Notes from the President — Transforming a vision into reality

Last year we celebrated the golden 50th anniversary of our iconic hospital towers by remembering the challenges we faced back then and how we overcame them with God’s blessing. Necessitating the need for a new hospital at that time was a push from the Council on Medical Education of the American Medical Association and the Executive Council of the Association of American Medical Colleges requiring all medical schools to consolidate classroom and clinical teaching facilities into a single location. A few years later, we met the requirement.

I remember well that day in 1967 when I joined so many others to carefully move patients from the old Nichol Hall hospital to our new beautiful clover leaf building. I’m now struck by the parallels of that moment in our history and where we are today. 

We are now five years into the Vision 2020 campaign and the associated goal of creating One Loma Linda with our updated name — Loma Linda University Health — and our integrated organizational structure. This entire strategy was designed to enable us to effectively meet the challenges of the future. Necessitating the need for this was a California state mandate to build a new hospital that met and exceeded California’s newest seismic standards. That construction began nearly two years ago and is well underway, with the steel infrastructure now starting to give shape to the common pedestal and the two towers. Construction is running on schedule, and you can expect to see the steel frame of all 16 stories of the new Medical Center and all nine stories of the new Children’s Hospital in place by the end of the year. 

Our “One Loma Linda” strategy has performed beyond our expectations. It has brought renewed collaboration between our physicians and hospitals and opened up enhanced educational opportunities for our students. While the university enrollment has dipped down a bit the last four years, following national trends, this autumn shows promise of bouncing back strongly. Additionally, our hospital network and Faculty Medical Group have each had their strongest financial year ever, with continued growth in both capacity and revenue. Sometimes expansion can happen too fast, and now with around 16,000 employees altogether, we have asked each campus entity to limit their expenses so we remain both lean and strong.

Vision 2020 began with a transformative gift of $100 million from Dennis and Carol Troesh. Our total philanthropy goal has actually expanded twice since then from the original $350 million — first with a $10 million gift from the San Manuel Band of Mission Indians for our San Bernardino campus, and more recently with a nearly completely raised $6 million for our Indio clinic. Numerous other gifts and pledges, both large and small, have now carried the campaign to nearly $300 million of our revised $366 million goal. 

But philanthropy was only part of the financial plans for the new hospital, as well as the other projects outlined in Vision 2020, which include scholarships, a research building, and wholeness strategies. The entire hospital building project — including the three new parking structures recently built — will reach a total of around $1.4 billion. The resources for this amount were carefully calculated to come from four main sources — bond financing, two state grants to pay a portion of costs of construction of children’s hospitals, philanthropy and operating gains from our hospitals.  

Each of those strategies has performed well to date, with the exception of disbursements of the children’s hospital grant funds. We continue to believe that we are entitled to the full grant amounts, but the state has delayed disbursements. There have also been some cost overruns on additional steel now being required by the state since the original plan was developed. Fortunately, all our steel has been paid for before the recent steel tariffs were implemented, so that isn’t hurting us. But with the extra steel required and the uncertain timing of receiving the state grant monies, we have decided to take out another bond offering to assure completion of the building on time. This new borrowing will ease the pressure on cash flow by financing the costs of the extra steel and by covering certain routine capital purchases that historically have been budgeted and funded out of operations. 

The building completion is now scheduled for the fall of 2020, with actual occupancy in early 2021. This is a bit past the state statutory deadline of Dec. 31, 2019, but we believe the deadline will be further extended by legislation that is currently pending before the California State Legislature.

To have come so far along in our philanthropy goals is truly amazing and we are deeply grateful to our many donors for making this happen. Our hope now is to far exceed our original goals and maintain the momentum that has been generated so we can better fulfill our mission through clinical care, education, research, and wholeness. A Wholeness Institute will focus and share our traditional commitment to improving health practices, and a new research building is still greatly needed to let us expand our growing network of investigators. These will complement the Comprehensive Cancer Center we are planning. 

In this context, I frequently get asked if I am worried, confident or scared. The answer is probably some combination of all of those. I often step outside my office at Magan Hall to the Founders Plaza and read again the story of Loma Linda University Health’s beginning. I am sure that our founder John Burden and his colleagues had many of the same concerns we do now. But the overpowering sentiment in my heart and on our campus is that this is a special place, endowed for a purpose by God Himself. That assurance is enough to keep us focused and moving forward. Thank you for your confidence in Loma Linda University Health. We invite you to watch the construction live at lluhvision2020.org and prepare to join us for a grand opening in the future! 

Richard Hart, MD, DrPH
President
Loma Linda University Health