CLIFTON PARK — The news last week that Ellis Medicine wouldn’t build its long-planned outpatient surgical center was a hiccup in the remarkable and continuing expansion of the medical landscape in Southern Saratoga County.
Within about a decade, more than $100 million has been spent building medical offices and treatment centers there, mostly in Clifton Park, where the treatment options previously had involved a drive to Albany, Schenectady or Saratoga Springs.
The boom isn’t over: Last week health insurer CDPHP and five medical partners announced plans for a 40,000-square-foot multi-specialty medical center on Route 9. And Ellis itself said it still plans to expand at the site of the medical center it opened on Sitterly Road in 2012 — just not with a new surgical center, a plan it introduced in September 2017.
“That site has been successful,” said Paul Milton, president and CEO of Schenectady-based Ellis Medicine. “Inside that building we may do some reconfiguration and expansion. Primary care is one of the things we’ll stay focused on in that community.”
John Scavo, Clifton Park’s planning director since 2008, has had a high-level view of much of this period of expansion in town.
“We’ve seen probably either at or above $100 million in investments in health care,” he estimated.
As a municipal planner, Scavo looks at a proposal for a new medical facility to determine whether the community has a need for it and what impact the facility would have on the town.
He doesn’t evaluate whether the market for those services is becoming saturated. But his informal opinion is that Southern Saratoga County hasn’t reached saturation, even with all the new facilities.
“You always get into the argument of, there’s a facility 15, 20 minutes away,” he said. “There’s a level of customer convenience as well as emergency services.”
Scavo noted that Clifton Park and fast-growing Halfmoon have as much population combined as many of the cities in upstate New York but no hospital within their borders, so it’s a logical evolution to see medical services coming to them.
(Clifton Park and Halfmoon had a combined 61,171 residents by the 2018 Census estimate, compared with 97,279 in Albany, 65,575 in Schenectady, 49,374 in Troy, 28,005 in Saratoga Springs and 14,348 in Glens Falls, each of which is home to one or more hospitals.)
The healthcare industry’s rapid move to add outpatient hospitals has created a profusion of new storefronts and standalone medical buildings — so much so that one may be reminded of the early 2000s, when state officials decided the market was saturated to an unhealthy degree amid rapidly rising healthcare costs and created a commission to shut down or consolidate hospitals and nursing homes that were underutilized and/or financially weak.
In 2006, the Commission on Health Care Facilities in the 21st Century (popularly known as the Berger Commission for its chairman) issued a final report recommending closure of nine hospitals statewide and reconfiguration of 48, plus additional closures of nursing homes.
The commission bluntly warned that duplication leads a money-wasting “medical arms race” and unnecessary treatments as hospitals try to pay for their expensive equipment.
Milton left a Connecticut hospital in 2008 to become chief operating officer at Ellis Hospital right in the throes of this process, as Ellis was absorbing St. Clare’s Hospital and Bellevue Woman’s Hospital at the urging of Berger, forming what is now Ellis Medicine.
Milton said he could imagine a point in the future where continued proliferation of medical facilities might lead to the state forming another closure commission, but he suspects it would be more limited in scope, targeting certain markets rather than the state as a whole.
The Capital Region wouldn’t be one of those markets, as it is not over-served, Milton predicted. “I don’t think there’s a lot of extra capacity,” he said.
Generally speaking, the decentralization of medical services from cities to suburbs is driven by three factors: Patients’ desire to be treated closer to home; healthcare providers and insurers looking for less expensive settings than hospitals to treat patients; and the desire of healthcare providers to establish relationships with (and bill for services to) a distant population that has more money and better health insurance than city residents have, on average.
This is a trend nationwide and statewide as well as in the Capital Region, according to the Healthcare Association of New York State, which represents non-profit hospitals.
Factor in the increased emphasis on preventative care and community wellness (aimed at making patients healthier and saving money for all sides, patient, provider, insurer alike) and the push for a physical presence in multiple locations is greater still.
Consider also that Clifton Park/Halfmoon is one of the few places adding population in upstate New York, and that more older people are spending at least part of their year here after retirement, when they’ll need more medical care.
The business model is apparently working in Clifton Park:
Ellis Medicine’s Clifton Park Medical Center has the full-time equivalent of 94 employees who treat more than 30,000 people a total of nearly 50,000 times a year. Thousands more patients seek treatment each year at the other medical practices that lease space in the sleek Sitterly Road building Ellis opened in 2012.
Less than two miles north, Community Care Physicians in 2016 opened a 44,000-square-foot facility combining numerous medical specialties under one roof along Route 9. All told, in the wake of a merger with CapitalCare Medical Group, Community Care has 14 practices at three locations in Clifton Park, and they saw approximately 147,000 patient visits in the past year.
There’s also the three-building complex on Route 146 that Albany Medical Center built this year; several offices Albany-based St. Peter’s Health Partners operates in town; a medical arts building on Plank Road; and an array of smaller facilities, everything from physical therapy suites to a medical marijuana dispensary (just over the line in Halfmoon).
Chamber of Southern Saratoga County President Pete Bardunias lives, works and sees doctors in Clifton Park. The town, he said, has experienced an “amazing” amount of growth in the medical field in a very short period of time.
“It’s basically reflective not only of population growth but a strong economy,” he said. “Conditions are good here to have a profitable enterprise.”
The town is no longer just a bedroom community, Bardunias added.
“People want to live somewhere they feel comfortable. Obviously Clifton Park has done an amazing job keeping the cost of living down. The gripe was always that they didn’t have the services.”
He noted that the proliferation of medical offices has been mirrored by the growth of other services, most notably hotel space, which made a similar jump from minimal to numerous in relatively few years.
“Fortunately in this part of the world we have good services now,” Bardunias said. “Even the idea that I can use the term ‘Downtown Clifton Park’ and people won’t laugh … I think what you’re seeing is just a phenomenon now, Clifton Park and Halfmoon and the surrounding area just has so much going on it just makes sense.”
One other healthcare industry trend reflected in Clifton Park is collaboration — multiple entities joining to build facilities and share the costs of infrastructure. An example of this is the consortium behind the facility that will be built on Route 9: Albany ENT & Allergy Services, Albany Gastroenterology Consultants, Capital Cardiology Associates, Capital District Renal Physicians, CDPHP and OrthoNY. It’s a working partnership, not an affiliation or merger, but there have plenty of the latter in the last dozen years, even without Berger prompting.
Counting every form of affiliation, HANYS said, only about 15 percent of New York hospitals are independent today, down from about 50 percent a decade ago.
It’s a matter of survival — a bigger organization can leverage lower prices from its suppliers and higher reimbursement from insurers, which is critical as healthcare prices grow faster than the rate of inflation year after year.
If the recent decision by Glens Falls Hospital to affiliate with Albany Med goes through, Ellis Medicine will be one of only two independents left in the greater Capital Region, along with Nathan Littauer in Gloversville.
Ellis Medicine journeyed well down the path to an affiliation of its own in recent years, reaching advanced negotiations with an undisclosed facility before deciding to remain independent. But it continues to actively seek collaboration, Milton said, most recently agreeing to host an embedded CDPHP patient care management team at its headquarters, Ellis Hospital.
Milton still expects future expansion at the 11 acres on Sitterly Road that was to be the site of the surgical center. And he said it may well be in collaboration with another entity, such as a physicians’ group.
It just won’t be a surgical center, as Ellis has determined market conditions are no longer right for one.
“We’ll look at other opportunities,” he said.