Making Adjustments – Reducing Healthcare Facility Costs in the New Era

Well, here we are – a few years into the passage of the Affordable Care Act and our industry is still digesting what it really means for the planning, design and construction of new facilities. The healthcare industry gave up $1 trillion in payments over 10 years in exchange for 32 million newly insured Americans. However, recent projections from the Congressional Budget Office peg the actual enrollment at 24 million through 2024. That, coupled with other financial pressures such as mergers and acquisitions, adding primary care physicians, the investment in IT solutions and new equipment ​​and financial penalties under the ACA, means that more than ever, healthcare organizations need to realize maximum value in their physical spaces.

Add to this the ever-increasing focus on patient satisfaction scores. It seems that for several years I have sat in countless planning meetings where the discussion inevitably touched on the need for larger patient rooms with ample family space, bigger windows for natural light, amenities for the family members and on and on. On top of that, IT closets continue to get larger along with other infrastructure needs. All of these are driving up the average square foot per patient and, ultimately, the cost per square foot.

But, the party is over. Yes, patient satisfaction is still important but the pendulum needs to swing the other way. Design and construction teams are going to need to dig deep and wring out excess costs to achieve maximum value without compromising quality, safety and patient experience. In 2000 the average patient room was 250 SF. Do we really need 320 SF in a patient room? Will 290 SF work anymore? Do we need 20 duplex outlets in a patient room when code minimum is six? We need to peel back the onion to decide what is really important.

Then there is the discussion about how projects are delivered. We will see more design-build, especially with the plethora of proposed outpatient facilities. But, we will save a project delivery discussion for a later date. Either way, we need to get smarter about how buildings get designed and built with a focus on maximizing true value while right sizing appropriately. How to get smarter? Make sure that the team you select understands your definition of value and commits to acheiving it.