The $20 million, 236 bed Greater Laurel-Beltsville Hospital will not even open its doors to patients until May 1. But already the experts are saying it is in financial trouble.
As a result, it may have to charge patients unusually high rates in its first year, futher aggravating the problem of rapidly rising medicla costs here, and it may still run a $1 million deficit that will be billed to the taxpayers to Prince George's County.
It was not supposed to happen this way. When county officials sought state and local government approval for the hospital six years ago, their plans called for first year occupancy rate high enough to break even and charge reasonable rates.
Now, according to state officials who regulate hospital charges, the Greater Laurel facility is projecting first year occupancy of about half the those original estimates and million dollar losses as a result.
The construction and financial problem posed by the hospital, built and operated by the county, provide another insight into the rapidly rising cost of medical care - both locally and nationally. Viewed from the perspective of the entire metropolitan area's needs, the facility may not be needed at all.
But considered from the perspective of persons living in upper Prince George's County, the hospital fills their desire to have a community facility for their medical and surgical care.
Yet the fact remains that Prince George's County residents who use the new hospital will pay higher costs in two ways - in higher rates and through their county government's subsidy if the projected loss does occur.
Walter J. Berry, comptroller of the Prince George's County Hospital Commission, said it was "inconceivable" that Greater Laurel-Beltsville will lose as much money the first year as the Maryland Health Services Cost Review Commission - the regulatory agency - said. "We would have to have a tremendous underestimate in order to lost $1 million," Berry said.
But Hal Cohen, director of the state commission, confirmed that his staff's analysis projects the $1 million loss. According to Dennis Phelps, the state commission rate analyst who prepared the study, Greater-Laurel will be permitted to charged about $131 a day as the basic room charge for medical-surgical beds, which account for the majority of beds in the new facility.
Prince George's General Hospital, the county's other major facility, its permitted to charge about $90 a day for medical surgical beds.
The higher rate was permitted for Greater Laurel because the occupancy rates projected "are so low," Phelps said. The hospital would have had even higher rates if state commission officials had permitted it to recover more of the first-year portion of construction costs that must be paid.
The state rate commission, according to Cohen and Phelps, was confronted with a dilemma: To set rates high enough to allow the hospital to break even despite the low occupancy or to set rates more in line with what other area hospitals charge and have the hospital lose money. The commission chose to set lower rates.
The Washington metropolitan area already has a costly oversupply of hospital beds, and an excess supply of staff to serve them, and in the opinion of many health planning and insurance officials. The overall occupancy rate for the metropolitan area in 1977 was about 81 percent, according to data gathered by the Hospital Council for the National Capital Area. An occupancy rate of about 85 percent is generally considered to be optimal.
In some areas, like pediatric and newborn beds, the areawide occupancy rates are 55 to 60 percent. The Southern Maryland Health Systems Agency, the agency required under federal law to prepare a health plan for Prince George's and the three other Southern Maryland counties, recommends in its draft plan that the 36 projected obstetric and gynecological beds at Greater Laurel-Beltsville "should not be opened." Present hospital plans do not call for the obstetric beds to be opened the first year. Another 16 psychiatric beds also will not be opened.
When county officials first sought approval to build the hospital six years ago, they said Greater Laurel-Beltsville would finish the first year with 85 percent of its bed filled.
At the time the planning process was less defined and less rigorous than it has become with a tightening of requirements by the federal government.
After discussions with state commission officials, the official projection for the end of the first year was reduced to about 70 percent.
Now, however, state commission officials say the hospital will be about 43 percent occupied by the end of the first year. William A. Parker, director of hospitals for Prince George's, said that Greater Laurel-Beltsville will have an occupancy rate of 78 percent, based on the 178 beds that will be opened by the end of the first year.
But Cohen and Phelps both asserted that the only proper way to calculate the hospital's occupancy rate was to figure the full number of beds it had, not how many were opened. "They could open 20 beds, fill them and claim 100 percent occupancy," Phelps said.
"They're opening fairly slowly. By the end of the first year, they won't have all their medical-surgical beds open - which is fairly unusual."
Parker said he thought the occupancy figures given to the state commissioner were conservative and that the new facility would be fuller than projected.
His comments reflected the initial community demands that helped get the hospital built. "Money is not the only factor," he said. "We're looking for quality."
Only 40 per cent of the county's residents can not use hospitals within the county with the rest going to hospitals outside, he said.
"The people of Northern Virginia built many fine hospitals so they wouldn't have to depend on the District of Columbia. In my opinion, Maryland should do the same thing."
For that reason, Parker said, he also supported the construction of yet another hospital in the county: a proposed 176 bed community hospital in Bowie, which would cost an estimated $16 million to build.