The need to recruit mental health care providers amid an acute staffing shortage, the addition of more outpatient capabilities, and inflation’s effects on construction materials combined to drive up the price for a new pediatric center at Pine Rest Christian Mental Services.
The project that Pine Rest wants to develop in partnership with Corewell Health’s Helen DeVos Children’s Hospital originally carried a $62 million estimated cost. The cost estimate has since grown to $86 million, an increase that includes about $6.2 million to recruit mental health professionals to Grand Rapids that are in short supply nationally.
“There’s plenty of beds, there’s not plenty of staff, and that’s been the primary problem,” Pine Rest Vice President and Chief Operating Officer Bob Nykamp told Crain’s Grand Rapids Business. “We’re partnering to try to bring in a whole bunch of new experts from outside of the state of Michigan into the state of Michigan in this project, so there’s a lot more dollars allocated to workforce development than we had in our original plan.”
Pine Rest could steer the money to recruit direct-care staff to offering assistance to pay off college debt, helping with relocation costs, and providing sign-on bonuses, Nykamp said.
When it opens, the Pediatric Behavioral Health Center of Excellence on Pine Rest’s 68th Street campus in Cutlerville will include psychiatric urgent care, a crisis stabilization unit, and specialty outpatient clinics to prevent mental health crises for conditions such as depression, anxiety and eating disorders.
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In late May, Pine Rest filed a letter of intent with the Michigan Department of Health and Human Services that begins the regulatory approval process for the project. Pine Rest plans to file a full application to the state this week seeking an expedited project review, which normally takes up to six months.
Pine Rest hopes to complete the review process and secure approval from the state in time to begin construction this fall and open the Pediatric Behavioral Health Center of Excellence in late 2025, Nykamp said.
“This is a sense of anxiousness that we have to get this done as soon as possible,” he said.
Pine Rest and Helen DeVos Children’s Hospital have been planning the pediatric center since 2018 and publicly unveiled their plans in July 2022. Directors at Pine Rest decided to refine and expand on the original plan, including adding more outpatient capabilities and capacity to meet growing demand for mental health care that accelerated during the pandemic, Nykamp said.
“They basically challenged us: ‘You know what? The minute you open it, you’re going to say it’s too small,’” he said. “The numbers since COVID have only gotten worse in terms of the demand for kids’ services and the clog in the system statewide.”
Getting an outpatient appointment with a psychiatrist at Pine Rest can now take up to 150 days and the wait time for a psychological assessment for Attention-Deficit/Hyperactivity Disorder (ADHD) is about 250 days, Nykamp said.
The refined plans for the Pediatric Behavioral Health Center of Excellence would expand Pine Rest’s child and adolescent outpatient capacity by about 50% over what was previously planned, Nykamp said. The plan also expands the number of child and adolescent inpatient beds from 36 to 76.
The additional outpatient capacity and capabilities will go for specialty mental health care to treat issues such as eating disorders, substance abuse, developmental disabilities, and neuropsychology, according to Nykamp.
Beyond talent recruitment and the additional outpatient capacity, inflation also has driven up construction estimates by 30% to 40%, adding further to the overall project cost, Nykamp said. Inflation could add $10 million to $15 million to the final cost of the project, although “this is only a hypothetical projection as we will not begin receiving bids until later this summer,” he said.
Pine Rest seeks to finance the project with a combination of state funding and philanthropy.
The state committed $36 million toward the project and Pine Rest looks to raise up to $50 million through an ongoing capital campaign that Nykamp said is presently in its “quiet” phase with appeals to potential major donors across the state.
So far, Pine Rest has secured “significant millions of dollars in pledges from the great philanthropists in the West Michigan area and actually statewide since it’s really going to serve kids from all over the state,” Nykamp said. Organizers hope to have a “significant portion” of the capital campaign wrapped up by September, he said.
“It’s going very well,” he said of the capital campaign. “We’ve had so many people say to us over the years, ‘Hey, when you do something for kids, come see us.’ That’s exactly what we’re doing.”
Pine Rest and Corewell Health each plan to seek grants for the project from funding that state legislators and Gov. Gretchen Whitmer appropriated last year, Nykamp said. The state’s present fiscal year budget allocated $50 million for competitive grants to expand pediatric psychiatric capacity across Michigan. The Michigan Health & Hospital Association administers the grants.
Lawmakers last summer initially earmarked $50 million for the project in a budget deal with the governor. Legislators later reduced that amount to $38 million with the understanding that Pine Rest could apply for grant funding from the state money appropriated for pediatric mental health care, Nykamp said.
