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Animas Surgical Hospital’s problem would make many businesses envious: It’s growing so fast it needs a 73,125-square-foot expansion.

A second building, an ambulatory surgical center, is in the works, currently going through the city’s approval process, with a final plan set to go before the Durango City Council on Tuesday.

“We’re bursting at the seams, and that speaks to our success,” said Karis Morrall, marketing coordinator for ASH.

ASH, a for-profit surgical hospital center, plans to consolidate most of its outpatient services and add space for a surgical facility in a new, three-story building. In addition, the building will contain space for additional leased medical offices and a retail pharmacy.

Cost estimates for the new building have not been released.

Eye surgery and ear, nose and throat procedures would be moved to the new building, allowing for modifications of the existing ASH facility to improve efficiency.

Morrall said it is too early to determine how many new employees will be hired, and employees will likely work in both buildings. ASH currently has a 3-to-1 patient-nurse ratio.

Brett Gosney, CEO of Animas Surgical Hospital, said, “We have increased our inpatient and outpatient services and have attracted top medical talent to our community, all while operating at or near capacity. This expansion will allow us to serve our patients into the future by providing additional access to quality care and advancing the region as a health care destination.”

The addition will include a two-level parking garage that will add 328 spaces and an additional 30 parking spots outside the parking structure.

Currently, ASH has 82 affiliated adviser providers, who are physicians, physician assistants and nurse practitioners. In 2004, when the surgical hospital first opened, it had 30 affiliated adviser providers. In 2017, ASH had 160 staff members compared with 35 staff members when it opened in 2004.

Surgery Partners, a publicly traded company, is the majority owner of Animas Surgical Hospital. ASH also has 17 physician investors.

Capital Growth Medvest owns the real estate and is developer of the new building.

Many ASH physicians operate satellite offices in Farmington, Pagosa Springs, Montrose and even further away, and Morrall said the facility has become a regional surgical hub.

A number of Amish visitors recently seen on Durango’s streets are coming as patients of Dr. Andrew Cook, an endometriosis specialist who splits his practice between Durango and Los Gatos, California, said Lizette Langefels, director of outpatient services.

“We’re seeing people travel to Durango for procedures because they want to be in a small-town atmosphere. We’re attracting people from Albuquerque and Denver to have procedures done here,” Morrall said.

Mercy Regional Medical Center also is adapting to meet an aging population and is also seeing patients come from farther away, said Mercy spokesman David Bruzzese.

Patients at Spine Colorado, which operates out of Mercy, are an example of patients traveling to Durango with recuperation specifically in mind, Bruzzese said. As a great walking city, he added, Durango is ideal for spine patients, who are frequently prescribed walks as part of their recovery.

Julie Lonborg, vice president of communications with the Colorado Hospital Association, said economic tensions between for-profit hospitals and nonprofits are a situation seen throughout the country.

As a nonprofit, full-service hospital, Mercy also has a trickier financial balancing act than ASH because it must subsidize medical procedures such as 24-hour emergency room operation, intensive care, nephrology and endocrinology, disciplines that don’t pay for themselves.

According to the “The Financial Health of Colorado Hospital, Trends 2011-15” report, the latest available, Mercy operated with an 8.15 percent total profit margin compared with 19.7 percent for ASH in 2015.

Also in 2015, Mercy incurred $807,897 in bad debt compared with $309,902 for ASH, and Mercy reported almost $1.20 million in charity care compared with $5,000 for ASH.

“Mercy is required to provide emergency service 24 hours a day, seven days a week, 365 days a year,” Lonborg said.

“They have to be ready to do this, and there certainly is a cost for that.”

Animas Surgical Hospital’s decision to expand, she said, would have come only after exhaustive market research to ensure demand would support its investment.

However, she said whenever a medical facility expands, a frequent concern arises, especially in small markets, about whether demand is in place to support it.

“When you make a decision to invest in an expansion of a surgical facility, there is a lot of expense to that,” she said.

“You don’t make that decision lightly, and hopefully, they (ASH) have done the work and identified an unmet need and they are not cannibalizing existing demand.”

If approvals from the city are obtained and construction goes as planned, Morrall said ASH is expected to begin construction this fall, with eventual opening of the new building planned for fall 2019.

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