SPRINGFIELD — State regulators on Tuesday approved the details of an $89 million project that will modernize facilities — but cut beds — while radically altering the face of the HSHS St. Mary’s Hospital campus fronting Lake Decatur.

The massive project to overhaul the campus would see medical/surgical beds cut by 58 from 88 to 30, and intensive care beds sliced by eight from 14 to six.

Illinois Health Facilities and Services Review Board Administrator John Kniery confirmed Tuesday evening the request had been approved.

The Illinois Health Facilities and Services Review Board noted that Hospital Sisters Health System, the hospital's parent company, has said there will be no reduction of jobs tied to the loss of beds because no reduction in services is intended.

“...Beds are only being reduced to remove excess capacity and space,” said a review board background report.

“The applicants (HSHS) state the hospital intends to provide the same level of services that it now provides, but in modernized and more efficient space.”

That assurance, however, comes in the wake of deep service cuts which the review board has already OK’d. In June it unanimously approved a HSHS request to close St. Mary’s advanced inpatient rehabilitation facility, its obstetrics and newborn nursery, pediatrics and inpatient behavioral health services.

And the new project, expected to be completed by September 2026 if approved, will also involve the demolition of much of the iconic main hospital building towering over the lake, which dates to 1961. Some 219,000 square feet is due to be demolished while the modernization work will take in 105,000 square feet. Also slated for demolition is a medical building on the back side of the hospital and the walkway that connects it to the main building. 

The modernization will include an up-to-date medical surgical department, intensive care unit, operating rooms and recovery stations and a revamped medical office building.

HSHS says what's driving all this is St. Mary’s own acute financial condition which has seen it lose $62 million since 2018. HSHS also cites what it portrays as the harsh realities of Decatur’s own prognosis. The medical group says the city has been losing population at the rate of 1.23% a year — down 3.65% since the 2020 census — while the poverty rate among those who remain is running at 19.7%


That assessment of the city’s health got some pushback from Deputy City Manager Jon Kindseth, who nevertheless welcomed HSHS plans to sink more money into upgraded services.

“Certainly, we want a modernized medical facility and if newer technology allows them to treat and provide care in a more efficient and effective manner so that they need less beds, then we certainly support it and we support the investment in our community,” he said.


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“Where I disagree is that this is a shrinking community that will continue to shrink. I don’t have the specific numbers on our population growth since 2020, but we fundamentally believe our population has grown since 2020 and has not continued to decline.”

Kindseth faulted unreliable Census figures which he said, since 2020, are based more on projections. “At the end of the day we know we’ve added 800 new jobs since 2020, which means we’re talking a minimum of 600 or 800 new households here which is going to drive demand for more health care needs in the community,” Kindseth added.

He acknowledged that his city had seen a “significant” fall in population between 2010 and 2020, but again insisted that was being reversed and those tasked with providing future services needed to take the change into account.

“We know the city of Decatur is now on the rebound and not on the decline, and so hopefully HSHS is setting themselves up for the future and not looking in the rearview mirror while trying to plan for that future,” Kindseth said.


The state review board had noted that it had received no “letters of opposition” to the HSHS plans for St. Mary’s and no public hearing had been requested. It also noted and copied into its files eight letters of support, including letters from state Rep. Sue Scherer, D-Decatur, and state Rep. Dan Caulkins, R-Decatur.

“Through this modernization project, HSHS St. Mary’s seeks to fulfill its mission — to both its staff and the community — by reimagining its healthcare services to continue providing high quality services despite financial pressures from medical advancements that reduce hospital stays, shortages within the healthcare workforce, and a declining population in the region,” wrote Scherer.

Caulkins lauded the fact the project would add “four new, substantially larger operating rooms” while also modernizing pre and post-surgery areas. He said it would also upgrade technology and equipment and restructure the hospital layout and operations to minimize delays in patient surgeries. Both Scherer and Caulkins mentioned reaching their conclusions after being taken on a recent tour of the hospital campus.


“This $89 million investment will ensure the hospital remains a strong member of the Decatur community, and I support approval of the application,” Caulkins wrote.

Decatur-based Crossing Healthcare also wrote in support as did the Decatur Regional Chamber of Commerce. “...St. Mary’s is one of the top employers in Decatur and continues to take measures to recruit and retain experienced healthcare providers to the hospital,” wrote Mirinda Rothrock, the Chamber president.

“We are grateful for the planned modernization of St. Mary’s Hospital in order to adapt how it delivers healthcare services to best serve the residents of Decatur-Macon County…”