Officials pose for a photo Tues., June 6, 2017, during the ground breaking ceremony at the site for the new Erlanger Children's Hospital on Third Street in Chattanooga, Tenn. The $40 million, three-story building on the corner of Third and Palmetto streets is scheduled to open in 18 months.

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Erlanger breaks ground on new children's hospital

One of the first things Erlanger Health System CEO Kevin Spiegel did after he was hired in 2013 was tour the T.C. Thompson Children's Hospital.

He and Dr. Alan Kohrt, the children's hospital's chief medical officer, agreed the roughly 40-year-old building that's part of the main Erlanger campus was outdated and needed to be replaced — especially considering the mean age of U.S. children's hospitals is 6 years.

"But it was at a time when we were not financially sound," Spiegel told a crowd of hundreds gathered at the corner of Third and Palmetto streets Tuesday morning for the groundbreaking of the new Erlanger Children's Hospital outpatient building. The $40 million, three-story structure is scheduled to open in 18 months.

"You want to start planning and building a hospital when we could not take two nickels and rub them together?" Spiegel remembered an employee asking him.

Spiegel, who's credited with reversing a $36 million loss at the hospital from 2008 to 2013 resulting in a $37.3 million profit for fiscal year 2015, told the crowd that Erlanger is poised to realize its vision for a children's hospital.

"We did get through our financial blip," he said, promising, "Pediatrics is going to be our signature department."

Kid-friendly design

When finished, the outpatient building will have Chattanooga-centric, kid-friendly touches such as an 1891 steam locomotive out front, hang gliders from Lookout Mountain inside and a tow truck on the third floor — since Chattanooga was the birthplace of the towing industry.


Spiegel gave credit to Bruce Komiske, Erlanger's vice president of new hospital design and construction who spent his career traveling around the world to help build children's hospitals, including the 23-story Ann & Robert H. Lurie Children's Hospital in Chicago. Komiske's trademark is to add fun, local touches at each of his hospital projects.

The new children's hospital has gotten $20.5 million in financial donations from some 4,500 people, including $4 million from an anonymous donor and paycheck deductions from hospital employees. More than half of the employees have donated, Erlanger officials said.

The hospital pitched in another $11.5 million from bonds it refinanced in 2015, which means a total of $32 million has been raised to date and $8 million is still needed.

"Keep it coming," Spiegel said. "Because we need to realize the total vision."

Other speakers at the groundbreaking included Dr. Kohrt, who praised Julie Taylor, the president of the hospital's foundation, for leading fundraising efforts.

They include an April fundraising gala, the Believe Bash, a black-tie event that drew some 900 people to the Chattanooga Metropolitan Airport and raised more than a half million dollars.

"[Previously] there was no culture of philanthropy at Erlanger," Kohrt told the crowd.


Catalyst for revived Third Street

State Rep. Mike Carter, R-Ooltewah, shared a story about someone in a restaurant telling him that Erlanger would never raise enough money to build the new children's hospital.

But Carter bet on the fundraising prowess of the campaign, which is led by Tom Edd Wilson, a former Chattanooga Area Chamber of Commerce president and CEO, and Grady Williams, who's worked for more than 50 years as a Chattanooga-area accountant and was named Fundraiser of the Year in 1999 by the Association of Fundraising Professionals.

"Do you know Grady Williams?" Carter said he told the doubter. "My money's on Grady."

The children's hospital should be the catalyst for new residential and retail development on Third and Fourth streets, said Kim White, CEO of the River City Co., which is working on a plan to revitalize the area as Chattanooga's "health and wellness corridor."

Also at the event was University of Tennessee head football coach Butch Jones, who didn't speak but waved at the crowd. Erlanger employee Diane Abercrombie got to ride in a limousine with Jones from the airport to the groundbreaking ceremony because she raised $1,225 in a special fundraising contest. Another Erlanger employee, Katie Edgemon, raised $1,005 and got to accompany the Vols football coach back to the airport in the limo.

Contact staff writer Tim Omarzu at or, on Twitter @meetforbusiness or at 423-757-6651.