When Chuck Jensen needs a check-up, rather than driving out of town, he takes advantage of the medical treatment Fall River Health Services provides in Hot Springs.

A diagnostic test performed at the Fall River Hospital recently helped Jensen's physician, Dr. Art Raymond, diagnose a gall bladder problem.

Having medical treatment available at home saves a trip out of town, which "is very important" for Jensen, 77, and his wife, Lillian.

Meeting the needs of people like the Jensens is only one of the reasons that Fall River Health Services wants to build a new $15 million hospital.

The current 11-bed hospital is in a building that is more than 50 years old. Although the building is structurally sound, it cannot accommodate today's medical technology, administrator John Miller said.

"We're busting at the seams here," Miller said.

In addition to Fall River Hospital, Fall River Health Services operates Fall River Rural Health Clinic and the adjacent Castle Manor Retirement Home, a 48-bed nursing home.

Health care in Hot Springs has changed considerably in the past 10 years.

Banner Health closed the hospital in 1998. The closure of the nursing home and an assisted-living center was looming when a group of local residents formed a nonprofit corporation to open an urgent-care clinic and save the nursing home, Miller said.

With the assistance of Gov. Bill Janklow, the Greater Fall River Health Services secured a Community Development Block Grant to buy the hospital and nursing home from Banner. The $150,000 grant bought the buildings for $75,000 and repaired a roof.

In his conversations with the board, the governor insisted that the board include skilled business people.

"Janklow told us to run it like a business and make good financial decisions," Rich Olstad said. Olstad served on the original board and is now vice-president of the Fall River Health Services board of directors.

Miller was hired in 1999, and under his leadership, the hospital was reopened in 2001.

"It's been quite a road," Miller said. "It's been a teamwork effort."

The community uses the services and recognizes the need for the nursing home, Miller said.

"Today, we have a staff of 150 and a $5 million payroll," Miller said. The nursing home averages 47 residents.

In addition to Dr. Raymond, a physician assistant and nurse practitioner work in the clinic.

Emergency-room duties are shared by three contracted physicians.

Visiting doctors bring additional medical services, including outpatient surgery, to the community.

Fall River Hospital has also benefited from its designation as a critical access hospital.

When it opened in 2001, the hospital was the first in the state to open as critical-access hospital, Olstad said.

With the nearest hospitals located in Rapid City, Custer and Chadron, Neb., the critical-access hospital designation recognizes the hospital's importance as a primary health-care provider for the area's elderly and rural residents.

Hot Springs has a growing population of retirees who are strong hospital users, Nelson said. Reimbursement rates on hospital stays at critical-access hospitals are higher than for acute-care facilities, he said.

Following Gov. Janklow's advice, Fall River Health Services has brought its facilities into the black, attracting customers by improving and expanding its services.

"It's not all about making money," said Rich Nelson, president of Fall River Health Services board of directors. "We're trying to service the community, but we have to make money or we can't continue."

Discussions about remodeling and expanding the current hospital began about five years ago.

It quickly became apparent that the hospital's location, on a cliff overlooking the community with a school across the street, is somewhat "land-locked," Olstad said.

Heating, cooling and utility systems would also require costly upgrades to accommodate any additions.

"When you're looking at spending half as much on renovations as a new building, it becomes tough," Olstad said.

The board considered replacing Castle Manor, which was built in 1917, Olstad said.

Current reimbursements from Medicare and Medicade, however, do not make it practical to rebuild the nursing home.

Two years ago, former resident Bill Cox gave Fall River Health Services almost 12 acres on the southern edge of Hot Springs. Cox specified that a groundbreaking take place by March 2008. He recently granted a six-month extension.

Valued at almost $1 million, the gift and capital reserves make it feasible to build a new hospital, Miller said.

Fall River Health Services representatives met two weeks ago with the Department of Housing and Urban Development in Washington, D.C., to outline their plans. A HUD guaranteed loan would help secure financing for the hospital.

The City of Hot Springs and local contractors are working on a cost saving plan to bring water and sewer services to the site, Miller said.

Final designs must be completed in the next few months, before a final application is submitted to HUD.

For Jensen, who hasn't "been incarcerated there for a while," the idea of a new hospital is appealing.

"I think it's a necessity," he said. "I hope they can do it."

Contact Andrea Cook at 394-8423 or andrea.cook@rapidcityjournal.com