Medicare is the single biggest payer for proton beam radiation therapy, so “it’s good news for the proton community,” said Leonard Arzt, executive director of the National Association for Proton Therapy.
But whether the payment boost creates a more hospitable investment environment for proton therapy remains to be seen. Financing challenges loom for both the Kettering project and a proton beam radiation treatment center announced in late 2009 by Optivus Proton Therapy. Optivus plans to build the center at the southwest corner of the Interstate 75-Austin Boulevard interchange in Miami Twp.
California-based Optivus has encountered challenges in financing its $170 million project, to the point that the project has been scaled back to $100 million to $125 million, according to a Miami Twp. trustee.
“You have to take baby steps before you can take big steps,” said Mike Nolan, the township trustee. “In this economy, people are very careful about where they’re investing.”
When Kettering Medical Center officials announced their proton beam therapy project in May 2010, they said financing was in place — a statement they stood by for the next year.
But on Thursday, Walter Sackett, Kettering’s vice president of clinical services, sounded more cautious about financing. He said financing has become less available and more expensive, he said, adding that KMC wants to explore possible sources of philanthropic support for the project.
Finding such support is “absolutely essential for this project,” Sackett said.
Kettering Medical Center and its parent, Kettering Health Network, have often relied on donors to help fund significant capital projects. Raj and Indu Soin gave at least $10 million toward the hospital bearing their name in Beavercreek — the exact amount was not disclosed — surpassing the largest previous gift received in KHN’s history: $8 million from Oscar Boonshoft. Benjamin and the late Marian Schuster gave $5.5 million toward the heart hospital at Kettering Medical Center that bears their name.
KMC’s proton therapy project will be part of a comprehensive cancer center in which KMC plans to invest $80 million to $90 million. ASHS is paying $50 million for the proton therapy equipment, bringing the comprehensive cancer center’s total cost to about $140 million.
Sackett earlier this year told the Dayton Daily News that ASHS had selected Palo Alto, Calif.-based Varian Medical Systems Inc. as the equipment vendor. But he stepped back from that statement on Thursday, saying a final decision has not been made.
“As technology continues to advance, the cost is going down with some systems,” prompting KMC and ASHS to give further consideration on who to select as a vendor, said Craig Tagawa, ASHS’ chief operating officer.
Tagawa expressed confidence that the project will move forward. “We feel very confident that the project’s a financeable project,” he said.
KMC’s efforts to finance the project come as Kettering Health Network, finishes construction of the $135 million Soin Medical Center, which is scheduled to open in February. It is also in the midst of spending $100 million to convert its hospitals to a single electronic medical records system, and is working to make its Fort Hamilton and Greene Memorial hospitals profitable following recent losses at both facilities.
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