Legislation would allow Children's to purchase shuttered NOAH property

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A newly amended state House bill, advanced by the state House Natural Resources Committee today, would allow Children's Hospital to purchase the shuttered New Orleans Adolescent Hospital for $29 million. Children's agreed to lease the property in January but balked at the terms of the agreement, which required that it reopen NOAH as a child and adolescent psychiatric hospital. The amendment strips that requirement for the sale but requires that Children's expand mental health services on its main campus.

The bill puts an end to a dispute between Children's — which has been trying to buy the property for a number of years — and state Rep. Neil Abramson, D-New Orleans. Abramson, who represents the district that includes NOAH, wanted the property reopened as a children's and adolescent psychiatric hospital. But Children's hoped to use the NOAH site for additional ambulatory outpatient clinics, a surgical center, as well as new radiology and lab facilities, Children's marketing vice president Brian Landry said.

Children's Hospital met with Rep. Abramson and reached a compromise requiring that it provide expanded child mental health treatment, likely on its main campus adjacent to NOAH, Landry said. Under the newly amended bill Children's would not be required to reopen NOAH for children's and adolescent mental health services. The bill would, however, require that Children's expand mental health services, opening 16 new children's and adolescent beds, possibly on the hospital's main campus.

"We're very pleased with the bill," Landry said. He said the sale price for NOAH will be $29 million. The new bill also provides for $10 to $20 million in state capital outlay funding, which will likely help pay for the mental health expansion. "Children's plans to put $50 million to $60 million into the NOAH campus just in the next several years."

The bill also requires Children's to develop the following:

(1) Behavioral health care services for children under five years of age.
(2) Expansion of the Autism Center at Children's Hospital Campus.
(3) Expansion of the Audrey Hepburn Children at Risk Evaluation Center.
(4) Expansion of the Parenting Center related to mental health care.

Children's has long sought to purchase the property, adjacent to its main campus, to provide expanded treatment. But the hospital was unwilling to adhere strictly to the terms of the agreement, which, pursuant to a state law, would only allow the lease of the property if Children's reopened it as a psychiatric hospital. The new amendment replaces an Abramson-sponsored bill that would have offered the lease to Ochsner Health Systems if Children's refused to comply in full.

The law mandated that Children's sign the lease by Feb. 1, 2013, or relinquish its right of first refusal for the property. Children's signed the lease on Jan. 25, but Children's representatives later said they signed only to continue negotiations on a sale.

Abramson, who did not immediately return a request for comment, sent a press release on the amended bill.

(Press release after the jump)


ABRAMSON ANNOUNCES INCREASED MENTAL HEALTH SERVICES IN TRANSFER OF NOAH TO CHILDREN’S HOSPITAL

State Representative Neil Abramson said an agreement has been reached with Children’s Hospital whereby the existing lease for the New Orleans Adolescent Hospital (NOAH) property will be converted to a sale.

Children’s has agreed to provide extensive additional mental health services for children and adolescents, to include:

More in-patient beds.

A new program to treat children from birth to five years.

An expanded autism program.

A transitional program from in-patient to out-patient services.

The State will also re-allocate money which was set aside last year for NOAH and related mental health care facilities to Children's Hospital. In exchange, Children's Hospital will in good faith consider and plan additional services, including:

Drug and alcohol addiction programs.

Day treatment services.

Longer-term in-patient care with educational and therapeutic services.

Devices for children in the juvenile justice program.

Children’s had stated that the terms of the lease it signed were too restrictive and it did not intend to use the NOAH buildings or match the services required in the lease and in Abramson’s related legislation.

Abramson said, “It is important to the entire community that that these services be provided locally, and that Children’s will now have the resources to add desperately needed care.”

The long-term 99-year lease previously executed by Children's Hospital for the NOAH property will be converted to a sale, with final details still in progress. Rep. Abramson will hold a community meeting to discuss the process.

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