Lancaster General Health has temporarily halted work on its hospital expansion project, citing a need to adjust plans after costs started climbing.
Spokesman John Lines said the challenges are due in part to “working in an urban location around existing buildings and underground utilities.”
Last May, the health system said that adding a six-story tower to its flagship hospital in the 500 block of North Duke Street in Lancaster would cost about $60 million and take about two years.
Now, Lines said, work is slated to resume in April, the estimate stands at $67.3 million, and the addition is not expected to open until early 2018.
However, he said, the project will still achieve its original goal of enabling the hospital, which currently has 71 semi-private rooms, to transition to all-private patient rooms, which are now standard in the industry.
He noted that a decision to add additional technology to the rooms — to help patients be more informed about and engaged in their care — also contributed to the increased cost.
Lines also said Lancaster General Health expects to save about $8 million due to the unrelated recent consolidation of its roughly $173 million in public debt with the debt of University of Pennsylvania Health System.
The Philadelphia-based university and the Perelman School of Medicine are jointly known as Penn Medicine, an entity that Lancaster General Health joined in August 2015.
The Lancaster County Hospital Authority approved the debt consolidation, authorizing a bond of up to $570 million.
“We eliminated duplication of effort and improved our combined financial position for the future,” Lines said.
The consolidation does not add additional debt to Lancaster General’s balance sheet or put the Authority or Lancaster County under any liability for the debt, he said.
Lines also noted that, as the parties described when announcing the Penn Medicine deal, Lancaster General continues to maintain its own balance sheet and its assets remain in the local community.
On March 9, Moody’s Investor’s Service assigned the proposed consolidated bond its fourth-highest rating, Aa3, indicating a very low risk. It noted that the bond is expected to mature in 2047.
A spokeswoman for Pennsylvania College of Health Sciences, which is part of Lancaster General Health,said the college’s planned move from Lancaster city to Greenfield Corporate Center remains in line with its planned $67 million budget and on schedule to welcome students in August.
“The construction on the academic building is slated to finish in June and moving will take place over the summer months,” Stephanie Ellis wrote in an email.