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Louis Jacobson
By Louis Jacobson January 14, 2013
← Back to Rebuild hospitals in New Orleans

Federal government is helping fund three hospital projects

Hurricane Katrina struck the Gulf Coast three and a half years before Barack Obama was sworn in as president, but the recovery lagged so much that Obama made several Katrina-related promises during his presidential candidacy in 2008.

One of the promises was to rebuild hospitals in New Orleans, including "a major medical complex in downtown New Orleans that will serve the entire community” and "a new, state-of-the-art Department of Veterans Affairs hospital."

First, some background. Before Katrina, Orleans Parish -- that is, the city of New Orleans -- had nine hospitals, and next-door Jefferson Parish had seven. A number of these facilities were private community hospitals largely serving residents with insurance. Charity Hospital, a large, Art Deco facility, served the city's poor -- nearly three-quarters were African American and 85 percent earned less than $20,000 a year. Half of the inpatient care at Charity was for patients without insurance, compared with 4 percent at other city hospitals.

Damage from Katrina closed Charity Hospital and most of the city's other hospitals, at least initially. (Only three, all in Jefferson Parish, operated through the storm and its aftermath.) One year after the storm, only three of nine Orleans Parish hospitals were serving patients, many of them with limited capacity. In the entire metropolitan area, the number of beds fell from 4,083 to 1,971 by July 2006.

Louisiana State University, which ran Charity, opened up a temporary emergency room, clinics and a trauma center -- but the hospital's permanent fate became subject to a legal dispute over whether to renovate or rebuild. The Federal Emergency Management Agency estimated that repairing the structure would cost $23.9 million, but the university countered that it would cost $257 million. This led the university to propose building a new facility rather than renovating the old one.

In January 2010, the dispute was resolved by an arbitration panel, which ruled that FEMA had to pay $475 million toward the full rebuilding of Charity. Construction began on a new facility in February of 2012.

The effort to rebuild Charity accounts for one element of the federal government's post-Katrina hospital recovery under Obama. There are at least two others.

One concerns the $110 million project to replace Pendleton Memorial Methodist Hospital in New Orleans East. In June 2012, the project received an $8.4 million FEMA hazard mitigation grant to ensure the structural safety of the hospital in the event of a natural disaster. Then, in October 2012, the Department of Housing and Urban Development said it would back a $97.6 million mortgage for the project. The facility is projected to open by the end of 2013.

The other federal effort aimed at supporting this promise concerns the rebuilding of a major VA hospital damaged by the hurricane. The facility is designed to be state-of-the-art, especially in its resilience in the face of a natural disaster. Critical infrastructure, including the emergency room, will be on the fourth floor so it can better survive a flood, while patient rooms will be flexible to accommodate more occupants in a pinch. The facility will store enough fuel for a full week and can collect over a million gallons of rainwater on site, in case the city supply is contaminated. It will have a securable perimeter in the event of "civil unrest or national emergency.”

Taken together, all of these actions amount to a Promise Kept.

Our Sources

Health Affairs, "Health Care In New Orleans Before And After Hurricane Katrina," August 2006

Alliance for Health Reform, "Rebuilding Louisiana"s Health Care System," July 2007

Hospitals & Health Networks, "Louisiana"s Second Chance," February 2007

The Nation, "Why Was New Orleans's Charity Hospital Allowed to Die?" April 27, 2011  

City of New Orleans, "Mayor Landrieu Announces Progress on New Orleans East Hospital," June 28, 2012

Healthcare Construction & Operations, "New Orleans" Hurricane-Proof VA Hospital," Aug. 08, 2012

New Orleans CityBusiness, "HUD backs city"s mortgage to build eastern New Orleans hospital," Oct. 1, 2012

New Orleans Times-Picayune, "Former LSU hospitals head takes Medicaid critique to national stage," Dec. 18, 2012

United States Civilian Board of Contract Appeals, decision in Charity Hospital case, Jan. 27, 2010

Humid Beings blog, "FEMA to award $474,750,898 to rebuild Charity Hospital," Jan. 27th, 2010

NBCNews.com, "After irate Sandy rhetoric, long funding process awaits," Jan. 5, 2012

Interview with Frederick P. Cerise, associate clinical professor of medicine at Louisiana State University and former head of LSU"s public hospitals, Jan. 11, 2013