Heading north on Route 7 through Ridgefield, drivers pass a blue “H” sign pointing the way to Danbury Hospital.
In a few years time, they will already have passed the northernmost outpost of Norwalk Hospital.
In reserving space in Georgetown Land Development Co.”™s mixed-use facility in central Fairfield County, Norwalk Hospital is establishing medical offices a full 11 miles from its main campus at the base of Route 7 in Norwalk.
For Geoffrey Cole, who has led the hospital for two years, it is a critical strategic move intended to steer additional business toward the hospital by finding quality space for physicians, who in theory will refer patients to Norwalk Hospital for surgery and other medical procedures.
In the fiscal year ending in September 2005, Norwalk Hospital handled more than 102,000 outpatient visits and 45,000 emergency-room patients.
Geographic expansion and branding represent two of the three strategies that could reinvigorate the health-care services industry, according to Larry Keeley, an analyst with Doblin Inc. in Chicago, who led a study on the topic commissioned by the Voluntary Hospital Association.
In 2003, a Target Inc. store in the Minneapolis area opened an in-house medical clinic and the concept has since been duplicated by Wal-Mart Stores Inc. Even renowned entities like Minnesota”™s Mayo Clinic are opening satellite branches to expand their reach.
“The only way to survive is to grow,” Cole said. “Part of the growth notion is that we need to get out into the communities we serve ”¦ Georgetown can be seen as strengthening ourselves on the periphery of our service area.”
A crossroads touching Redding, Ridgefield and Wilton, Georgetown is also on the edge of Danbury Hospital”™s service area. Redding and Ridgefield have a combined population numbering more than 30,000, nearly 40 percent of Norwalk”™s total residents. What”™s more, the Georgetown Land Development site plans to build more than 400 units of housing, some of which is expected to be snapped up by retirees moving out of their houses. And the site is less than a minute from Meadow Ridge, a large assisted-living facility operated by Senior Care Development L.L.C. of Westport.
Danbury Hospital already has affiliate offices in Ridgefield, but not on the scale envisioned by Cole, who plans to add between 30,000 and 50,000 square feet of space.
Â
When Danbury Hospital decided to create an outpatient building last year, it elected to build the 90,000-square-foot facility on its hill campus, spending $45 million.
Danbury Hospital is paying for the facility via bonds, rather than dipping into cash reserves.
Stamford Hospital recently leased 55,000 square feet of space less than a mile from its main building, a decision driven by space constraints.
Cole did not say how much Norwalk Hospital expects to pay for the expansion, but said the institution is funding the expansion out of its own pocket and that of its foundation. In expanding into 100,000 square feet of space on the Norwalk-Wilton line, the hospital is paying $2.5 million.
In the fiscal year ending in September 2005, the hospital”™s $253 million in revenue exceeded expenses by $4.6 million. Combined, Norwalk Hospital and the Norwalk Hospital Foundation had assets worth more than $180 million in 2005.
The hospital employs about 1,900 people and has a payroll of more than $100 million. Cole received roughly $600,000 in compensation in 2005, roughly a quarter more than he made in his previous job as chief executive officer of Emerson Hospital, a community hospital in Concord, Mass.
Â
