flexiblefullpage
billboard
interstitial1
catfish1
Currently Reading

Holistic care model, regulatory changes make outpatient facilities a high priority [2014 Giants 300 Report]

Holistic care model, regulatory changes make outpatient facilities a high priority [2014 Giants 300 Report]

With the Affordable Care Act still in its infancy, Building Teams are seeing reverberations in the investment decisions of healthcare providers.


By Amy McIntosh, Associate Editor | July 23, 2014
Catawba Valley Medical Center Pavilion, Hickory, N.C. Photo: courtesy Freeman Wh
Catawba Valley Medical Center Pavilion, Hickory, N.C. Photo: courtesy Freeman White

With the Affordable Care Act still in its infancy, Building Teams are seeing reverberations in the investment decisions of healthcare providers, including new ideas about the types of buildings they are asked to create.

“To reduce costs, many hospitals, physicians’ groups, and healthcare systems are merging to eliminate duplication of operations,” says Kelly Altes, P.E., Project Executive for KJWW Engineering Consultants and a member of BD+C’s “40 Under 40” Class of 2014. “These and other trends are in many cases the result of the Affordable Care Act, which has providers focusing more than ever on patient experiences and outcomes, as well as outpatient services. This shift is resulting in a significant increase in medical office building and clinic construction and renovation projects.”

The latest version of the annual Hospital Construction Survey conducted by the American Society for Healthcare Engineering with Health Facilities Management magazine confirms this trend. The percentage of respondents planning medical office building expansions, completely new MOBs, neighborhood outpatient facilities and primary-care clinics, and ambulatory surgery centers were all up significantly. Meanwhile, 41% said the new regulatory environment makes it less likely that they’ll proceed with large new hospital construction projects.

TOP HEALTHCARE SECTOR ARCHITECTURE FIRMS

2013 Healthcare Revenue ($)
1 HDR $191,150,000
2 Stantec 126,523,841
3 HKS 113,904,765
4 CannonDesign 108,000,000
5 Perkins+will 96,663,046
6 HOK 92,185,580
7 NBBJ 85,544,000
8 Perkins Eastman 69,750,000
9 Hammel, Green and Abrahamson 66,036,440
10 SmithGroupJJR 58,159,528
SEE FULL LIST

 

TOP HEALTHCARE SECTOR ENGINEERING FIRMS

2013 Healthcare Revenue ($)
1 AECOM Technology Corp. $180,760,000
2 Jacobs 87,770,000
3 URS Corp. 45,036,525
4 Smith Seckman Reid 40,105,600
5 KPFF Consulting Engineers 38,000,000
6 Allen & Shariff 36,000,000
7 BR+A Consulting Engineers 29,900,000
8 Affiliated Engineers 27,947,000
9 CCRD Partners 23,760,000
10 Burns & McDonnell 19,810,000
SEE FULL LIST

 

TOP HEALTHCARE SECTOR CONSTRUCTION FIRMS

2013 Healthcare Revenue ($)
1 Turner Construction $2,001,060,000
2 McCarthy Holdings 1,738,000,000
3 Skanska USA 1,207,794,377
4 Brasfield & Gorrie 974,254,444
5 Clark Group 867,497,494
6 DPR Construction 806,488,333
7 PCL Construction 721,107,363
8 Whiting-Turner Contracting Co., The 720,455,505
9 JE Dunn Construction 700,315,855
10 Balfour Beatty US 469,422,190
SEE FULL LIST

With care models changing, medical office buildings increasingly provide services that were once the exclusive province of hospitals, from cancer care to emergency treatment to operations. According to Cushman & Wakefield, 80% of surgeries can successfully be completed in an ambulatory setting.


Giants 300 coverage of Healthcare brought to you by DuPont www.fluidapplied.tyvek.com

By moving these procedures away from large hospital campuses—which are often landlocked with little room for expansion—the volume of patients requiring the hospital is reduced, making way for patients with more complex needs. Since many off-campus MOBs are part of a network associated with a larger hospital, patients who end up needing more advanced care can simply transition to the main campus.

Locations of new MOBs are carefully considered, with developers opting to place them near shopping, restaurants, major roads, and public transit. In the past, many retail centers were wary of making deals with medical tenants because of the overall stigma of having a healthcare provider near retail and dining. Retail developers also believed medical tenants wouldn’t produce attractive levels of revenue. However, some developers have decided that having healthcare tenants is better than no tenants at all. 

In particular, medical groups have made good use of large spaces vacated by defunct retail franchises, both stand-alone and within malls. Kaiser Permanente recently opened a 32,000-sf MOB in Portland, Ore., via adaptive reuse of a Circuit City location the healthcare organization bought out of receivership in 2010. Minnesota’s HealthEast Care System has created clinics in St. Paul-area spaces once occupied by Borders, Gander Mountain, and eq-life retail stores.

 

New partnerships and development models

A Cushman & Wakefield investor survey on medical office buildings reports that many healthcare providers are now seeking to form joint ventures, often between for-profit and not-for-profit health systems. These partnerships may offer the for-profit business the name recognition of the nonprofit, and give the nonprofit access to the financial and physician resources of the for-profit. When smaller clinics partner with larger, better-funded hospitals, they can pool their resources to care for more patients.

A Jones Lang LaSalle report indicates that real estate investors are increasingly enthusiastic about the profit potential of MOBs. In 2013, 78% of MOB buyers and sellers were investors rather than developers or hospitals—a dramatic shift from 36% in 2012. Hospitals and healthcare providers still control 85% of healthcare real estate and are generally not interested in selling, leading to a tight property market, JLL says. The firm predicts that hospitals may be increasingly willing to reconsider leveraging under-used property assets, in light of strong investor interest in the sector. 

 

Regulations transform hospital design

Though construction of big new hospitals has slowed, healthcare groups are still investing in updates to keep properties functional, safe, and competitive. A twist pointed out by the HFM/ASHE report: Obamacare’s “two-midnight rule,” whereby hospital stays lasting less than two midnights must be billed as outpatient services. Some hospitals are creating dedicated units for observation-status patients, a tactic that may reduce overall length of stay.

 Private patient rooms are the new normal, typically flooded with natural light and richly equipped with accessibility features. New Facility Guidelines Institute recommendations for 2014 emphasize sterilization and infection control in both hospitals and outpatient facilities. Some clients are also debating pros and cons of “same-handed” layouts, wherein all patient rooms are similarly oriented, versus traditional “mirror” floorplans with back-to-back headwalls. 

“To achieve desired healthcare outcomes, evidence-based design and Lean design are becoming increasingly critical tools to design facilities in ways that minimize patient stress, increase patient and staff safety, and improve staff effectiveness and quality of care,” Altes says. “As a result, we’re seeing increased attention on such things as the incorporation of natural elements; ‘family-centered’ spaces; single-bed, same-handed patient rooms; and decentralized materials management.”

 

Read BD+C's full 2014 Giants 300 Report

Related Stories

| Apr 25, 2014

How the 'digital natives' will transform your Building Team

The newest generation to enter the workforce is like no other that has come before it. This cohort is the first to grow up with the Internet, mobile technologies, and an “always connected” lifestyle.

| Apr 25, 2014

A radiant barrier FAQ: Everything you wanted to know but were afraid to ask

There are many examples of materials developed for the space program making their way into everyday life and radiant barriers are just that. SPONSORED CONTENT

| Apr 25, 2014

6 winners selected for the Architectural League Prize

The Architectural League Prize, created in 1981, "recognizes exemplary and provocative work by young practitioners and provides a public forum for the exchange of their ideas," according to The Architectural League. 

| Apr 24, 2014

Unbuilt and Famous: LEGO releases box set of Bjarke Ingels' LEGO museum

LEGO Architecture has created a box set that customers can use to build replicas of the LEGO Museum, which is not yet built in real life. The museum, designed by the Bjarke Ingels Group, will commemorate the history of LEGO.

| Apr 23, 2014

Ahead of the crowd: How architects can utilize crowdsourcing for project planning

Advanced methods of data collection, applied both prior to design and after opening, are bringing a new focus to the entire planning process.

| Apr 23, 2014

Developers change gears at Atlantic Yards after high-rise modular proves difficult

At 32 stories, the B2 residential tower at Atlantic Yards has been widely lauded as a bellwether for modular construction. But only five floors have been completed in 18 months.

| Apr 23, 2014

Experimental bot transfers CAD plans onto construction sites

The Archibot is intended to take technical data and translate it into full-scale physical markings on construction sites.

| Apr 23, 2014

Mean and Green: Top 10 green building projects for 2014 [slideshow]

The American Institute of Architects' Committee on the Environment has selected the top ten examples of sustainable architecture and ecological design projects that protect and enhance the environment. Projects range from a project for Portland's homeless to public parks to a LEED Platinum campus center.

| Apr 23, 2014

Architecture Billings Index dips in March

The March ABI score was 48.8, down sharply from a mark of 50.7 in February. This score reflects a decrease in design services.

Sponsored | | Apr 23, 2014

Ridgewood High satisfies privacy, daylight and code requirements with fire rated glass

For a recent renovation of a stairwell and exit corridors at Ridgewood High School in Norridge, Ill., the design team specified SuperLite II-XL 60 in GPX Framing for its optical clarity, storefront-like appearance, and high STC ratings.

boombox1
boombox2
native1

More In Category

Student Housing

The University of Michigan addresses a decades-long student housing shortage with a new housing-dining facility

The University of Michigan has faced a decades-long shortage of on-campus student housing. In a couple of years, the situation should significantly improve with the addition of a new residential community on Central Campus in Ann Arbor, Mich. The University of Michigan has engaged American Campus Communities in a public-private partnership to lead the development of the environmentally sustainable living-learning student community.



Adaptive Reuse

Empty mall to be converted to UCLA Research Park

UCLA recently acquired a former mall that it will convert into the UCLA Research Park that will house the California Institute for Immunology and Immunotherapy at UCLA and the UCLA Center for Quantum Science and Engineering, as well as programs across other disciplines. The 700,000-sf property, formerly the Westside Pavilion shopping mall, is two miles from the university’s main Westwood campus. Google, which previously leased part of the property, helped enable and support UCLA’s acquisition.


Geothermal Technology

Rochester, Minn., plans extensive geothermal network

The city of Rochester, Minn., home of the famed Mayo Clinic, is going big on geothermal networks. The city is constructing Thermal Energy Networks (TENs) that consist of ambient pipe loops connecting multiple buildings and delivering thermal heating and cooling energy via water-source heat pumps.

halfpage1

Most Popular Content

  1. 2021 Giants 400 Report
  2. Top 150 Architecture Firms for 2019
  3. 13 projects that represent the future of affordable housing
  4. Sagrada Familia completion date pushed back due to coronavirus
  5. Top 160 Architecture Firms 2021