Hospitals’ operational margins are shrinking, and some financial analysts have said that 2022 may have been the worst year for hospital finances in decades. And the outlook for next year isn’t rosier — increases in hospitals’ labor and supply expenses are expected to continue to outpace their revenue growth.
Though hospitals’ financial circumstances were dire this year, some expansion projects have managed to move forward. Below is a rundown of the three of the most expensive hospital projects that were pursued in 2022.
$5 billion medical campus in Nevada
In March, the city of North Las Vegas, Nevada sold a 135-acre property for nearly $37 million to Pacific Group, a Salt Lake City-based developer. The developer bought the property to build a multibillion dollar medical campus that includes a hospital and research center, as well as office and retail buildings.
In October, Pacific Group broke ground on the medical campus, called Helios. The developer estimated that construction would cost about $5 billion and take 10 years to complete.
Pacific Group is building Helios to expand healthcare offerings in North Las Vegas. The city’s population exceeded 260,000 people in the 2020 U.S. Census, but North Las Vegas only has 209 hospital beds aside from its Veterans Affairs hospital, which is nearby the construction site. More than 70% of people transported to a hospital by the city’s fire department have to receive care outside the city, officials told the Las Vegas Review-Journal in March.
Helios’ hospital will have more than 600 beds, according to Pacific Group. The developer also said the campus will create more than 10,000 jobs for North Las Vegas once it’s complete, as well as add $3.2 billion to the economy each year.
Pacific Group has not yet found a healthcare partner for Helios.
UCSF’s $4.3 billion hospital
In May, the University of California’s board of regents granted approval to the University of California San Francisco to construct a $4.3 billion hospital at UCSF Helen Diller Medical Center, which is located in San Francisco’s Parnassus Heights neighborhood.
UCSF Health is building the new facility to address its capacity constraints. The health system said the new hospital will increase its overall inpatient bed capacity by 37% — from 499 beds to 682. UCSF also said the new facility will create about 1,400 new jobs.
The new hospital is scheduled to open in 2030, and it will meet California’s new earthquake-resistance standards set to go into effect that year. UCSF Health said it is funding the project through external financing, philanthropy and hospital reserves.
UC Davis’ $3.8 billion tower
Just like UCSF’s new hospital, UC Davis’ tower is slated to open in 2030. The 14-story tower and five-story pavilion will replace parts of the medical center that don’t meet California’s upcoming earthquake-resistance standards.
The project, which spans a million square feet, will include about 400 single-patient rooms, new operating rooms, an imaging center, a larger pharmacy and more burn care units. Once the expansion project is finished, the medical center will have 675 to 700 inpatient beds.
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