Rural Health System breaks ground on two hospital expansion projects totaling more than $50 million

(651) 602-7786

USDA joined Lakewood Health System and local community members in Staples, Minn. and Pillager, Minn. today to celebrate the groundbreaking of two hospital expansion projects totaling more than $50 million.

   “The commitment by Lakewood Health System to improve upon the quality of healthcare for the Staples and Pillager communities is important to recognize,” said Colleen Landkamer, USDA Rural Development State Director. “Solid infrastructure and modern healthcare facilities play a key role in the economic sustainability of rural communities – attracting new businesses, retaining population and providing opportunities for future growth.”

   With a service area of just over 18,000 residents across four counties, Lakewood Health Systems (LHS) offers a full range of medical services at four convenient locations.

   Since construction in 2004 and 2006 of the current Staples and Pillager facilities, LHS has added 57 physicians, specialists, and advance practice clinicians. This increase in primary and specialty care, along with a consistent increase in emergency services, has led to a need for expansion.

   With help from a $22 million direct loan to aid in construction costs and a $22 million direct loan for current debt refinancing through USDA Rural Development’s Community Facilities Program, LHS will be able to expand and remodel both facilities, including the hospital emergency and MRI departments in Staples.

   “We are excited to be embarking on a building expansion project to meet the ever-changing needs of those we serve. Through the years, employees, providers and our boards have focused on the needs of our patients and residents. As a result, we have continued to experience growth and loyalty,” said Tim Rice, President and CEO of Lakewood Health System. “Everyone is eagerly anticipating having room for new providers who are coming to Lakewood Health System, improved technology and equipment and revamped spaces. We are honored the USDA has chosen us to be their partner in this extremely important project which will enhance healthcare services and assist in the economic growth of this region.”

   In addition to USDA Rural Development, LHS received a $4.45 million loan from a private lender and contributed $1.7 million of their own funds – resulting in two projects totaling more than $50.3 million.

   Since 2009, USDA Rural Development has invested over $463 million in essential community facilities and equipment for rural communities through Minnesota. Rural Development also invests in housing, water and wastewater treatment, businesses, renewable energy and broadband.

   For more information on USDA Rural Development programs, please contact your local Area Office by visiting

Last Modified: 10/21/2016