Banner Health will close its oldest East Valley hospital and build a new one in Gilbert in 2007 in an attempt to avoid massive renovation costs at Banner Mesa Medical Center while capitalizing on surging growth to the southeast, Banner officials said Thursday.
Banner Mesa CEO Becky Kuhn will take the helm of the new, full-service Gilbert hospital when it opens with 165 beds on the southwest corner of Higley Road and U.S. 60.
The $189 million acute-care facility will focus on obstetrics, general pediatrics, emergency services, general surgery and other services.
A big demand will likely come from growing families, Kuhn said.
"Clearly no city in this country is growing as Gilbert is growing," she said. "When we look at the community and being able to be served by another major medical center, it makes sense to position any new hospital in a growing area."
By contrast, Banner Mesa, near Country Club Drive and Brown Road, serves a more stable population in northwest Mesa. Banner found that many patients in the community were traveling less than 12 miles away to Banner Desert and Banner Baywood medical centers in Mesa, helping to make Banner Mesa and its 166 staffed beds the least crowded of its sister facilities in the East Valley, Kuhn said.
But the key factor in deciding to shut down Banner Mesa, formerly known as Mesa Lutheran Hospital, was the estimated $138 million needed to completely restore electrical, plumbing and heating and ventilation systems in the 41-year-old facility, said Dan Green, a Banner Health spokesman. The upgrades would be required for the kind of technology Banner Mesa would need to become a more modern hospital.
"That kind of investment approaches the cost of a new hospital," Green said. "It just didn’t make sense to make that kind of investment."
Banner officials said they do not yet know what they will do with the hospital once it closes. The Phoenix-based hospital company plans to solicit community comments to determine future plans, which could include providing other health care services or selling the property, Green said.
Kuhn said Banner Mesa’s 1,000 employees, who learned Thursday of Banner’s plans for the two hospitals, should have no problem finding a job at Banner facilities. The Banner system hires more than 4,000 employees each year. The new Gilbert hospital alone will be hiring nearly 1,000 employees, she said.
"We fully expect everyone at the close of three years will have a job which they’re happy with," said Kuhn.
Banner’s Gilbert facility will be the third new hospital announced in the East Valley in two years. Catholic Healthcare West continues construction of Mercy Gilbert Medical Center, an 88-bed hospital on Val Vista Road and the future Loop 202. And IASIS Healthcare has announced plans to build a 170-bed hospital on the southeast corner of Crismon Road and Southern Avenue in Mesa.
Despite their proximity, the hospitals will have plenty of business from a rapidly growing area that is demanding more health care services, Green said. Banner officials are also counting on the new Gilbert facility to attract patients who go to Banner Desert and Banner Baywood medical centers, where wait times in the emergency department often stretch several hours.
Banner Health owns property across the street from Mercy Gilbert Medical Center, where the company planned to build a hospital until Catholic Healthcare West moved forward with its own plans. Fortunately, Banner owned 60 acres at Higley and the U.S. 60, Green said.
"We’ve had this property for a long time, and now we believe it’s time to place a hospital on that property," he said.