Facility Development Case Study
The Case: Replacing Matagorda General Hospital
The Challenges
Located about 70 miles southeast of Houston, then 66-bed Matagorda County Hospital District (MGHD) sat in a county with one of the highest unemployment rates in Texas. Matagorda’s inpatient payment mix – about 70% Medicare, 10% Medicaid, 13% commercial and 7% selfpay – provided further challenges. In addition, as of 2007, the hospital was woefully outdated and faced severe competition from a big city to the northwest brimming with world-class medical centers. The hospital’s leadership wanted to build a replacement facility, but – at the time – bond insurance wasn’t available at any price.
Q Solutions
- QHR began with a debt capacity analysis and a feasibility study.
- QHR subsidiary American Health Facilities Development (AHFD) completed a masterfacility plan involving capital, strategic, financial and facility planning experts and considering the facility’s market, competitive position, physician recruitment needs, demographic trends and volume targets.
- QHR also joined MGHD with InnoVative Capital to undertake the FHA-242 mortgage insurance program to obtain federally backed bond insurance. InnoVative Capital helped secure mortgage insurance from the U.S. Department of Housing and Urban Development (HUD) for a $46 million tax-exempt bond issue to build the new Matagorda General Hospital.
“A facility master plan is much more than an architect’s plan. It’s a roadmap for growing the facility over time,” said Exley Hill, president of AHFD. “How you lay out departments today is critical to achieving growth in the future. The master plan becomes a tool for the hospital’s board and management to make good strategic decisions.”
The Outcome
- Matagorda’s partnership with QHR, and the documented process that was a part of this partnership, enabled the hospital’s leadership to gain the support and confi dence of its board and community – leading to the construction of a new hospital.
- Construction of the new, 118,000-square-foot Matagorda General Hospital started in August 2007, and is scheduled for completion in late May 2009. The new facility will offer area residents more private rooms, an expanded Emergency Department and additional OR space – plus room to grow.
“QHR has been an amazing resource for our hospital throughout this process. Their involvement in the planning phase – from the debt capacity analysis to the master facility plan – was especially helpful. QHR consultants just bring an incredible level of experience and knowledge to all that they do. They help our hospital be successful.”
