June 12, 2024

Health systems focus on long-term growth, outpatient care amid construction challenges

Editor's Note

Health systems are increasingly focusing on construction projects aimed at long-term growth and outpatient care, often renovating existing facilities, Modern Healthcare June 10 reports. According to Modern Healthcare's 2024 Construction and Design Survey, 60% of respondents see growth in the healthcare construction industry despite inflation, high material costs, and labor shortages.

The shift from inpatient to outpatient services is a key trend, with many procedures moving to ambulatory surgery centers (ASCs). In the article, David Lubarsky, MD, CEO of UC Davis Health, a three-hospital academic health system based in Sacramento, California, highlighted this trend by noting the decreasing need for hospital beds. "Many services, orthopedics being a prime example, already have moved from primarily an inpatient to an outpatient environment," he said. "We're going to see more of that with more services, as procedures become less invasive and slide down to [ASCs] with overnight stay capacity, and then out of surgery centers to office buildings." 

Outpatient care facilities, including medical office buildings, clinics, and cancer centers, are growing. Some recent examples of this trend include projects such as WakeMed’s 82,000-square-foot medical office building and Atrium Health Levine Children’s Hospital’s renovated pediatric blood disorders center. Digital health advancements also drive construction growth, necessitating facility renovations for technology integration. Cost remains a significant obstacle, with construction costs rising 20% in the last 4 years. Regional challenges, such as earthquake and hurricane safety requirements, add to costs.

Rural healthcare facilities face unique challenges due to limited resources and lower reimbursement rates. Government programs offer some support, but more policy intervention is needed to prevent closures and expand care access in rural areas.

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