Kentucky’s Cabinet for Health and Family Services has approved six permits that set the stage for St. Elizabeth Healthcare and a New Jersey partner to build a $31 million specialty hospital on Dolwick Drive in Erlanger.
The Northern Kentucky Behavioral Health Hospital will have 197 beds to treat patients with psychiatric problems as well as people who are battling substance abuse, including heroin addiction, according to a thick stack of documents that have been filed with the state.
St. Elizabeth and SUN Behavioral Health of Red Bank, N.J., intend to consolidate psychiatric and substance abuse programs from five locations into the new hospital, according to files that support six requests for what is called a “certificate of need” by the cabinet’s Office of Health Policy.
SUN will own 75 percent of the new hospital and St. Elizabeth will own 25 percent, documents show.
“They now have the authority to build the project,” said Diona Mullins, policy advisor in the Office of Health Policy in Frankfort. She said there was no indication that there had been any opposition to any of the requests for the certificates of need.
St. Elizabeth spokesman Guy Karrick said he believes that the city of Erlanger may have to take one more step before the project has final approval from the city.
When plans to build the new hospital were announced in the spring, St. Elizabeth, SUN and NorthKey Community Care estimated that the new hospital would create 400 jobs, including 270 new jobs that wouldn’t be transferred from other facilities.
The documents also reveal that St. Elizabeth and SUN Behavioral Health will pay NorthKey Community Care off of Kyles Lane in Covington $2 million for the right to operate 57 residential beds that are now licensed to NorthKey, which has 17 locations in the region.
St. Elizabeth now manages the beds at NorthKey and the $2 million transaction won’t occur until the new hospital opens, said Dr. Owen Nichols, president and CEO of NorthKey. Earlier this year, the NorthKey property on Farrell Drive had been evaluated as a potential site for the new hospital.
But the location was rejected because the property has a steep slope and access and egress to and from Kyles Lane can be challenging.
Once the new hospital has opened, the NorthKey property will be used exclusively for out-patient care, Nichols said.
The effort to build the new hospital comes at a time when Northern Kentucky, other parts of the state and other parts of the country have been battling soaring levels of heroin addiction, overdoses and overdose deaths.
The certificate of need applications make it clear that heroin abuse is a primary reason why the new hospital will be built: “Additionally, the facility will help address the heroin epidemic, which continues to be especially problematic in Northern Kentucky,” St. Elizabeth and SUN say in the applications. “Since 2011, there has been an increased emphasis on the treatment of drug addiction in Northern Kentucky, especially heroin. There has also been a general increase in the number of persons estimated with substance use issues in the community.”
Documents filed with the state show that construction is scheduled to begin in January and that the project is scheduled for completion in June 2017.
Far more immediate efforts to battle drug abuse are underway at the Kenton County Detention Center, where jailer Terry Carl set aside 100 of the facility’s 602 beds for prisoners who are coping with drug abuse. The program, which began Sept. 1, has enlisted help from Alcoholics Anonymous, Narcotics Anonymous and the probation and parole department in an effort to discourage inmates from using drugs once they’re released from jail, Carl said.
“They steal or they rob or commit some other kind of crime to support their drug habits,” said Carl, who estimated that 85 percent of the inmates are in jail for offenses that are linked to drugs one way or another.
Kim Moser, director of the 6-week-old Northern Kentucky Office of Drug Control Policy, said her new department was created and funded by Boone, Campbell and Kenton counties in an effort to take a proactive approach to the burgeoning drug problem.
St. Elizabeth Healthcare reported to her that its Northern Kentucky facilities reported 642 overdoses through the end of July compared to 745 for all of last year. She said Northern Kentucky is on pace for about 1,100 overdose emergencies in 2015.
The number of overdose deaths also is alarming, said Moser. She said 55 people died last year in Northern Kentucky, a decline of 17 from the previous year. But when those numbers are adjusted for population and compared to Louisville and Lexington, the largest cities in the state, Northern Kentucky has the highest overdose death rate, she said.
“It’s devastating to families and I think it’s economically devastating to the region,” Moser said. “I think it’s far less expensive to treat them than deal with the long-term effects (of drug abuse).”
Moser also said the incidence of hepatitis B, a liver infection which is usually associated with sharing needles, is “off the charts” in Northern Kentucky -- 2.7 times the rate for the rest of the state and 19.5 times higher than the U.S. as a whole.
Kentucky legislation that went into effect earlier this year allows for the creation of programs that are designed to eliminate needle sharing by intravenous drug users. The Northern Kentucky Health Department will present information about these programs at 6 p.m. Monday and Tuesday at its offices at 20th and Madison in Covington.
The health department office is just a few blocks from a methadone clinic that’s tucked back off of Madison in what had been a discount grocery store. Moser said 1,200 people visit the clinic every day to receive methadone in an effort to end their addiction to heroin.
In order to get state approval for the new specialty hospital, St. Elizabeth and SUN were required to go through the certificate of need process that was established to regulate medical care construction in the state. The process is designed to rule out the unnecessary duplication of costly facilities that could, in effect, drive up the cost of health care.
St. Elizabeth and SUN said in the permit applications that consolidating six offices into the new hospital will have “sufficient size to achieve economies of scale, and thus, more effectively and efficiently serve its patients.” Combining the psychiatric and chemical dependency units at one location also will increase effectiveness and efficiency, St. Elizabeth and SUN said.
Fifty-eight beds that are licensed for chemical dependency care in Covington and 28 that have the same classification in Falmouth will be moved to the new location.
St. Elizabeth spokesman Guy Carrick said the hospital has the license for the 58 beds in Covington but they are not being used because “we didn’t have the physical space for them.” Moving the 28 beds from Falmouth will end the residential treatment in the Pendleton County city.
Karrick said St. Elizabeth plans to redesign the services that will be offered in Falmouth.
Most of the other beds are licensed for general psychiatric care. Fifty-four of those – 22 in Florence, 24 in Edgewood and 8 in Covington – are in St. Elizabeth Healthcare facilities. Fifty-one of those psychiatric beds are licensed to NorthKey, which also holds the license for six beds for tuberculosis treatment.
David Hahn, economic development director for the city of Erlanger, said in an email that he is out of town on vacation and has not been informed that the new hospital will be built on Dolwick Drive.