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Disruption In Healthcare Delivery & What That Means for Hospital Facilities & EVS Departments

Just as Amazon reinvented the retail shopping experience for consumers, a similar envisioned mindset is driving the Healthcare Delivery of the future.  For centuries now, traditional healthcare has been delivered within the brick and mortar of the hospital walls, with small exceptions for minor sickness and injury. Providers and Hospitals were able to manage and direct how and where healthcare was provided, with little input from Consumers as to their needs.    However, with the Digital Age and a new generation of consumers demanding an expanded platform of options available to them, for their healthcare needs, we are seeing a drastic shift in Healthcare Delivery models.

Amazon, Berkshire Hathaway and JP Morgan (non-traditional healthcare providers) have partnered together to form a new Non-Profit Healthcare company named “Haven”. The vision behind the formation of this healthcare entity as noted by the new CEO of Haven was to “change the way people experience health care so that it is simpler, better, and lower cost”. Another key focus included: “Improving the process of navigating the complex health-care system and accessing affordable treatments and prescription drugs”.

interim management

A recent Market Scan of Healthcare consumerism highlighted some specific concerns for hospitals;

  • 88% of Hospital executives feel threatened or vulnerable by Optum, CVS Health and Amazon and the consumer-friendly offerings from these non-hospital competitors.

  • Nearly 79% of Hospital executives identified Optum as posing the highest competitive threat to hospitals and health systems, and 26% identified them as an Extreme Threat. 66% saw CVS/Aetna right behind Optum and 56% viewed Amazon as a strong or Extreme Threat.

  • 98% of Hospital Executives identified that their digital experience is significantly worse than Amazon’s in providing what consumers need for their healthcare needs.

In spite of these concerns, Optum’s CEO stated in June 2019 that Optum “will not own inpatient or post acute care services”. “They will expand their footprint in areas outside the hospital to include Urgent Cares, Surgical Centers and Primary Care Offices.”

So, what lies ahead for Facilities and EVS teams in traditional hospitals as more and more healthcare is delivered outside of the traditional brick and mortar hospitals of the past? There are two trains of thought:

  • In the AHA’s Society for Healthcare Strategy and Market Development, 34% of healthcare leaders said it is very likely their hospital or health system will acquire offsite, non-healthcare facilities for out-patient services. Another 37 said it is somewhat likely.

  • Declining inpatient volumes and the shift away from the main hospital campus is resulting in closures of internal hospital spaces. These, now available, spaces are being converted to Offices, freestanding cancer centers, medical fitness complexes and MOB’s. Depending on the space available, they can become retail space or medical malls that offer retail healthcare offerings.

In both of these scenarios there are impacts for Hospital Facilities teams as they look to offer relevance in regards to the services provided and gained efficiencies in support of the changing healthcare delivery of their organization. Some key aspects for consideration are:

  • Purchase of already existing buildings or facilities that would have a reduced Capital Cost to the organization. With Amazon’ proliferation in the retail world, previously bustling retail locations now sit empty and waiting for the taking at low market costs.

  • Though there will be remodeling / renovating costs associated with a purchase, it will be far lower than building a new shell of a building and associated infrastructure. These types of facilities are often found in highly visible retail environments desired by the new consumerism.

    • Facilities teams will have to become adaptive to working with Leases and outside building purchases. This shift means staff will now have to be assigned to outlying locations for PM’s, Work Orders, Cleaning Assignments, building inventory needs.

    • There are transportation issues that need to be considered and how staff are managed in an offsite environment.

    • The bottom line is, if hospital facilities teams don’t manage this well; someone else will manage it for them.

It’s not a question of will it happen; it’s when will it happen to you?

  • Can the newly built or renovated offsite locations meet the Emergency Needs of the hospital? For example, if a hospital builds an offsite reference lab to support both the hospital’s laboratory needs and outlying facilities needs, is the reference lab built to standards that will allow it to survive natural disasters that a hospital must survive. The temptation would be to build to a lower standard since offsite / non-hospital construction does not require meeting the same building codes as a hospital. However, should a disaster shut down the reference lab, the hospital will essentially be shut down also.

  • Can Environmental Services provide the same level of sanitation and safe environment in an offsite facility? An offsite Surgery Center still requires the same high level of disinfection and cleaning that an onsite Surgery Suite would require. An advantage a hospital driven Surgery Center has over a 3rd party owned/operated facility is the focus and adherence to cleaning standards identified by AHE, AORN, APIC and CDC in regards to Surgical Cleaning.  Will 3rd party providers have that same focus or expertise?

Those Facilities and Environmental Services teams that will still be around in the years to come will be those who were able to adapt to the changing healthcare delivery model and adjust the manner in which they respond to healthcare facility needs. Blockbuster Video is a prime example of a company that could not or would not adapt to the disruption Netflix threw into the Video industry. Blockbuster assumed the consumer would continue to rent videos the same way they had for years. It didn’t take long for the industry to pass them by and now they are an example of how not to respond to digital technology and the new consumerism.

Healthcare facilities teams should head the same warning in their future. They must become flexible and adaptable to shifting outside the traditional healthcare structure. They must become lean in the workflow process. Looking at benchmark standards for productivity -not as a measure they have to justify when they are not meeting their goal, but rather how to better their standards and use that for their own advantage. Facility Managers must be looking at technology and innovation to drive costs down.  Such as:

  • Building maintenance systems that can be shut or backed down when the building is not in use.

  • Using technology that delivers to a manager’s phone, real time date about facility systems.

  • Conversion to new energy efficient systems such as LED lighting can help drive energy costs down and replacement costs down.

Finally, ASHE (American Society of Healthcare Engineering) in their Future Scan of 2019 identified some strategic goals to help their members maintain relevance into the future years. Some of those strategic objectives are;

  • Maintaining a Professional Reputation. The organization has developed and promotes professional and experienced certifications for industry leaders to ensure the industry has individuals with advanced skills to address the needs of medical facilities.

  • Career Development. The industry has seen a progression of Facilities Management Leaders retiring and exiting the industry. Incoming potential replacements often overlook Facilities Management opportunities for positions in more digital and technology driven aspects of the industry. There are not many colleges or schools driving graduates in Facilities Management. A key focus for the profession is the development of internships, mentoring curriculums and Apprentice Programs to help drive future leaders for the industry.

  • Operational Excellence. Helping Facilities and Environmental Services managers operate at the highest levels and standards. For example, the Energy to Care program has seen more then $327 Million is savings across the country since it was implemented. As hospital facility managers use the tools to benchmark, measure and meet the goals of this program, they assist their hospitals and healthcare systems to maintain viability in the marketplace.

As we see the shift in Healthcare Delivery over the coming years, it is incumbent on the healthcare and facilities managers to have greater forethought and planning for their hospitals and healthcare facilities. Looking at all aspects of the Facilities process is key to success. Having highly skilled design and development construction teams, operations and maintenance teams, Environmental Services leaders, along with outside experts in architecture and engineering and real estate will help ensure their healthcare organizations are well situated for the future challenges that will be presented.

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