EAST GRAND RAPIDS — Spectrum Health plans to relocate long-term acute care to Blodgett Hospital through a partnership with a major national provider in the field.
The as-yet-unnamed joint venture with Select Medical Corp. connects Spectrum Health with a provider that specializes in long-term hospital care and already has a presence in the West Michigan health care market.
The Mechanicsburg, Pa.-based Select Medical operates 123 long-term acute care and rehabilitation hospitals in 27 states, including 11 in Michigan. It typically establishes the hospitals through partnerships with local health systems.
The Michigan locations include Select Specialty Hospital at Mercy Hospital in Muskegon and Mercy Health Saint Mary’s in Grand Rapids, as well as Bronson Battle Creek Hospital.
Select Medical is a “strong and viable” national operator of long-term acute care hospitals, “and really brings experience and expertise around patient care,” said Chad Tuttle, president of Spectrum Health Continuing Care.
“We can really leverage the strengths of both organizations,” Tuttle said.
Long-term acute care hospitals, commonly referred to as LTACHs, care for patients who have suffered a serious injury or illness and require a lengthy hospital stay.
Spectrum Health’s LTACH last year provided care for about 225 patients who stayed in the hospital an average of 29 days, Tuttle said. About 80 percent of the LTACH’s patients come from the local market.
In Grand Rapids, Spectrum has drawn “a few” long-term patients who come to the city from a five-state region for specialized care or to be close to family while they are hospitalized and recovering, he said.
By moving the Spectrum Health LTACH from the Fuller Street campus to Blodgett Hospital by mid-summer, the hospital will offer patients care in a setting that has additional medical services readily available, Tuttle said.
“Quite frequently, LTACH patients will benefit from access to other acute-care services,” he said. “Operating an LTACH outside of another hospital doesn’t allow for ready access to those other acute care services.”
Spectrum Health plans to spend $7.4 million to renovate the sixth floor of Blodgett Hospital to house the 36-bed LTACH, according to a letter of intent filed in March with the Michigan Department of Health and Human Services.
The Grand Rapids-based health system and Select Medical have had a “very collegial” business relationship for years and talked several times about a potential joint venture, Tuttle said. With space available at the Blodgett campus to house an LTACH, the two decided to act, he said.
“As we most recently had conversations and identified the clinical space within Blodgett, we just recognized that now is a good time and the opportunity was there for this to happen,” Tuttle said. “The space that is being renovated is being underutilized in many ways.”
Spectrum Health has been examining how better to use the capacity at Blodgett Hospital and Butterworth Hospital in downtown Grand Rapids and where best to locate medical services, said Tina Freese Decker, president of Spectrum Health Hospital Group.
Putting the LTACH in East Grand Rapids was one of the moves the review identified, Freese Decker said.
“It makes a lot of sense to connect it with some of the other services there,” Freese Decker said. “It’s an opportunity to do it even better and more efficiently by placing it in Blodgett.”
In addition to its LTACHs, parent company Select Medical Holdings Corp. (NYSE: SEM) operates 1,611 outpatient rehab clinics in 37 states and the District of Columbia, plus 38 Concentra occupational medical centers in 38 states and D.C. The corporation recorded operating revenues of $4.28 billion in 2016 with net income of $125.7 million.
Spectrum Health right now is focused on providing long-term acute care only through the joint venture with Select Medical.
“This is the first step in our partnership with Select,” Freese Decker said. “We need to implement this as we go forward over the next four or five months. I’ll never shut a door, but we have to make sure we do this one first and do it well.”