Ochsner Health System is working with GraceHebert Architects to design their new Baton Rouge "Microhospital"

Located in the heart of the Baton Rouge Health District, Ochsner Health System's new medical office building will provide outpatient services, and primary care and specialty clinics.

Ochsner getting serious about expansion into Baton Rouge market

Baton Rouge Business Report

June 8, 2017

Ochsner Health System is announcing details this morning of a major expansion into the Baton Rouge market—a $100 million clinic and “microhospital” that will be located in The Grove, a mixed-use development just off Interstate 10 between Bluebonnet Boulevard and Siegen Lane.

The facility, when completed in 2019, will include a five-story, 155,000-square-foot medical office building with outpatient services, and primary care and specialty clinics. It also will include a 30,000-square-foot, “microhospital”—a small, 10-bed, inpatient unit and surgical center that will be able to perform general, ENT, orthopedic, gynecology and urology surgeries.

In April, Ochsner officials confirmed plans to build on the 24-acre site, located in the heart of the nascent health district, but were short on details. Today’s announcement suggests the New Orleans health care giant is aggressively going after new business in Baton Rouge.

“In a rapidly changing world of health care, it is essential to offer new models of care like the microhospital concept,” says Ochsner CEO Warner Thomas. “This is about demonstrating our long-term commitment to Baton Rouge, Denham Springs, Zachary, Iberville, and the patients and our teams who are proud to call every parish across the Baton Rouge area home.”

The announcement, under way at this hour, coincides with the opening today of the expanded Ochsner Baton Rouge Cancer Center, another major investment by health care giant in the market. The facility is located on the campus of Ochsner Medical Center-Baton Rouge, Ochsner’s local acute care hospital on O’Neal Lane and Interstate 12.

The new cancer center will offer a hematology/oncology outpatient clinic with chemotherapy and radiation oncology. It will double the space previously available to more than 20,000 square feet, including 15 personalized and semi-private patient chemo infusion stations, as well as exam rooms and a radiation vault with a state-of the art linear accelerator.

Taken together, the new cancer center and planned facility at The Grove signal Ochsner is aggressively going after the lucrative insured and private-pay patients, which will make life difficult for other providers in the market.

“They’re not building an emergency room, which is where you get your Medicaid and uninsured patients,” says Nate Kaufman, a national healthcare consultant based in San Diego, California, who has studied the local market. “They’re clearly trying to attract the private paying patients. So that will divide the market and it’s difficult to see how anyone other than Ochsner would win.”

Kauffman believes Baton Rouge is already an overbedded market, adding Ochsner’s focus on outpatient services is particularly wise because that’s where the growth in the healthcare sector is occurring. The institution already has 13 clinics in the local market and an established presence around the periphery of the region, so growing its footprint in the backyard of its competitors—Our Lady of the Lake and Baton Rouge General—and in the heart of the city’s health district is a bold move.

“They’re a formidable presence and to the extent they execute they are going to be very effective,” Kauffman predicts.

Ochsner officials say they expect to invest more in the local market. There is space on the 24-acre site at the Grove to expand the clinic and microhospital at some point in the future. Also, plans are in the works to expand two of the existing clinic locations and scout sites for additional new clinics.