Build Wise

Improving Healthcare Efficiency

Improving Healthcare Efficiency

In the U.S., the healthcare industry is in a new era with changing legislation. The American Health Care Act (AHCA) as a replacement for the Affordable Care Act (commonly referred to as Obamacare) was recently voted down in Congress. A Senate-approved plan that suits the U.S. healthcare industry has yet to emerge.

Hospitals and healthcare systems will need to consider potential impacts on their business and what they will need to do to survive, maintain, or grow their market position. Healthcare facilities of today are not fiscally sustainable. There must be, and there will be, transformative changes over the next ten years.

The Centers for Medicare & Medicaid Services data project national health expenditure to be $5 trillion by 2022. As baby boomers age, 10,000 Americans will turn 65 every day for the next 20 years, and the total demand for healthcare services will only grow. To achieve and maintain a competitive advantage in the market, healthcare facilities must increase their efficiency and performance, reduce operational costs, utilize resources effectively, develop processes to enable scalability, and implement modern integrated technologies.

Transformation is already underway with healthcare leaders. They have ventured into retail clinics, urgent care, and telehealth. These delivery models have already demonstrated an exceptional ability to improve quality and customer service while also reducing costs. 

Retail clinics and urgent care centers can be cost-effective and time-saving alternatives to hospital emergency departments (EDs) for nonemergency care. It is estimated that 13.7%–27.1% percent of all ED visits could take place at a retail clinic or urgent care center, with potential cost savings to the healthcare system of approximately $4.4 billion annually.

In 2016, total U.S. retail clinic sales were estimated to be more than $1.4 billion, an increase of 20.3% per year from $518 million in 2010 according to Kalorama Information. As of 2017, there are 2,225 retail clinics in the U.S., and they are expected to continue expanding through 2020.  As a result, there's been significant innovation and construction.

Urgent care center sales have risen from about $11.8 billion in 2011 to more than $15 billion in 2017. Today the number of clinic locations stands over 10,000 locations.

The market for telehealth is also expected to grow exponentially. On-demand telehealth has increased by about 20% annually, with approximately 1.1 million patients using these services in 2016. It has become an integral mode of delivery. Hospitals and healthcare delivery systems are embracing telehealth, having made substantial investments in infrastructure, training, and process re-engineering.
While choosing any or all the above methods on its own can lead to notable improvements, it is when they are strategically put into action together that significant time and cost savings become a reality.

Studies have shown that when looking at the total lifecycle cost for a healthcare facility, 87% of the total cost spent is on operating the new facility, almost half of which is allocated to utilities. Executing the right approach to the planning, design, and construction of a new facility can yield a positive return on investment and lower the overall cost basis for ongoing operations.

Hospitals strive to extract the maximum value from their facilities by lowering operating costs, enhancing patient care, and increasing profitability. Investing in a data-driven approach to systematically review the current state of their systems, people, and processes allow hospitals to proactively execute new strategies. 

By following a structured plan through the capital delivery process, a more efficient building can be achieved. The simplistic formula begins with the right concept that is an extension of the strategic vision.
Employing a data-driven approach increases the likelihood of a successful transformation by outlining measurable current and future state targets. Enstoa’s advisory team offers a range of services, from initial assessment an organization’s project delivery capabilities through to advising throughout all stages of the asset lifecycle, from planning and design to construction and, finally, to operations and maintenance.

As more and more off-campus facilities are becoming part of larger systems, opportunities exist to capitalize on the economies of scale. Centralizing operations, implementing the right technology to network all facilities, and eliminating duplicity are all areas in which savings can be realized. Enstoa provides in-depth analysis of current processes, roles, and technology, as well as exploration and documentation of organizational maturity, strategic direction, and the target-future state. Our advisory practice is complemented by our expert digital practice to provide solutions meeting the objectives of the business. We aim to help healthcare organizations optimize operations, drive efficiency and increase profitability at the lowest possible investment.

Our unmatched expertise within the construction and infrastructure space, combined with our digital prowess is the reason organizations are engaging Enstoa. We provide our clients with a combination of breakthrough software innovation, systems integration, and internal cultural change devoted to unlocking individual, team, and organizational productivity.

Read "Healthcare Facilities Secret for Success: Project Selection, Speed and Efficiency", Enstoa’s byline originally published in Becker's Hospital Review.