In the Becker's Hospital Review 5th Annual Meeting in Chicago, Russell Davis, managing director, The Advisory Board Company; Dave Rosenbaum, vice president for facilities management; and Michael Ugwueke, COO, Memphis, Tenn.-based Methodist Le Bonheur Healthcare discussed the importance of facilities management and leveraging real estate for the strategic success of a healthcare organization. The session was moderated by Julie Kimble, vice president/general manager at Johnson Controls.
According to Mr. Davis, given the amount of changes taking place in the healthcare industry at the moment, facilities and real estate management have to be a part of a healthcare organization's strategic planning. "If you don't have a facilities infrastructure that is well-managed, strategic planning is useless," he said.
Here are four observations on facilities management as well as how it contributes to strategic success:
1. As more services and procedures move into the outpatient setting, organizations need to think about how to leverage their facilities to support both inpatient and outpatient care. These facilities also need to be managed efficiently. "Facilities constitute almost 50 percent of a health system's assets," said Mr. Ugwueke. "You need competent people managing them."
2. For the future, consolidation may be key and organizations can repurpose facilities to support that consolidation. As organizations think about consolidating services, it may make sense to consolidate care at certain sites and then repurpose old sites where space has been created, said Mr. Ugwueke.
"Organizations may need to invest in new technology for which they need more space," said Mr. Davis. "Hence they might need new spaces or new ways to use old spaces."
3. Organizations can partner with companies that help manage facilities, and thereby outsource facilities management while driving out costs. "At Methodist Le Bonheur Healthcare we have almost doubled the size of our facilities and driven down costs, with the help of an outside company," said Mr. Rosenbaum. "We were spending $100,000 before every Joint Commission survey to prepare our facilities, and we decided that there had to be a better way to do this."
An outside facility's management company can also help healthcare organizations think outside the box and look into facilities management strategies employed in other industries, said Mr. Rosenbaum.
4. While looking for a partner, however, it is important that organizations look for partners who are a good cultural fit, said Ms. Kimble. "Facilities represent an important opportunity to reduce operating costs and potential risks," she added. "For example, aging facilities can represent a risk for a health system, and managing them effectively can help reduce that risk."