The Cook County Board voted 14-2 Monday to build a new County Hospital, despite opposition from one board member who estimated that the plan could cost as much as $1.2 billion when interest and other financing costs are included.
The board authorized McDonough & Associates, a consulting firm at 224 S. Michigan Ave., to propose a specific site near the current 1,018-bed structure at 1825 W. Harrison St.
The firm also is to recommend specific designs for the new hospital, which will have between 696 and 866 beds as well as a new outpatient facility, employee and visitor parking areas and new equipment.
Board member Joseph Mathewson (R., Winnetka), who along with Richard Siebel (R., Northbrook) voted against the new hospital, said the construction cost, estimated at $573.5 million, would be topped by as much as $680 million in fees and interest costs on a bond issue that will be used to finance the building.
Financial experts generally agreed with Mathewson`s calculations but pointed out that the cost of a public works project is usually expressed in the amount of bonds that must be sold to build a facility, not how much is paid to service those bonds over, say, 20 years. As with a private home mortgage, the amount paid toward principal and interest over a 20-year period is often twice the amount borrowed, or more, depending on interest rates.
For instance, if a government sells $500 million worth of 20-year general obligation bonds at 8 percent, taxpayers will end up paying more than $1 billion before the bond is fully retired.
James McDonough, head of the consulting firm, said construction could start next spring and is expected to take at least five years. McDonough`s firm would get a $4.7 million contract to oversee planning for the structure. McDonough said last week that he expects to report to the county board in about 90 days on his initial recommendations for site selection and building designs.
Mathewson and Siebel opposed the plan, saying the board had only a few days to study the project. They also said the analysis prepared by hospital director Terrence Hansen to justify a new hospital did not include enough information on alternatives. These include greater use of purchase-of-service agreements with other hospitals and the acquisition of private hospitals such as Provident on the South Side and at least part of the University of Illinois Hospital, which is near County Hospital.
County Board President George Dunne said there is a need to expand services offered by the hospital and that further discussions would be pursued with Provident, the U. of I. Medical Center and eight city-owned and operated neighborhood health clinics.
Dunne has said that he would be in favor of the county board taking over Provident only if the board and taxpayers are not stuck with the $40 million in debt the South Side hospital has incurred in recent years.
”The entire report (presented last Thursday by Hansen) is tilted toward justifying its recommendations for a new Cook County Hospital,” Mathewson said. ”What we should justify here is adequate and indeed improved health care for the medically indigent of Cook County.”
Siebel said the proposal ”flies in the face of medical experience over the past 10 years because inpatient service is way down and people are using outpatient services more. This is a waste of taxpayers` dollars.”
But board member Samuel Vaughan (D., Chicago), chairman of the board`s Health and Hospitals Committee, said the proposal can be adjusted to accommodate trends toward less inpatient care and more outpatient treatment.
”The time has come to finally get off dead center,” Vaughan said. ”All we`re saying is that we need to build a new hospital. Just because patients are medically indigent doesn`t mean they should continue to be treated in an archaic building.”
The current hospital was built in 1910.
Board member Irene Hernandez (D., Chicago) told Mathewson that ”if we took the time to do what you want to do, we would not be doing our duty; we have to take care of the medically indigent, and this is a good start.”
Commissioner Bobbie Steele (D., Chicago) called on the board to ”stop talking and let`s start doing something. The time has come to take the awesome step of building a new hospital.”
Board member Frank Damato (D., Chicago) said the decision was ”probably one of the most important things we will ever decide. I don`t think it is political. It doesn`t make any difference whether we are Republicans or Democrats. We all want to get the best facility we can for the taxpayers.”
Board member Jerry Butler (D., Chicago) said opponents of a new hospital focused on the amount of money that will be spent on a new building rather than on the amount that will be saved.
”We probably have wasted enough money (on renovations at the existing structure) to build a new hospital,” he said. ”I hear people talking about the money that will be wasted, but I don`t hear them talking about the money that will be saved.”
Board member John Stroger (D., Chicago), chairman of the Finance Committee, said the Joint Commission on the Accreditation of Hospitals
”probably would not have accredited us with this old building if it weren`t for the fact that we have treated the medically indigent.”
”The building is costing taxpayers an astronomical amount of money in terms of maintenance, personnel needed to move patients around an antiquated building and capital improvements,” he said. ”We also have to take into account the amount of money we have to spend on utility bills. We cannot continue to spend money as we do on an old building.”
In addition to the fact that the structure is deteriorating, much of its medical equipment is old.
Hansen has estimated it would cost $20 million just to turn the existing hospital into a ”technologically current institution.”
Four Republicans joined 10 Democrats in voting for the new hospital. Mary McDonald (R., Lincolnwood) was absent.
