University Health makes plans to build two new hospitals

The Bexar County Hospital District’s board of managers on Tuesday unanimously approved plans to build two new hospitals in medically underserved areas — one on the Southwest Side near Texas A&M University-San Antonio and one on the Northeast Side at Retama.

Each new hospital campus will offer 140 beds across four floors, with room to expand the buildings upward and outward. They will provide general medicine, obstetrics, general surgery, cardiac and orthopedic services.

Designs for the buildings are expected to take a year, University Health President and CEO George Hernandez said. The Retama hospital could open as soon as 2026 and the Texas A&M hospital as soon as 2027.

Plans for a South Side hospital were particularly welcomed by University Health board member Pat Jasso, who was appointed to the seven-member board in February by Commissioner Rebeca Clay-Flores. The commissioner asked Jasso to advocate for increased medical resources in Precinct 1, which spans the west and south portions of the county.

“It’s just so needed,” Jasso said after the meeting. “We really need more hospital beds on the South Side, so I know this is going to be successful.”

A recent Express-News investigation on health inequities found that medical facilities in San Antonio are heavily concentrated in the northern parts of the city, placed in areas where patients generally are healthier and more affluent and where providers can collect higher reimbursements from insurance companies.

In the southern part of the city, options for hospitals, medical specialists and surgical centers are limited.

Throughout the COVID-19 pandemic, infections have been much more prevalent and more deadly for people living in these areas on the South Side, where the population is 81 percent Hispanic.

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“We’ve always stood for access to care. It’s been a core value for us,” Hernandez said. “We only have one hospital for a very huge network.”

The total cost for both proposed hospital projects is estimated at $950 million, to be funded with $450 million in cash reserves and $500 million in tax-exempt municipal bonds.

Hospital officials said there will be no increase in property taxes.

Chief Financial Officer Reed Hurley said the Retama hospital will likely “break even” after two years, while the Southwest Side hospital would take longer to operate without a loss based on the mix of health insurance coverage that residents have in those areas.

More than 21 percent of patients in the southern region are unfunded, which means they neither have commercial insurance nor are covered by Medicaid or Medicare.

Still, Hernandez said the upfront investment will pay off in the long run and assured board members that University Health leaders are prepared to handle the system’s expansion.

Chief Operating Officer Ed Banos said they project that both hospitals will be profitable for the system because being able to treat patients on the South Side closer to where they live will relieve pressure on the main hospital campus, making room there for more complex medical cases.

The two smaller community hospitals will operate under an open staff model, while the main hospital will rely on hiring its own medical staff and its academic partnership with UT Health San Antonio.

Robert Hromas, dean at the Long School of Medicine and the vice president for medical affairs at the health science center, said it strongly supports plans to open two new hospitals.

“I wish we would’ve done this three years ago,” he said. “We desperately need more beds.”

The 12-story Women’s and Children’s Hospital, which is set to open next summer, will enable the system to accommodate more patient volume, but it’s not enough to keep up with population growth in the county.

Hospital officials presented plans to expand acute care bed capacity in response to rapid growth as projections show that by 2030, Bexar County’s population will increase by 28 percent to 2.5 million.

As it is, University Hospital is treating adult patients across three older buildings. They opened six beds adjacent to the pediatric emergency room, and those have remained full since they opened.

The system also recently bought a minority share of PAM Health’s Warm Springs Inpatient Rehabilitation Centers, which enabled 17 rehab beds to be converted to medical-surgical acute beds. Those, too, are full.

“There are no more options,” Banos said. “The beds that could be converted (to make room) have been.”

The board approved the recommendation to seek approval from Bexar County commissioners at their next meeting to issue certificates of obligation for the proposed project.

By law, the county must notify taxpayers of the proposed issuance of bonds and must allow 45 days before proceeding with the bond sale.

University Health has been eyeing expansion in other parts of Bexar County. In 2020, it bought an 80-acre tract on the far West Side near Loop 1604 and Shaenfield Road with the intention of eventually building a community hospital; however, this site is not included in the capital improvement program approved Tuesday.

[This article was originally published by San Antonio Express-News.]

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