Health First scales back Merritt Island Wellness Village concept but new hospital still on the way

The wellness village concepts in Palm Bay and Melbourne have been paused, but nothing has been cancelled yet.

Health First scales back Merritt Island Wellness Village concept but new hospital still on the way

Health First has made some changes to the concept of its Wellness Village in Merritt island.

Rockledge, a nonprofit health system, will eliminate some retail elements from the project it is proposing at 255 Borman Drive on Merritt Island. The project still includes a 120-bed facility to replace the 150-bed Cape Canaveral Hospital, in Cocoa Beach. It also includes a 90,000.0-square-foot medical building, parking structure, and a central energy system. However, concepts such as a restaurant or coffee shop, a health information center, and retail shops are no longer included.

Why it matters: The construction of health care facilities creates permanent jobs, and offers opportunities for contractors.

Health First Spokesman Lance Skelly said to Orlando Business Journal the decision was influenced by the increasing costs of labor, materials and energy as well as transportation, construction, and transportation.

"Health care systems, hospitals, and grocery stores cannot raise or adjust their prices to respond to external pressures, like an airline, theme park, hotel, or restaurant can," Skelly stated. Skelly said that due to the rapidly rising costs and no signs of a slowdown, they have decided to reevaluate their Wellness Villages, including Merritt Island.

Construction on the hospital, as well as other components, is expected to begin in 2024. Demolition of the Borman Drive site has already begun. The Wellness Villages in Melbourne and Palm Bay were paused to reevaluate the sites, and nothing was taken off of the table, said Skelly.

Health First's bond report for the fiscal year ending Sept. 30, 2018, shows that it reported a loss of $232.5 in fiscal 2022, compared to a gain of $189.3 in fiscal 2021.

Health First, founded in 1995, has over 9,000 employees, owns four hospitals and health insurance plans, and is a multispecialty doctor group.

Construction of health care facilities is increasing in Central Florida and across the country.

FMI Corp., based in Raleigh, North Carolina, expects that health care construction expenditures in the U.S. will go from $53 Billion in 2022 to $60 Billion in 2025. This is because of an aging population, and the additions of people in certain areas of the country.

Michael C. Brown told Orlando Business Journal, executive vice president of Skanska and general manager of Florida building operations, that the health care construction industry is expected to remain hot in Florida and Orlando.

Brown stated that despite the economic downturn, "health care is still a strong sector." Florida has seen an influx of resources and people due to the migration. The need for inpatient beds continues to be driven by this, and other factors.