Stakes high for hospitals in Snohomish County

Published 6:05 pm Monday, January 18, 2010

Competition in Snohomish County between two big health care organizations — Providence Health &Services and Swedish Health Services — is heating up into a high stakes poker game.

Seattle-based Swedish has just disclosed plans to open a satellite emergency room in south Everett later this year, using two of three floors of a new $30 million medical building.

Designed to treat sprains, broken bones, cuts and viruses but not major trauma, heart attacks and strokes, it will be able to treat up to 35,000 patients a year.

And Swedish is on the verge of finalizing an affiliation with Stevens Hospital in Edmonds, promising to spend $90 million in general investments over the next decade and $60 million in building improvements and expansions.

Meanwhile, a new 12-story, $500 million medical tower is under construction at Providence Regional Medical Center Everett, scheduled to open next year. Its new emergency room will have the capacity to treat about 150,000 patients a year, including trauma and other patients with life-threatening health problems.

Combined, these three projects represent a nearly $700 million investment in health care.

It could trigger competition for patients not seen since the years before the 1994 merger of Everett’s two previously independent hospitals — and cross-town rivals — Providence Hospital and General Hospital Medical Center.

Swedish’s entry into Snohomish County “without question is a significant event,” said Rick Cooper, chief executive for The Everett Clinic, which has about 250,000 patients in the county.

Providence has made a huge investment in Snohomish County with its new medical tower, he said.

“I think that I would be concerned about a changing competitive landscape that is occurring at a time that you’re making a half-billion investment,” Cooper said.

Yet Cooper, who has worked in health care in Snohomish County since 1977, said he thinks Providence knows how to thrive in a very competitive business environment.

“I’m expecting Providence will explore any and all options to protect that investment,” he said. “I’ve got to believe Providence is thinking about ways it, too, is going to develop a more regional presence and enter new markets, be it to the south or north.”

When asked about its plans in Snohomish County, Cal Knight, Swedish’s president and chief operating officer, agreed that increasing its presence, or market share, was a goal.

“We want to serve as many patients as we can close to their homes,” he said.

Meanwhile, Dave Brooks, Providence’s chief executive, said he didn’t know whether the new emergency room his hospital is opening next year will lose patients to Swedish’s new emergency room.

Competition between medical groups existed even before Swedish’s entry into the market, he said.

Providence has received national recognition for providing innovative, high quality services while keeping costs low, he said.

“I just want to remind you, Providence has been here in Snohomish County for more than 100 years,” Brooks said. “We’re dedicated to meeting the needs of our community.”

That won’t change, no matter who comes into the market or who leaves it, he said.

“This is our home. After 100 years, I guess you get to say that.”

All this change in Snohomish County, coming at a time when the direction of the economy is still uncertain and Congress is on the verge of approving a sweeping national health care plan, only adds to financial risks to everyone involved in the field of medicine, said Cooper, of The Everett Clinic.

“We’re now probably in the longest recession the country has experienced in years and years,” he said.

And the pending national health care legislation will have significant and permanent implications for how health care is financed and delivered, he said.

All these factors are causing both his own organization and others to rethink how they provide services in a difficult business environment, he said.

“Anything we do will have to add value for our customers — our patients,” Cooper said. “It’s a changing time … It’s exciting, but not without risk.”

Sharon Salyer: 425-339-3486, salyer@heraldnet.com.