Kaleida Health plans to break ground this summer on the new John R. Oishei Children’s Hospital after making significant progress in recent months on winning required approvals and raising money for the $270 million project on the Buffalo Niagara Medical Campus.
The new timeline for the 400,000-square-foot hospital, which will take 30 months to build, alters an optimistic initial schedule that predicted construction would begin last spring and wrap up next year.
But Kaleida Health has pushed forward on a new Children’s Hospital even after ousting its CEO in January and reporting a financial loss for 2013. And system officials Thursday reinforced their commitment to the project and outlined the steps they’ve taken to bring the hospital closer to reality.
“It’s at the top of the priority list,” CEO Jody L. Lomeo said in an interview. “It’s a community asset. As far as our portfolio goes, there’s been no pause at all in the significance and importance of Children’s Hospital.”
Kaleida Health intends to build a 12-floor, freestanding hospital, with 185 beds, at Ellicott and High streets. The new facility replaces the longtime Women & Children’s Hospital of Buffalo on Bryant Street in the Elmwood Village.
The system unveiled its plans in 2011 and 2012, beginning an extensive government review and fundraising process. Since then, Kaleida Health has:
• Undergone an upheaval in its executive ranks, which saw Lomeo replace James R. Kaskie, first on an interim basis and then as permanent CEO. Lomeo and Kaleida Health board Chairman John R. Koelmel had reiterated their support for a new Children’s Hospital, even as the system reported a loss last year of $15.3 million on $1.26 billion in revenue.
• Raised $38 million of the $42 million sought in a capital campaign, and a further $2.5 million to create endowments for family support programs at the hospital. That includes $10 million from the Oishei Foundation, $5 million from businessman Sal H. Alfiero, $3 million from toy makers Fisher-Price and Mattel, and $2 million from the Children’s Guild Foundation.
• Won permission to formally apply for financing through the U.S. Department of Housing and Urban Development, which has loaned money to Kaleida Health for other recent hospital projects. “We’ve been waiting for this – we’ve been anxious to move forward,” said Allegra Jaros, president of Children’s Hospital.
• Held productive discussions with lawmakers in Albany about state support for the new Children’s Hospital. The system in 2012 unsuccessfully sought a $30 million state grant, but officials said Thursday that an announcement of aid from Albany could come this summer.
• Received a required certificate of need from the state Health Department, as well as approval from the City of Buffalo and various boards for the hospital site plan and an environmental review of the project. The city also granted an easement for a walkway across Ellicott Street, connecting the new Children’s Hospital to Buffalo General Medical Center, and completed roadwork that repaved Ellicott and opened the road to two-way traffic.
• Prepared the site, which is now shovel-ready, for the expected groundbreaking in the next few months.
Jaros said employees at Children’s Hospital are excited about the move into the new facility, which is designed to operate more efficiently than the current, aging facility. She said the prospect of a new hospital has helped Children’s recruit new physicians, with the hospital adding 17 doctors last year and 18 already this year.
The new hospital has 15 fewer beds than the existing hospital, a recognition that more procedures are being performed on an outpatient basis and that hospital systems are seeking to avoid unnecessary admissions or readmissions. “That’s a look to the future,” Jaros said. The new Children’s will have amenities such as single rooms in the neonatal intensive care unit, which promise lower risk for infections and shorter stays for the tiny patients, she said.
The hospital will connect to Ciminelli Real Estate’s $110 million Conventus medical office building, now under construction on an adjacent parcel at Main and High streets, which will house Children’s ambulatory services.
Early projections had the hospital costing an estimated $240 million, but Kaleida Health now has a firmer expected price of $270 million. That updated figure includes building out a 12th floor in a joint venture with Roswell Park Cancer Institute to provide care in one location for children with cancer and blood diseases.
Kaleida Health has begun strategic planning for the future of its current Children’s Hospital, but system officials don’t expect to take any formal steps toward settling the fate of that facility until construction on its replacement moves further along.
“There is significant interest from local and national developers in the site,” said spokesman Michael P. Hughes.