Famous NY orthopedic center to partner with Good Sam parent Tenet

5:13 p.m Thursday, Jan. 11, 2018 Business
Dowtown West Palm Beach Wednesday, January 28, 2015. (Lannis Waters / The Palm Beach Post)

Got back problems? Good Samaritan hospital has your back. The hospital’s parent company, Tenet Healthcare, is bringing the world-renowned Hospital for Special Surgery to West Palm Beach.

In the latest out-of-area medical facility partnership with local providers, Good Sam’s parent has teamed with the Hospital for Special Surgery to open an orthopedic care center at 300 Palm Beach Lakes Blvd., across from Good Sam. HSS has been rated the No. 1 hospital for orthopedics for eight consecutive years, according to U.S. News & World Report.

Through a Tenet subsidiary, United Surgical Partners International, plans are to offer outpatient orthopedic care including diagnostic services, ambulatory surgery, rehabilitation and sports programs. The facility will be staffed by HSS doctors, some of whom will still work at the main campus in New York.

HSS is the fourth major out-of-state medical provider to set up shop in Palm Beach County. Mount Sinai of New York, NYU Langone and Cleveland Clinic all have established centers in West Palm Beach.

But this deal is by far the most surprising one, given that it is with Tenet, once a vociferous opponent of outside players in the West Palm Beach marketplace. Tenet owns Good Samaritan Medical Center at 1309 N. Flagler Drive and St. Mary’s Medical Center at 45th Street.

Tenet and HSS declined to elaborate on their barebones announcement of the agreement, including how many doctors would work at the center and when it would open. Their only remarks were made in a prepared statement.

HSS President Louis Shapiro noted that “many Florida residents travel to HSS in New York” for musculoskeletal care. With this expansion, HSS will be making that care more convenient to patients in South Florida, “where quality of life is so highly prized,” Shapiro siad.

Ron Rittenmeyer, chief executive of Dallas-based Tenet, said the deal will create “a center of excellence” for patients and expand Tenet’s lines of service. There was no word on how the arrangement would affect orthopedic surgeons who have hospital privileges and medical offices at Tenet properties.

Nonetheless, Tenet’s track record is well known when it comes to out-of-state medical providers. Up until now, Tenet has not liked them.

Just a few years ago, Tenet fought efforts by developer Michael McCloskey to build a medical center on the city-owned tent site.

The medical project, at Okeechobee Boulevard and South Dixie Highway, was to include as prospective tenants non-hospital medical facilities run by Jupiter Medical Center, Miami Children’s Hospital,Caron addiction treatment center and New York’s Mount Sinai Medical Center.

Even back then, HSS was interested in opening offices in the project, too, McCloskey said. (HSS already has a Palm Beach office that provides “ambassador services” to help South Florida residents who choose to travel to the HSS main hospital in New York for medical care.)

But St. Mary’s and Good Samaritan medical centers opposed McCloskey’s medical center project. In fact, at one city meeting, former Good Samaritan Chief Executive Mark Nosacka asked, “Why is there a rush to bring in our competitors?”

West Palm Beach City Commissioner Keith James led the charge against McCloskey’s proposal, saying in 2015 it might “cannibalize” existing medical businesses in the city. That plan was rejected after two years of development negotiations.

In an interview Wednesday, James said he was opposed to McCloskey’s plan because McCloskey wanted taxpayer incentives as the developer, on behalf of the tenants that would be creating jobs. The city does sometimes provide taxpayer incentives to companies moving into town, “but this was one step removed,” James said.

Having said that, competition is competition, James said. So if Tenet wants to get more market share or expand its brand and is willing to pay, “go for it,” James said. “As long as the government isn’t being asked to write a check.”

McCloskey wasn’t surprised by the Tenet deal, noting that alliances are exactly what he had in mind when he first proposed the medical center project in 2013. “They all want to be here,” he said of outside providers. “The patients want the brand names, and these guys have realized the smart business move is to be here to provide these services.”

Despite Tenet’s efforts to block his medical center, “I guess they figured if you can’t beat ‘em, join ‘em,” McCloskey said.

But real estate broker Michael Feldman said HSS and Good Sam have been talking “for years. … It’s a long time in the making.”

Tenet benefits from the arrangement in a few days, said Feldman, director of the Florida health care practice group for Cushman & Wakefield in West Palm Beach.

Complex procedures requiring hospital stays will be performed at Good Sam, Feldman said. In addition, if patients developed complications during treatment at the HSS clinic, they would be routed to the hospital.

“It’s advantageous to both groups for the purposes of revenue and the number of procedures,” Feldman said.

Cleveland Clinic was first to Palm Beach County in 2007, leasing a small West Palm Beach office until it took a large block of space in the CityPlace Tower offices at 525 Okeechobee Blvd. The Ohio-based center is opening an office in Wellington, expanding its reach into western Palm Beach County.

In 2016, Mount Sinai Hospital of New York and Jupiter Medical Center announced they had expanded their affiliation and last year opened offices in West Palm Beach at 625 N. Flagler Drive, now known as the Jupiter Medical Center Mount Sinai New York building. McCloskey and partners bought the former Bank of AmericaCentre office building to replicate the medical center plan for the tent site. So far they’re succeeding: In addition to clinic offices offering services such as cardiology, gastroenterology and oncology, Jupiter Medical last year opened a ground floor urgent care center in the building.

Then in December, NYU Langone Health opened its West Palm Beach medical office at its new location at 101 N. Clematis St. The 6,500-square-foot office features 14 exam rooms and has been in the works since last summer. The medical office is next to Pistache restaurant and part of Waterfront Clematis, a downtown two-building office and retail complex on Clematis between Narcissus Avenue and Flagler Drive.

There’s a reason why West Palm Beach is a favorite among out-of-state medical providers. They all like being near Palm Beach, where they can raise millions of dollars each year from wealthy island residents.

And all medical providers like being in Palm Beach County, where there is a growing population that also carries health insurance.

The Good Sam/HSS orthopedic center will be housed in a building formerly dubbed the Z Palm Beach condominium. Developer Tarek Kirschen tried to peddle eight condominium units each costing $2.3 million, plus a free Tesla Model S electric car thrown in.

But the condo-Tesla idea never gained traction. The property sold in July for $5.5 million to a Texas-based entity, according to Palm Beach County property records. Kirschen paid $1.4 million for the former nurses’ residence in 2012, then flipped it to a separate entity in March for $2.8 million, which then sold it to 300 PBL Development LLC of Addison, Texas, public records show.

The HSS/Tenet office will seek to capture patients from Palm Beach who used to go one place when they needed excellent medical care: The airport, where they could fly to renowned medical facilities in the Northeast, said Kelly Smallridge, president of the Business Development Board, the county’s chief business recruitment arm.

“But the marketplace has changed. Unlike the old days there are no boundaries anymore,” Smallridge said. With the county’s population at 1.4 million, plus more residential growth planned, “there’s enough business to go around,” she said.