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Monday, Dec 5, 2022

South OC Expansion Push for Local Hospitals

Providence Mission plans $712M investment

Providence Mission Hospital is planning to spend $712 million over the next seven years to expand its operations in South Orange County.

The plan includes a new hospital building at its current campus near the San Diego (5) Freeway and Crown Valley Road in Mission Viejo. Also on tap are new urgent care facilities, in both OC’s southern-most city, San Clemente, and the newer community of Rancho Mission Viejo (see story, page 13).

“It’s a really big deal—it will be amazing for our community,” Providence Mission Hospital Chief Executive Seth Teigen told the Business Journal. “I’m so excited about this.”

Providence Mission—one of three local hospitals run under the umbrella of Renton, Wash.-based healthcare system Providence—ranks No. 6 among OC’s largest hospitals, with $719 million in net patient revenue for the year ending Sept. 30, 2021, when factoring in both its main campus and an affiliated facility in Laguna Beach.

Providence isn’t alone among local hospital operators looking to expand their presence in South OC; two other hospital systems are also seeking to expand in the same market, potentially pushing new construction in the area past $1 billion over the next decade.

That figure doesn’t count multiple billions of dollars being spent a few miles north in Irvine, with numerous hospital projects, medical campuses and cancer treatment centers in various stages of development across the city.

Saddleback Addition

MemorialCare Saddleback Medical Center on Sept. 20 broke ground in Laguna Hills on an $80 million Women’s Health Pavilion that it says will transform women’s healthcare in South Orange County.

“Our vision for the Women’s Health Pavilion is to provide a truly innovative and holistic approach to women’s healthcare for our neighbors and friends in South Orange County,” said Marcia Manker, CEO of MemorialCare Saddleback Medical Center.

“With the groundbreaking we want to be ready to meet the growing needs of the community and expand our capacity and research to deliver exceptional care to our community for years to come.”

MemorialCare Saddleback, located next to the city’s former Laguna Hills Mall site, is OC’s eighth-largest hospital, with $388 million in revenue for the year ended Sept. 30, 2021. It’s the largest local hospital run by Fountain Valley-based healthcare system MemorialCare.

The 40,000-square-foot women’s health facility, which is scheduled to open in 2023, will feature a “spa-like environment,” same-day appointments, short wait times and expedited screening results.

The hospital says the pavilion will feature offerings not available in any other Orange County medical center, such as the first integrated breast cancer clinic, featuring a breast oncologist, breast surgeon and breast reconstruction surgeon under one roof, along with the only on-site transition retail shop for patients going through cancer treatment.

It will also have pelvic rehab clinic with a dedicated pelvic floor physical therapist.

The pavilion will have specialists in oncology, women’s health, sexual health, obstetrics and mental health.

“It will be dedicated to all the specialties that a woman needs in every stage of her life,” Manker said.

Hoag Looks South

Hoag Memorial Hospital Presbyterian this year opened a new urgent care facility in Monarch Beach in Dana Point.

“There weren’t any healthcare options there before” in need of health services, Flynn Andrizzi, president of the Hoag Hospital Foundation, the nonprofit arm of OC’s second-largest hospital, told the Business Journal last month.

The Monarch Beach facility could just be the start of Hoag’s push in South OC.

Hoag also says it’s planning to use a $106 million donation from the estate of Audrey Steele Burnand to expand its services throughout the country, with underrepresented communities in South OC a focus.

“Less than a decade ago, Hoag didn’t have any urgent care facilities,” Andrizzi said. “Now we have 15, and we are building even more.”

RMV Growth Prompts Providence Expansion

When executives began planning the future of Providence Mission Hospital, they saw the growth of the nearby inland community of Rancho Mission Viejo, which is several phases into a development that will ultimately see 14,000 new homes built.

“There will be thousands of people in Rancho Mission Viejo as it gets built out in the coming years,” Providence Mission Hospital Chief Executive Seth Teigen said.

The executives asked themselves if they had the capacity to handle such growth.

“The answer was no,” Teigen said of the existing campus in the city of Mission Viejo (population: 92,515), which is about an 8-mile drive from the Rancho Mission Viejo master-planned community. “The older buildings need to be replaced.”

The hospital’s expansion will focus on a new patient care tower with state-of-the-art operating suites and cardiac catheterization labs at its existing campus.

The new tower enhances the neuroscience center, cardiovascular programs and maternity services.

It will also have nearly 100 new private patient rooms.

“When people come into our hospital, they don’t expect a roommate. That’s part of the promise,” Teigen said.

RMV, SC Work

As part of its $712 million expansion plan, Providence is set to build a 42,000-square-foot, high-end urgent healthcare facility in Rancho Mission Viejo, which has seen a large number of homes built for those older than 55.

The facility will have “everything from soup to nuts, where you wouldn’t have to leave that community” to get most care, ­Teigen said.

A similar facility will be built in San Clemente, near its outlet mall just off the 5 freeway.
“Rancho Mission Viejo and San Clemente will be the cornerstones,” he said.

The centers will be staffed with emergency medicine physicians, a full-service imaging center with advanced diagnostics, and a multi-specialty clinic with primary care physicians, OB-GYNs and other specialty care providers.

“It’s like our Laguna Beach campus. If you get wheeled in there, it can handle most things. If it’s a major healthcare event, patients are transferred to Mission Viejo,” Teigen said.

Emerging Trend

These centers follow a major trend in healthcare to have more surgeries and other procedures done in ambulatory settings where patients can get 95% of their needed services and don’t need to spend the night in a hospital.

“Ambulatory has become more important,” Teigen said. “In the center, there has to be a world-class medical center.”

The Mission Viejo hospital will have about 300 patient beds after the new facilities are constructed. It estimates about 600,000 to 700,000 in South Orange County are covered under its insurance plans.

“We believe we’re the high-value, low-cost provider in the community,” Teigen said.
—Peter J. Brennan

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Peter J. Brennan
Peter J. Brennan
Peter J. Brennan has been a journalist for 40 years. He spent a decade in Latin America covering wars, narcotic traffickers, earthquakes, and business. His resume includes 15 years at Bloomberg News where his headlines and articles sometimes moved the market caps of companies he covered by hundreds of millions of dollars. His articles have been published worldwide, including the New York Times and the Washington Post; he's appeared on CNN, CBC, BBC, and Bloomberg TV. He was awarded a Kiplinger Fellowship at The Ohio State University.

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