the long run, even if the first few years are rocky."

But in 2005 the Minnesota Department of Health determined that the fast-growing northwest suburbs needed a new hospital.

That triggered a three-way fight among North Memorial Health Care, Fairview Health Services and a consortium called Tri-Care -- made up of Allina Hospitals and Clinics, Park Nicollet Health Services and Children's Hospitals and Clinics of Minnesota -- for the right to build the new facility.

In the end, North Memorial and Fairview teamed up and won the Legislature's blessing. The new hospital is 75 percent owned by North Memorial and 25 percent by Fairview.

It's no wonder medical providers saw an attractive market in Maple Grove. From 2000 to 2008 its population grew 24 percent, to 62,000. The median age is 36, and the median household income is $99,000.

But the recession changed the outlook. In the past year many Minnesotans who lost their jobs and their health insurance, or who just had high insurance deductibles, put off doctor visits or elective procedures. Those who saw the doctor didn't always pay.

Twin Cities hospitals lost millions of dollars last year, and cut hundreds of jobs to compensate. In a sign of the times, 8,500 people applied for 175 jobs at the Maple Grove Hospital.

There are other clouds on the horizon. Pending legislation in Congress could expand the number of people with health insurance but cut reimbursements to hospitals. All of that adds to the pressure to operate efficiently, Cochrane said.

As a result, the hospital is opening in stages. Though it was built for 90 beds, it is opening with just 30. Just three of its five operating rooms have been equipped so far. It will not directly employ doctors; they will come from Fairview, North Memorial and independent physician groups. "The task at hand is to match staffing with demand," Cochrane said.

Earlier this decade, hospitals proudly showed off new wings decked in marble tile and waterfalls. Such ostentatiousness is no longer in fashion. Asked about the flat-panel TVs in patient rooms, Cochrane quickly noted that they will show educational health programs, too.

Business, he thinks, will mostly come from good old community medicine -- the emergency room and obstetrics. He expects the hospital to break even in 2 1/2 to three years.

"The value system is different," he said. "If this was Houston, Allina, Fairview and Park Nicollet would all be building hospitals in the same interchange. There'd be far more duplication."

Which was one point of the 1980s moratorium -- to slow the costly "arms race" among medical rivals.

But even here, competition is keener these days. While hospital groups always strove to keep patients within their networks, efforts to stanch what's known in the industry as "leakage" have intensified.

Allina, the Twin Cities' biggest hospital and clinic group, is telling doctors not to use the new hospital, even though Allina has clinics and patients nearby. An Allina patient who wants to give birth at Maple Grove Hospital will have to change doctors, said Allina spokeswoman Gloria O'Connell: "We won't be delivering babies there."

Allina has special reason to worry. Its Mercy Hospital is just 10 miles away in Coon Rapids. "We probably will see a slight decline in volume," O'Connell said. "Still, we think it will be a minimal impact."

Face paint and photos

Ultimately, Cochrane predicts, the holdouts may have to use the new hospital because their patients will demand it. He may be right.

On Saturday, nearly 6,000 visitors showed up for an open house at the new facility. People milled around the lobby clutching gift bags and chatting with Cochrane as the Maple Grove High School jazz band played. Kids got their faces painted. Outside, families posed for photos in front of a North Memorial helicopter.

Todd and Christine Nelson of Ramsey were in a long line waiting to tour the birth center and surgical area. Christine is expecting her first baby in April. She says she changed obstetricians so she could deliver at Maple Grove.

John and Gayle Barnes, both in their 60s, live nearby and already have had preventive screenings at the adjacent medical building. "We got a thank you note from the nurses," Gayle Barnes said, her voice dropping to a whisper of wonderment.

"It's been a slow start," Doorenbos said. "We're hopeful that with the hospital opening, things will improve."

Chen May Yee • 612-673-7434