Eureka Springs Hospital has the option to build a new facility in Holiday Island, where developer Tom Dees has offered to donate land if the hospital's plans to build in Eureka Springs fall through.
Allegiance Health Management, the company that operates the hospital, has a contract on 128 acres on the west side of Eureka Springs but has said the city must cover the cost of extending sewer lines to the location, a project that city officials have been uncertain they can afford.
Land in Holiday Island would come with sewer and water ready to go, Dees said. He wasn't willing to give the exact acreage he is willing to donate but said there is plenty of space for the hospital and parking lots. He said there also is room for physician clinics to open near the hospital.
"They have been trying for 20 years to get a new hospital," Dees said about Eureka Springs. "But if it doesn't work out, we have all the utilities and everything here."
Eureka Springs has contracted with an engineering firm to estimate the cost of extending lines to the proposed hospital site off of U.S. 62, adjacent to the Razorback Gift Shop. The closest sewer line is about 2 miles away, at Pivot Rock Road.
Eureka Springs Mayor Morris Pate said a cost survey from 2008 estimates it could cost $1.2 million to extend the sewer line to the property. He estimated it could now cost as much as $2.5 million. He said the city would have to take out bonds or put a sales tax increase to voters to cover the cost.
Dees said costs can quickly add up when extending sewer lines in areas with solid rock, such as the site proposed by Eureka Springs Hospital officials.
"I have been doing it for 30 years out here," Dees said. "I know what they are going to have to do. You don't know what is below the surface. All you have is the best estimate."
Holiday Island, a retirement community about 5 miles northeast of Eureka Springs, also sits on rock, Dees said. He pointed to boulders, on Thursday, that sit along winding roads in the community. He said the chunks of rocks were blasted out with dynamite to install sewers in the community.
Water and sewer lines were extended to the 5,000 lots located in the community prior to development, Dees said.
"When you start sawing, drilling or blasting, it can disrupt tree foliage and foundations of nearby houses," Dees said.
Dees said it would be easier for the hospital to build on land he is willing to donate that already has connections to water and sewer. The land sits nestled between a community park and a fire station. It has Arkansas 23 frontage and is a simple walk to two medical clinics equaling about 20,000 square feet. A helicopter pad sits between the clinics.
Andy Langston is an optometrist at Holiday Island Eye Clinic, which sits near the land.
"There is always a nucleus of doctors that form around a hospital," Langston said. "I think it would be great for the community."
The community of about 3,000 is about 60 percent retirees, Dees said. He said that as they age and need more medical services, they tend to move closer to hospitals.
"We are trying to build a town and all towns need medical facilities," Dees said. "The hospital means more people will live here and stay here."
Dees said more people will move east as larger cities like Bentonville, Rogers, Springdale and Fayetteville continue to grow. He said he wants to be ready for that growth.
The hospital would serve the same people if it moved to Holiday Island, Dees said. He said it could maybe even serve more by drawing on a Missouri population.
"I haven't heard one negative comment," Dees said. "What could be negative about this?"
The only problem could be a hospital permit held by the city of Eureka Springs, Dees said.
Michael Merry, chairman of the Eureka Springs Hospital Commission, said that the city has a license to operate a Critical Access Hospital through Medicare. The permit is leased to Allegiance. He said there is an agreement that if the hospital builds a new facility, the lease will be handed over to Allegiance.
It is unknown if the license could be used to open a hospital in a different city, Merry said.
"There could be some manipulation that we can work on with it," Merry said. "It has been my assumption all along that that we needed to keep it in the city of Eureka Springs.
Merry said he has not researched the option. He said the first option is to see if a sewer line can be extended to the proposed site on U.S. 62.
"I think that as long as the City Council believes they can build that sewer line, they are going to want to keep the hospital here," Merry said. "The hospital, outside of the school district, is the largest employer within the city. My personal feeling is that letting it leave the city would be a mistake."Rural hospitals that receive Critical Access status, such as in Eureka Springs, receive reimbursement payments of 101 percent from Medicare.
Chris Bariola, hospital chief executive officer, previously has said the hospital could not sustain itself on any other payment models offered by Medicare.
He was unavailable for commentThursday.
Hospital
Merry said he has not researched the option. He said the first option is to see if a sewer line can be extended to the proposed site on U.S. 62.
"I think that as long as the City Council believes they can build that sewer line, they are going to want to keep the hospital here," Merry said. "The hospital, outside of the school district, is the largest employer within the city. My personal feeling is that letting it leave the city would be a mistake."
Critical Access Hospitals must be at least 15 miles from other Critical Access Hospitals, Bariola has said. He said that is why land was contracted on the west side of Eureka Springs. The land is 16 miles from Mercy Hospital in Berryville. The current hospital is 14.3 miles from Berryville but has been grandfathered in under Medicare.
Bariola has said that a new hospital could cost between $10 million to $15 million.
State Desk on 09/06/2014