But county’s financial support still needed
The number of surgeries performed annually at the only Tucson hospital south of Broadway is seven times what it was when Pima County ran the hospital less than five years ago.
The hospital at Ajo Way and Country Club Road that the county turned over to a University of Arizona-affiliated physician’s group in 2004 has made strides in improving the quality and quantity of health care to residents of southern Pima County, according to a county report on the status of the hospital.
The report also details the challenges the University Physicians Healthcare Hospital at Kino Campus is facing.
UPH Hospital has become UA’s College of Medicine’s second teaching hospital in Tucson. Its services and facilities have grown to include an intensive care unit, a catheter lab, sports medicine clinic and urgent care. Its improvement and expansion plans extend beyond breaking ground on a $48 million psychiatric hospital in the spring.
Former CEO Norm Botsford, who retired in June, said in a recent interview that he envisions the former Kino Community Hospital one day will be on equal standing with University Medical Center.
But its continuing mission to serve uninsured and low-income patients means that the county’s financial support – scheduled to end in 2011 – is likely to continue for years to come.
“They are not as self-sufficient as we would like to see them,” Pima County administrator Chuck Huckelberry said recently.
“Given the mission to provide to the uninsured, we will always need some help from the county,” said the hospital’s interim CEO Peter Bryan.
UPH Hospital serves fewer patients than Tucson’s other major hospitals, but many more than when it was the county-run Kino Community Hospital.
Emergency room visits have increased to almost 41,000 visits in 2007, from 26,000 in 2004.
By comparison, in 2006 Tucson Medical Center had about 89,000 emergency room visits and University Medical Center had 54,000 visits.
In fiscal 2007-08, the most recent for which data is available, 6,870 people were admitted to UPH Hospital, an increase of 150 percent over 2,744 admissions in 2003-04. Surgeries increased from 304 to 2,103 in the same time period with four of eight operating rooms being used. When the county owned the hospital, one operating room was in use.
The county’s report on the hospital, compiled by Assistant County Administrator for Health Policy Honey Pivirotto, states that the patient increases reflect “improved access to health care for residents.”
The increases are partly because, at least in part, of UPH Hospital’s connection to UA and its expanded role in medical students’ education and providing more places for doctors to practice.
University Physicians Healthcare is a nonprofit corporation that oversees the medical practices of physicians who are faculty members of the UA College of Medicine. It is Arizona’s largest physician group.
Until UPH contracted with the county to run the Kino hospital, doctors with the college worked out of University Medical Center and did research at the Arizona Cancer Center, the Steele Children’s Research Center, the Arizona Arthritis Center and the Sarver Heart Center.
Jean Tkachyk, the UPH Hospital’s chief financial officer, said the college needed more places for medical faculty to practice and conduct research as well as more resources for recruiting physicians to the Tucson area.
“UPH’s primary role is to provide physicians to the College of Medicine,” she said. “However, there wasn’t enough faculty or enough clinical positions. By taking over, we could increase clinical and research faculty.”
UPH Hospital is also increasing the number of student doctors working in Tucson.
In the past two years, six residency programs have been approved in Arizona, four of them at UPH Hospital. Eleven internal medicine residents or graduate medical students, and six psychiatry residents work at the hospital.
In July residency programs for neurology and ophthalmology will begin and the other residency programs will expand for a total of 32 residents at the hospital. A radiology residency program, with 11 students, has also been approved and will start in July 2010. The goal is to eventually have 82 residents at the hospital, said Dr. Vicki Morain, who is the assistant dean for graduate medical education programs and coordinator of the graduate programs at UPH Hospital.
Money woes from the start
County leaders called Kino Community Hospital the “hospital of the future” when it was under construction. However, the hospital was already about $500,000 in debt when the doors opened in 1977 and its financial problems plagued the county for decades.
The last year the county ran the hospital, it lost more than $30 million, Huckelberry said. The death in 2003 of a psychiatric patient led to federal and state regulatory investigations that found numerous problems. The next year, nearly 500,000 pills were found to be missing from hospital pharmacies.
Despite the problems, Botsford was optimistic and said Kino had a “very good shell but, nonetheless, one that needed to be made current.”
A 2004 memo to the board of supervisors from Huckelberry estimated that the cost of bringing the hospital up to date would be around $150 million. According to the county report, about $160 million has been invested in UPH Hospital since 2004.
Tkachyk said it cost UPH $40 million the first year of the transition just to upgrade the equipment.
“When we started, pretty darn close to every piece of equipment was replaced,” Tkachyk said.
New equipment included a second CT scanner, an MRI machine and the equipment for a catheter lab. Botsford said Kino was still using film in its radiology lab and hadn’t converted to digital technology.
UPH believes in hospital
Under the original contract between UPH and the county, Pima County was to give the hospital $127 million over 10 years. Because initial costs were higher than expected, so far the county has given the hospital $110 million, $30 million more than was anticipated by this date.
According to the report, UPH has incurred $70 million in debt since it began running the hospital. Tkachyk said some of that debt reflects investments made to upgrade the hospital as well as bond repayments from 2004, 2005 and 2006.
The contract allows UPH to give the hospital back to the county if it becomes too costly, but Tkachyk said that is not an option.
“We continue to believe that having this hospital and . . . expanding services in this area of town is the right thing to do,” she said.
But Huckelberry and Bryan say the county most likely will continue to subsidize the hospital for years to come.
The county estimates that the hospital’s patient base is about 10 percent indigent or self-pay patients, compared with 1 percent to 3 percent at other hospitals in the county. The cost of serving indigent patients includes emergency care for illegal immigrants.
Huckelberry said the county may end up subsidizing the hospital about $10 million a year, the estimated annual cost to UPH for treating illegal immigrants at the Kino campus.
Bryan said it probably will take the hospital 10 years to completely overcomes its negative reputation.
Sarah Frost, UPH’s spokeswoman, said patient word of mouth will help.
“People, once they come here, . . . are very satisfied,” she said, referring to a Centers for Medicare & Medicaid Services patient survey. “They will recommend it to other people.”
The hospital plans to break ground in the spring on a new psychiatric hospital. A $12 million bond to build it was approved by voters in 2004, and an additional $36 million bond was approved in 2006.
Bryan said UPH Hospital is looking at becoming a level three trauma hospital, meaning it could care for some of the less serious trauma patients in southern Arizona. He said there are also plans for an air ambulance service.
Tkachyk said hospital administrators are still determining how to most efficiently use the hospital’s space, including four operating rooms.
The rooms were built in the 1970s and are not big enough to accommodate today’s technology, Tkachyk said. It is likely, she said, that the four rooms that are not in use would be consolidated to create two large rooms.
In addition, once debt is under control, the potential for expansion is great. The hospital isn’t landlocked the way UMC, TMC and St. Joseph’s Hospital are, Botsford said.
“I think we did something really good for the county, the work force and our corporation,” he said of UPH’s efforts to take over the hospital.
“We’re halfway to three-fourths the way there. It takes a long time.”
COUNTY SUBSIDIES TO UPH-KINO
Fiscal 2004-05 $25.8M
Fiscal 2005-06 $19.8M
Fiscal 2006-07 $14.8M
Fiscal 2007-08 $25M
Fiscal 2008-09 $25M
UPH-KINO CAMPUS SERVICES
Service 2004 2008
Intensive care unit no yes
Catheter lab no yes
Emergency room yes yes
Urgent care no yes
Sports medicine no yes
Graduate Medical Education program no yes
University of Arizona medical students yes yes
MRI no yes
ON THE WEB
University Physicians Healthcare: www.uph.org
Pima County: www.pima.gov
Timeline for Kino Hospital/UPH Hospital at Kino Campus
1972: Pima County proposes building a hospital on the South Side. A $10 million bond to build the hospital is approved by 70 percent of the voters.
September 1973: Pima County begins a “condemnation” process to obtain land owned by Howard Hughes at Ajo Way and Campbell Avenue for the hospital. The county ended up paying $900,000 for the site.
June 1974: The cost to build the hospital is estimated at $29 million.
September 1974: New county hospital is named Kino Community Hospital.
March 1975: Kino is referred to as the “hospital of the future.”
December 1976: Kino is dedicated.
March 1977: Kino is opened to the public after incurring $534,000 in debt.
August 1977: The county turns the hospital over to a management company.
November 1977: Citizen editorial calls the hospital “sicker than many of its patients” because of mechanical breakdowns, forced resignations, thefts and increased operating expenses. Hospital is $1.3 million in debt.
December 1977: 71 nurses sign a letter to the editor concerned that care at Kino is substandard.
May 1978: Kino is $3 million in debt.
July 1978: County supervisors discuss selling Kino. They vote “no” in November.
July 1979: County talks again of selling Kino. The board votes “no” in September.
August 1981: The Kino emergency room closes at night because of a lack of nursing staff.
November 1981: Once again, the county board discusses selling Kino.
October 1983: Kino is $9.8 million in debt.
December 1983: The University of Arizona proposes buying Kino.
May 1984: Kino records its first profit. Transfer to University of Arizona begins.
October 1984: The transfer to the UA is stopped and the county retains the hospital.
May 1985: Kino’s 10,000th baby is born.
1987: Kino shows first year of profit with $460,000.
January 1990: Kino considered in “serious condition” when management is taken over by Schaller Associates Inc.
February 1992: The UA expresses interest in expanding to Kino and wants to use it as a clinic while closing down the emergency department.
November 1992: Pima County Supervisor Ed Moore makes several attempts to close the hospital or at least limit Kino’s functions.
January 1993: The Tucson City Council passes a resolution 6-1 urging the Pima County Board of Supervisors to keep Kino open.
January-July 1993: The fighting between the supervisors over the future of Kino escalates until then-supervisor Raúl Grijalva calls it a “pretty intense war.”
September 1993: University Medical Center, Tucson Medical Center and Carondelet Health Care propose taking over Kino Hospital as a joint venture.
October 1993: The county Board of Supervisors look at privatizing, or selling, Kino Hospital.
1994: Hospital’s debt is estimated at $4 million.
May 1996: County Administrator Chuck Huckelberry proposes using part of the hospital as a mental health facility for juvenile offenders.
June 1997: The hospital announces a $1 million surplus. Also announced: Kino will treat Chicago White Sox players while they are in town for spring training.
August 1998: The county announces that the hospital had incurred $18 million in debt over two years.
July 1999: Kino is $40 million in debt.
October 1999: The Pima County Board of Supervisors approves a $200,000 audit of Kino’s finances.
May 2000: Kino’s labor and delivery services are transferred to University Medical Center.
July 2002: Kino’s $40 debt repaid by a 30-cent increase in the primary tax rate in 2000. However, a new $12 million debt was estimated, mostly because of providing care to indigent patients who don’t pay their bills.
January 2003: County administrators explore the possibility of making Kino solely a psychiatric hospital. A few weeks later, University Physicians and the University of Arizona begin to look at plans to take over Kino Hospital.
May 2003: The county announces that it will fully subsidize the hospital until June 2004, when UPH would take it over.
February 2004: UPH begins transitioning physicians, supplies and staff to the hospital. Upgrades begin.
June 2004: The hospital’s license is transferred to UPH and the hospital’s name is changed to UPH Hospital at Kino Campus.
Source: Tucson Citizen archives
UPH HOSPITAL STATISTICAL SUMMARY
FY 03-04* FY 04-05 FY 05-06 FY 06-07 FY 07-08
Clinic visits 41,968 48,830 59,640 61,025 71,618
Patient days – all units 21,339 23,598 29,633 37,030 38,913
Admissions – all units 2,744 4,200 5,250 6,682 6,870
Surgical procedures 304 662 1,442 1,930 2,103
Emergency Department and Urgent Care 26,329 30,356 37,417 38,999 40,983
*University Physicians Healthcare took over operations on June 16, 2004