Part of a more than $2 billion overhaul of Lexon Hill Hospital will include an expanded Emergency Department, larger operating rooms, single-bed patient rooms, a dedicated Mother and Baby hospital, and a 40-story residential tower.

Northwell Health system is the state's largest private employer.

Northwell filed paperwork with the city Friday marking the first step in transforming the 160-year-old institution which began as a dispensary for immigrants into the hospital of the future.

"Everybody's modernizing, everybody's upgrading and you cannot continue to survive long-term with a hospital where the youngest building of the complex is over 40 years old. If you don't do this now, you'll have a hospital that's ten years older," said Michael Dowling, President of Northwell Health.

An aging patient population, a growing demand for services and an increase in patients from outside of Manhattan are driving the need for renovations.

“Because medicine is changing. The way all of the different disciplines work together, the expectation of patients,” Dowling added.

Of course, any development happening in the city causes some concern, and the Upper East Side is certainly no stranger to construction controversy.

"Development just being your next-door neighbor is going to be a concern for many people who live around there," says city councilmember Keith Powers, who represents the Upper East Side.

The most controversial part of the plan is the proposed 40-story apartment tower which would help generate revenue for the rest of the overhaul. The building would far taller than anything else in the neighborhood. Powers says the city approval process will examine the impact on the community. It's not hard to predict the issues that will be raised.

“Smog, pollution, traffic, everything. That's what happens when they build, right?" said one patient, James Summers, after being discharged from the hospital Friday afternoon. He lives in Harlem, and said while he liked the hospital, it could use more than a few upgrades.

The hospital would stay open while construction happens in phases.

Northwell is planning a fundraising campaign to help pay for it.