The Johns Hopkins medical institutions have decided to pursue a suburban strategy. Last month they announced that they will build a $10 million four-story medical office building at Green Spring Station in Baltimore County. The facility's tenants will all be doctors who are affiliated with Hopkins and who Hopkins hopes will send their patients downtown to Hopkins Hospital.
Market forces and urban realities have driven the Hopkins decision to establish a beachhead in suburbia. To understand the dynamics, consider these simple numbers. It takes a patient population of about 1,000 people to require enough in-patient care to fill one hospital bed for 365 days a year. So for Hopkins Hospital to fill all its 1,000 beds, it must have a patient base of at least a million people.
Where can Hopkins find that large a patient base?
Per capita hospital use is declining. Managed care, Health Maintenance Organizations (HMOs), medical advances like laparoscopic surgery, and new outpatient technologies all reduce or even eliminate the need for hospitalization. So a hospital's patient base must continually grow if it hopes to keep its beds full.
Where can Hopkins find a large and growing patient base?
The Hopkins medical institutions in east Baltimore are surrounded by some of the worst poverty in the city. About 20 percent of their patients are uninsured indigents to whom Hopkins must provide hospital services. This is a far heavier burden than is borne by any of the suburban hospitals with which Hopkins must compete.
Where can Hopkins find a large and growing base of well-insured paying patients to carry its uncompensated indigent care?
Any hospital's patient flow depends on its affiliated doctors. Historically, Hopkins has had a large network of Hopkins doctors in the city. They served plenty of affluent suburbanites. But patients are now increasingly reluctant to come into the central city. Fear of crime and concern about parking have an effect. But convenience seems to be the most important factor. Most people want to drive only a few minutes to a doctor's office. So patient preferences are pushing doctors to move their offices out of the central city. Hopkins, however, cannot afford to lose these doctors and their patients to suburban hospitals.
How does Hopkins maintain its affiliation with doctors who move to the suburbs?
The new facility at Green Spring Station was conceived to meet all these challenges. If it succeeds in providing a secure and growing stream of patients, Hopkins will surely consider building similar satellites in places like Columbia, Annapolis and other suburban locations.
These market forces and Hopkins' new suburban strategy will have a serious impact on Baltimore. About half the tenants in the new building at Green Spring Station will be doctors who now have offices downtown. When the new building opens next year, they will move their large and established practices to the county. If Hopkins builds other suburban centers, more city doctors will follow. In effect, another important industry is now slowly leaking out of the city.
That's not the fault of Hopkins. Market forces are driving this development, and Hopkins' suburban strategy is designed to protect its downtown business from further patient losses to suburban hospitals.
There were ways, however, to achieve Hopkins' important goals without leaving the city. Why not a suburban site within the city limits? Green Spring Station may have offered advantages. But no compelling business or financial reason forced Hopkins to choose a location in the county rather than Cross Keys, Mount Washington or some other suburban location in the city. If there were problems with any of the city sites, why didn't Hopkins go to the city administration for help in working them out?
In fact, Hopkins never discussed its plans with the city, and the move to Green Spring Station came as a complete surprise to city officials. How did that happen? The Hopkins medical institutions are Baltimore's most important economic growth engine. The city ought to treat them as its most important client, as it would hopefully treat a Fortune 500 company headquartered here. When it comes to Hopkins, however, the city seems asleep. It allowed its largest single employer to take a significant step away from Baltimore without doing anything about it.
In fact, the city generally displays no sense of urgency about Hopkins' problems. Little things. Every street corner seems to have a sign pointing to Camden Yards, but how many signs help patients find Hopkins Hospital? Those who know the way have to dodge the potholes on Monument Street.
Big things. It took a highly-publicized rape and kidnapping to spur the city into starting to think about effective action against crime around the east Baltimore campus.
Huge things. The Enterprise Foundation originally proposed to locate its innovative Habitat for Humanity neighborhood transformation project in east Baltimore. There it not only would have helped poor people but also would have upgraded the neighborhoods near Hopkins. But the city insisted on putting the project in west Baltimore where there is no comparable institutional benefit or economic spin-off.
Like University Hospital across town and all other inner-city academic medical centers in America, Hopkins faces severe challenges. Will it continue to attract enough paying patients? Will it shrink from a multi-purpose comprehensive health facility to a 200-bed high-tech intensive-care unit? Can it continue to compete while carrying cost disadvantages? Can it even survive? Or will it eventually follow downtown department stores into oblivion?
These challenges are as important to Baltimore as they are to Hopkins, and the hospital and the city must work together to support each other.
Tim Baker's column appears on alternate Mondays.