Healthcare reform is altering the pace and direction of hospital construction.
by Brian Veeneman
As healthcare reform proceeds, the landscape of healthcare design and construction is transforming. Implementation of reform will have resounding effects changing facility needs and specifications for healthcare providers.
Large Project Uncertainty
Apprehension about reduced reimbursement rates has put a big chill on many plans. Organizations are unwilling to proceed with new projects in a slow economy and facing a few years of uncertainty as they await the implementation and resulting unknown effects of healthcare reform. Consequently, organizations are building fewer new or replacement hospitals.
In fact, the downturn of the economy put a halt, or even killed some hospital projects within the past few years. However, as the economy slowly recovers, large projects are not necessarily firing on all cylinders.
Now a different dynamic is causing trepidation–healthcare reform.
No one truly knows how healthcare reform will affect the bottom line. Margins are expected to shrink and as a result may effect construction. New construction approved now will likely avoid mega projects and will likely be for lower-cost, community-based facilities, rather than big on-campus projects.
Healthcare organizations are still figuring out what facilities and services are best suited for healthcare payment reform and the brave new worlds of Accountable Care, bundled payments and patient satisfaction. (Many are expecting the Affordable Care Act to bring a surge in patients after coverage expands in 2014.)
In addition, the Affordable Care Act has an accompanying emphasis on patient safety and quality of care. These factors are causing healthcare design to scale back from the traditional large hospital project to focus more on how to maximize value and improve medical outcomes, especially with the prospect of future Medicare reimbursements being tied to performance.
Shift in Marketplace
A shift in the marketplace is also occurring. Large medical office buildings and existing facility upgrades are becoming the new norm, albeit with a refined focus to make operations more efficient and to help remove costs from the system.
The utilization rates for outpatient services keep going up as advanced treatment modalities and enhanced technology allow more and more care to be delivered quickly and efficiently outside the institutional setting. Look for more higher-acuity care to move out of the hospital and into the office setting.
The continued shift of care to the ambulatory setting is one major trend we can count on moving forward. As a result, the decision is increasingly being made to invest in outpatient care and to deliver care in the community spokes rather than the traditional hub.
Focus on Savings, Technology, Sustainability, Flexibility
There are many other facets that are driving changes in scope.
Technology is key in today’s rapidly changing healthcare environment . Whether it is a focus on electronic medical records or patient safety features taking on more of an information technology emphasis, technology is at the forefront of facility design. Additionally, projects are routinely focusing on data centers and housing always-advancing modern diagnostic and medical equipment.
Sustainability is always a hot topic when seeking to reduce costs. Energy efficiency or renewable energy generation is in clear focus during design discussions, as well as waste and emission reduction.
Healthcare spaces are also being designed to have more flexibility. In an effort to stay ahead of changing conditions in the healthcare field, we can expect an increase in demand for easily reconfigurable spaces in outpatient facilities. This flexibility allows facilities to adapt to the soon-to-be unveiled effects of healthcare reform.
Evidence-based design (EBD) is a buzz phrase in healthcare design. EBD is the use of credible evidence to influence the design process. EBD uses a methodology in which decisions are based on credible research to achieve the best possible outcomes. The purpose of EBD is to improve safety and clinical outcomes, operational efficiencies, as well as customer and staff well-being and satisfaction.
Will the wave of EBD efforts trend continue? The questions surrounding EBD revolve around the price tag and the elusive measurement of return on investment. But if improvements in outcomes in patient treatment can be achieved, using EBD could allow new facilities to reap revenue enhancements in the form of pay-for-performance programs.
In the end, healthcare facilities are falling in line with every other aspect of healthcare administration as reform is implemented – adapting and trying to remain flexible.
Brian Veeneman is an associate with Hall, Render, Killian, Heath & Lyman, P.S.C.
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