- The Washington Times - Wednesday, February 22, 2006

D.C. Mayor Anthony A. Williams and a Howard University official say a federal requirement that hospitals at least break even financially to qualify for a mortgage program does not apply to their joint venture to build a $400 million medical center in Southeast.

The Federal Housing Administration (FHA) requirement “applies only to existing hospitals” and not start-up projects such as the District’s partnership for a hospital with Howard, Mr. Williams and Howard University President H. Patrick Swygert told D.C. Council members this week.

“The historical operating requirement does not apply to the [National Capital Medical Center] as a start-up institution,” the mayor and Mr. Swygert said in a 36-page document.

Officials from the U.S. Department of Housing and Urban Development, which oversees the FHA, were unavailable for comment yesterday.

The question of whether the requirement applies to the deal is significant because Howard University Hospital operated at a deficit last year, and city and university officials are counting on an FHA mortgage to help fund the project.

The hospital, located on Georgia Avenue in Northwest, lost $17.3 million, according to Medicaid filings.

One of several hospitals in the District to operate at a deficit, Howard said it expects to be profitable again after a restructuring that has included 125 layoffs.

Officials also said outside contributions could help offset the costs of building the National Capital Medical Center (NCMC), which will be located on the grounds of D.C. General Hospital, which was closed in 2001.

“The District and Howard believe that the NCMC will be a national health care model that will attract contributions from third parties,” Mr. Williams and Mr. Swygert said in the document.

The mayor and the university president issued the document in response to written questions submitted last month by council member David A. Catania, at-large independent.

Mr. Catania, chairman of the council’s Committee on Health, was unavailable for comment yesterday.

The council is expected to begin holding hearings soon on Mr. Williams’ plans to split with Howard the costs of building the hospital.

In the document, Mr. Williams and Mr. Swygert urged the council to “move expeditiously to commence work on this vital initiative.”

The new hospital will include the creation of a Level 1 trauma center, increased medical services east of the Anacostia River and a privately funded research center that will focus on health care of low-income and minority populations, they wrote.

The mayor and Mr. Swygert also called for the project to be exempt from a certificate of need regulatory review, saying federal law puts the decision in the hands of local officials.

Mr. Williams has argued against going through the certificate of need process, saying it delays projects for years. He said the council and federal officials already are scrutinizing the deal.

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