Michigan’s Certificate of Need Commission last week voted unanimously to change one of its CON rules to require that a group of regional hospitals work together on a controversial new proposal to build a high-tech cancer treatment center in Oakland County.
The state’s decision came after Oakland-based William Beaumont Hospitals lobbied for approval to build a new proton-beam cancer therapy center on its Royal Oak campus, as well as a new medical school at Oakland University. Beaumont has said it would partner with an Indiana-based for-profit group to build the center, but critics said the plan would set off what one hospital official called an “arms race” among hospitals for the expensive new technology.
The CON commission named nine regional hospitals as part of the consortium, based in part on whether they see more than 30,000 cancer radiation patients a year. Several of the hospitals — including the Henry Ford, Trinity, Ascension, and University of Michigan hospitals — favor the joint approach, according to local reports.
Under Beaumont’s proposal, the hospital would contribute $13 million to finance the project, with the rest coming from the Indiana firm, ProCure Treatment Centers Inc. Under the commission’s plan, the nine-member consortium must return to state officials by June to present a financing plan, and return again in September to present an overall business plan.
The commission can be overruled by the state Legislature or the governor.
The move could have an impact on the long-stalled plans to expand Detroit’s Cobo Center, which hosts the North American International Auto Show. Oakland County Executive L. Brooks Patterson recently linked approval of the proton project to his support for the Cobo expansion, which he has previously opposed, saying that the suburbs would end up paying more in taxes to support its operation.
The Cobo plan relies on roughly $600 million of borrowing. Under the plan, the state would create a new authority that would purchase the Cobo Center for $20 million from Detroit. It would have the ability to sell bonds for the upkeep and operation of the center. The project would in part be financed through liquor and hotel taxes, and the state would also create a sales-tax-free zone in an effort to attract more conventions.
