Issaquah hospital's approval irks some

Some Eastside hospital officials voiced disappointment this week over the state Department of Health's landmark decision allowing Swedish Medical Center to build a new hospital in Issaquah.

They say that Swedish's proposed 175-bed facility is too big, and unfairly commits all of East King County's hospital growth to Issaquah through 2020.

Friday's ruling marks only the third time in 24 years that the state has approved the construction of a new hospital.

Evergreen Hospital Medical Center in Kirkland released a statement Tuesday in "full opposition" to the decision.

"... By granting Swedish 175 beds, [the state] eliminates the ability for any other Eastside hospital to grow to meet the needs of their respective communities for the foreseeable future," said Evergreen CEO Steve Brown.

But state officials say they took a long-term look at the impact a new facility would have on nearby hospitals through 2020. That analysis showed that the growing need for services on the Eastside meant existing hospitals "were going to be at healthy occupancy rates," said Randall Huyck, an analyst with the state's certificate-of-need division.

If hospital use explodes in other areas on the Eastside, such as Redmond or Bellevue, the state would be open to allowing more beds, he said.

"We'll re-run the numbers," he said. "It may tell another story. We may find that the area needs more beds."

The state's decision comes three years after Swedish — and its Eastside competitor, Overlake Hospital Medical Center — submitted applications to build a full-service hospital in the desirable Interstate 90 corridor.

Overlake officials say they are combing through the state's decision and have until June 28 to file an appeal. The hospital had proposed building a smaller, 120-bed hospital to serve Issaquah.

"The bottom line is that ... there will be no beds available for any other hospital provider until 2020," said Caitlin Hillary, Overlake's vice president of strategy and marketing east of Issaquah.

Officials for Snoqualmie Valley Hospital also expressed concern. They recently announced plans to move the 28-bed hospital — which has suffered financial setbacks and two closures — to a more visible site near Interstate 90. The state's ruling "came as a surprise," said Administrator Rodger McCollum.

"It [the new hospital] will put pressure on our operations," McCollum said. "For instance, there are only so many nurses to go around. This takes a scarce resource and spreads it even thinner."

Kevin Brown, chief strategic officer for Swedish, said Swedish analyzed population forecasts and "the need that we saw was for 175 beds."

Swedish has a freestanding emergency center in Issaquah open for the past two years and "the volumes there are two years ahead of our original projections," he said. Swedish's preferred option is to build on a 15-acre site in the Issaquah Highlands on the east side of Highlands Drive.

The hospital is also considering another 30-acre parcel in Issaquah at the northeast corner of Southeast Newport Way, north of Oakcrest Drive. Target opening date for the first 80-bed phase is 2012.

Both Swedish and Overlake's applications were rejected in 2005 because the state Department of Health said there were enough beds on the Eastside to serve residents' health-care needs for 10 years. As part of its calculation, the state included 132 beds at Group Health Cooperative in Redmond, even though Group Health announced it would close its Eastside hospital by 2008.

Both Swedish and Overlake appealed, but a health-law judge sided with the state's original decision. Swedish — but not Overlake — then took the case to King County Superior Court, saying the state erred by factoring in the Group Health beds.

Judge Bruce Hilyer sided with Swedish and remanded the decision back to the state in January. Since Overlake did not file the same petition for review as Swedish did, the judge told the state to consider only Swedish's application.

Huyck said taking out the Group Health beds reversed their bed-need calculation.

Sonia Krishnan: 206-515-5546 or skrishnan@seattletimes.com