A well-known D.C. developer and two associates are trying to win approval for a proposed $47 million, 320-bed rehabilitation hospital on the site of the old Children's Hospital, but some city health professionals think the project is too expensive and excessively large for a city the size of Washington.
Developer Jeffrey N. Cohen has joined with Washington lawyer Samuel C. Jackson and architect Theodore Mariani as joint owners of the proposed National Rehabilitation Hospital, which would be one of the largest facilities in the country devoted exclusively to rehabilitating the physically disabled.
The trio already has won D.C. City Council approval for a $7 million federal grant application to help finance the project. But the proposal also must be approved by the State Health Planning and Development Agency, which oversees construction of new health facilities here, and by the federal Department of Housing and Urban Development, which must act on the grant request.
Approval of the project would give the Washington metropolitan area its first rehabilitation hospital, although several other area hospitals now provide some rehabilitation services. Jackson said the developers hope to jopen the hospital in 1984.
D.C. officials have been looking for a development project for the old Children's Hospital site, bounded by 12th, 13th, V and W streets NW, as part of an effort to revitalize the entire Shaw neighborhood. Since Children's Hospital moved to its new Northwest Washington location in 1977, the abandoned buildings have deteriorated, and nearby residents complain that the neighborhood has become the scene of heavy drug trafficking.
Some city health professionals think the project's owners have left too many questions unanswered. Some said that the project is being rushed toward approval without close scrutiny of whether it is economically feasible. They voiced the fear that the city's taxpayers eventually could get stuck with a four-acre white elephant if the project falters.
Under the complicated financial arrangement of the project, Cohen bought the land from Children's Hospital in June for $4 million. If everything is approved, the city then will buy the land from Cohen for the same amount and deed it to a community group. That group then would lease the land back to Cohen and his associates on a long-term basis, starting at $229,800 a year for the first five years.
Out of the $7 million federal grant money, $3.8 million would be used by the city to buy the land from Cohen, and the rest would be used by Cohen to finance a small part of the construction costs. The remaining $39.4 million of the project would be privately financed, according to the developers. They estimate that the facility would hire about 1,000 people and provide the city with $1.25 million in annual tax revenues.
"Who gets left holding the bag if this project turns out not to be feasible?" asked Gottlieb Simon, a consumer member of the Statwide Health Coordinating Council, which will make an initial recommendation on the project to the State Health Planning and Development Agency.
Simon questioned whether the three principles in the project have sufficient experience in health care to operate the facility and noted that the project drew a critical review from the Blue Cross/Blue Shield insurance firm and from the staff of his own coordinating council.
Randall Rolfe, president and chief executive officer of Capitol Hill Hospital, said, "While we do not oppose the project, it appears that 320 new rehabilitation beds is very extensive." He said that some area hospitals are concerned that the opening of a new 320-bed facility also would drain away badly needed nurses and medical technicians from their facilities at a time when the city already is facing a drastic shortage of health care professionals.
Rolfe also said there is a fear that if the rehabilitation hospital falters, the owners could come back in a few years and apply to covert it into a regular hospital, which would add to the glut of beds in a city that already has 14 hospitals.
Jackson also said that by the time all 320 beds are in use in 1989, the hospital would not be the largest in the country, since several existing facilities -- in California, Texas, New Orleans and other places -- will have expanded by then.