Grady Memorial Hospital raised millions, close to fund-raising goal

12:23 p.m Friday, Dec. 29, 2017 Local
Ben Gray/The Atlanta Journal-Constitution
Grady Memorial Hospital. Ben Gray / AJC FILE PHOTO

A decade after Grady Memorial Hospital nearly closed its doors, local governments and private donors have together pledged nearly $150 million to pay for the hospital system’s expansion.

With the contributions, the hospital is only $16 million away from the $165 million fund-raising goal it announced this summer. The money will pay for the construction of a seven-story advanced surgical services center with operating and recovery rooms across the street from the main hospital building and the modernization and expansion of the Ponce de Leon Center, which treats more than 6,000 people a year with HIV and AIDS.

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Around 650,000 people visit the hospital every year, many in the trauma center.

“I was surprised how far they’ve come,” said Christopher Kane, a principal at advisory and care management services firm Progressive Healthcare. “They are really near the finish line.”

Renay Blumenthal, president of the Grady Health Foundation, said the hospital system is aiming to raise the rest of the money — $16 million by spring. So far, Fulton County commissioners agreed to bond up to $60 million for the project, and DeKalb County commissioners up to $30 million. The Woodruff Foundation had pledged $50 million to the total. Other contributors include the O. Wayne Rollins Foundation, the Marcus Foundation, Gilead Sciences, Inc. and members of Grady’s board.

“I think people understand that Grady is such a community asset,” she said. “Only 10 years ago, we were in a crisis. Grady’s in a different place, thankfully.”

Over the past decade, the hospital has had new leadership and has restructured its once-crippling debt. It has taken steps to be a hospital of choice, in addition to serving the metro’s most vulnerable, and Blumenthal said the success of those efforts have led to the need to expand.

The Atlanta Journal-Constitution
A surgery takes place at Grady Memorial Hospital in Atlanta. A large share of Grady’s patients are uninsured and can’t pay, so the federal government subsidizes the hospital for some of that. The subsidies are now being cut. PHOTO by ELISSA EUBANKS / AJC

People who have elective surgeries are often rescheduled if emergency surgeries need to take precedence, Blumenthal said. In part, the expansion will allow those elective procedures not to be displaced by emergencies, which will help Grady attract more patients who use insurance to cover their medical costs. Expanding the payer mix will continue to help Grady’s bottom line. The hospital is operating at full capacity, Blumenthal said.

“We’ve turned the tide,” she said. “The strategy is working.”

In August, Grady Health System CEO John Haupert said several local foundations were waiting for public support before they committed money. Haupert said government contributions would “go a long way” toward bringing others on board. While Fulton and DeKalb counties contribute money for operating costs, it had been 25 years since they gave money for capital improvements.

Ten years ago, the Robert W. Woodruff Foundation gave $200 million to help Grady keep its doors open. Russ Hardin, the foundation’s president, said that gift was “a big leap” for the foundation. He said the unanimous votes from Fulton and DeKalb counties to support the hospital was “really encouraging” as he considered another contribution.

The Atlanta Journal-Constitution
Fulton County plans to help fund Grady hospital’s expansion. BOB ANDRES /BANDRES@AJC.COM AJC FILE PHOTO

Hardin said he considered the role the Woodruff Foundation played in keeping Grady’s doors open “to be a great success,” and so was willing to continue to support the hospital in its expansion.

Since the foundation’s last contribution, Hardin said, the hospital’s facilities, bottom line and patient outcomes have all improved beyond his expectations.

“It just made an awful lot of sense,” Hardin said of the expansion plans. “Grady over 10 years has earned the counties’ support and community’s support. It’s an investment we feel very good about.”

Eliot Arnovitz, who joined the Grady Healthcare Foundation Board less than two years ago, said Grady’s comeback story has been “remarkable.” He contributed to the planned expansion, he said, because he wanted to support the well-kept, well-maintained hospital that he’s seen in recent years.

“Everybody likes a winner, and Grady’s a winner,” Arnovitz said. “It’s a credible fundraiser, and not someone with a pipe dream. It’s something you can see and feel and touch.”

That switch — to a high-performing health system, a winner — encourages even more people to get involved in Grady, said Kane, with Progressive Healthcare. He said the region’s relationship with the hospital has changed as business leaders have embraced Grady, and their belief in its sustainability has led to increased credibility and more growth.

Jason Getz / AJC/jgetz@ajc.com
November 8, 2012 - Atlanta, Ga: A patient lays on a stretcher as they wait to be treated in the Red Zone of the Grady Emergency Room at Grady Memorial Hospital Thursday morning in Atlanta, Ga., November 8, 2012. In 2012, Georgia received more than $275 million in federal funds to help hospitals, such as Grady, at least partly make up for the money they lose caring for the poor and uninsured. But much of that money is expected to go away starting in 2014 as part of a requirement under the Affordable Care Act - a move that experts say could threaten the financial stability of Georgia's safety net hospitals. JASON GETZ / JGETZ@AJC.COM

The hospital system is on the map for philanthropists in a way it hadn’t been before, Kane said. He doesn’t think it will be difficult for Grady to raise the remaining funds, now that it appears leaders feel like they are getting a return on their investments, instead of simply plugging financial holes. In addition to the money needed for construction, Blumenthal said she hopes to raise an additional $10 million to enhance the hospital’s behavioral health and ophthalmology services, and for other program needs.

Kane praised the stroke and burn centers, in particular, as contributing to Grady’s improving reputation. He said those and other specialties have contributed to Grady being known as more than a safety net hospital.

“That’s a world of difference,” he said.

The surgical services center would add six dedicated operating rooms for an ambulatory surgery center, to handle scheduled surgeries. It also would have dedicated rooms for gastrointestinal procedures, an outpatient imaging center and a relocated cancer center. The moves will allow the hospital to add 52 beds. Altogether, the project would increase clinic capacity by 45 percent and operating room volume by 25 percent.

The Ponce de Leon Center, which treats more than 6,000 people a year with HIV and AIDS, would be modernized and expanded.

Construction should begin next September, Blumenthal said. The projects should be finished in spring 2021.

Additionally, Grady would pay $38.3 million for a 660-space parking deck and has already paid for the former Fulton County Aldredge Health Center, where the new surgery center would be built across the street from the main hospital building.

Blumenthal said some potential donors turned her down and others offered less money than she had hoped. But she said overall, the reception has been good.

“People’s perceptions have changed and continue to change,” Blumenthal said. “People feel good about where Grady is right now. …Ten years ago, it was a vote to not close Grady. Today, it exemplifies a vote of confidence.”

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