Growth Prospect: Support Services Consolidation

Posted on April 6, 2012

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Real estate on hospital campuses has always been valuable. Just how valuable…well that is being further clarified by current building trends.

One of those efforts is the consolidation of healthcare support services, and their relocation to areas away from the main hospital.

Support service is a catch-all term for anything not directly linked to diagnosis, treatment and recovery functions at a hospital. Each hospital or system defines core functions differently. Some support services include: central sterilization, laundry, mail, pharmacy, laboratory, food preparation, storage, shop / maintenance, and administrative spaces.

In higher education, this collection is called auxiliary services and they are housed in the college’s student union. Hospitals do not have the equivalent of a student union, so historically these functions were separated spatially as much as possible from the core hospital activities but still structurally connected to the hospital. However over time, departments grow, technologies change, and what was once located out-of-the-way is now in prime clinical space. Thus, the need can exist for relocating support services.

I spoke with an administrator who noted in England it is common for several unaffiliated hospitals to develop a central facility to share support services. This building then becomes a distribution hub to the five or six hospitals for things every hospital needs like linens, food, dry goods, and supplies.

Incidentally, Haskell is completing a similar facility in south Florida for a joint venture. This facility will contain food prep, central sterile, pharmacy, administrative, and distribution services, and serve four hospitals between two healthcare systems.

Functionally, a building of this type has a lot of advantages. First, it can be centrally located to the facilities it serves. Second, it can efficiently serve more hospitals more easily with less dedicated square footage. Third, economies of scale allow greater purchasing power between the member facilities, if resources are pooled. Fourth, the space is inexpensive square footage to build, own and maintain (construction type, taxes, etc.). Fifth, the layout is flexible enough to change to fit the needs of the joint venture. Finally, such a facility frees up valuable space at several hospitals, space which can be used for core hospital functions.

Support service consolidation off-site is a move each hospital will need to study. The teaming aspect required to make it a smart financial decision for some may add an unwanted complication. For small hospitals, rural hospitals, or hospitals with a lot of acreage surrounding their hospital, it may not make financial sense. For the land-locked and others with unfavorable departmental adjacencies, it may prove beneficial.

A hospital I spoke with last month is looking at a potentially small but expensive laboratory renovation right in the middle of needed clinical space. The Director of Construction was lamenting the location of their lab and said his hospital was in the early stages of moving the lab outside the hospital in a consolidation effort.

If nothing else, limited space in the main hospital is pushing administrators to force-rank hospital functions in importance. Support service consolidation to a building or precinct elsewhere dedicated to only those functions also confirms the belief hospitals of the future will contain only essential functions for the very sick—and everything not requiring direct doctor or caregiver input will likely find another home. It allows healthcare delivery to take priority and be further integrated within the hospital, while physically separating secondary activities: integration through disintegration.

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Posted in: Growth Prospect