Ken Carlson

Modesto physician building a local specialty care empire

The former City Hospital at 17th and H streets was revamped three years ago to create Central Valley Specialty Hospital.
The former City Hospital at 17th and H streets was revamped three years ago to create Central Valley Specialty Hospital. Modesto Bee file

Gurpreet Singh, a Modesto physician and investor in long-term care facilities, has not rested since revamping the former City Hospital on 17th Street to create Central Valley Specialty Hospital three years ago.

Late last month, his project to expand the Avalon Care Center on East Orangeburg Avenue from 70 to 202 beds received approval from a Modesto zoning board. Under the plan, the center will triple in size to almost 45,000 square feet and displace the blighted Casa Blanca Court to the north.

Singh’s company, American Specialty Healthcare, has purchased Avalon to convert the nursing center for “subacute” patients, who are too ill for skilled nursing care or are dependent on ventilators.

Singh’s newest project is a 174-bed rehab hospital proposed on Healthcare Way, just west of the Kaiser hospital in north Modesto. Singh submitted a development plan application to city planning in March. The city said the plan is consistent with the zoning and only requires staff review.

Gia Smith, who manages Central Valley Specialty Hospital, does the talking for the emerging company while Singh stays in the background. Smith said the north Modesto facility will provide rehabilitative and skilled nursing care for patients.

“Once we get everything approved, our goal is to start building in the fall and we are looking to open in the fall of 2017,” Smith said.

She said American Specialty Healthcare will invest about $20 million in the rehab hospital and $10 million in expansion of the East Orangeburg center, with the financing coming from Tri Counties Bank.

Another application to the city would put a senior living center near the proposed rehab hospital in north Modesto. RJ Development has a plan for a memory care and independent senior living facility on the east side of Dale Road, where an extension of Healthcare Way is planned.

Smith said there’s a local need for medical rehab and subacute care, but other trends are driving investment in these types of facilities. Besides the growing number of retirement-age residents in the Northern San Joaquin Valley who will need hip replacements or struggle with chronic illness, patients are spending less time in regular hospitals before they’re moved to short-term rehabilitative care.

In addition, acute-care hospitals face financial penalties for Medicare patients who are readmitted within 30 days of being discharged. “We can help the hospitals not be penalized for the 30-day rule,” Smith said.

American Specialty Healthcare expects that some of the patients for the north Modesto rehab center will come from outside the county. The location near Kaiser has access to Highway 99.

Another player has invested in Modesto to provide inpatient rehabilitative care. The Alabama-based HealthSouth Corp. has built a 54,000-square-foot acute rehab hospital at the northeast corner of Coffee Road and Mable Avenue. The 50-bed facility is designed for patients recovering from surgery, a major illness or injury.

Singh’s other investments downtown, near Central Valley Specialty Hospital, include a remodel of the county’s former Medical Arts Building, at 17th and G streets, for a corporate office and physician offices, and a home health and hospice service at 1619 H St.

Smith said when the different projects are completed, American Specialty Healthcare could have about 1,200 employees.

Ken Carlson: 209-578-2321 @KenCarlson16