Healthcare Construction in the COVID Era
06/30/2020
The healthcare construction market has been in a growth pattern for some time due to pressures from an aging population and as a result of shifting demands for how medical services are delivered. Traditionally, the healthcare industry has been more recession-proof than other industry sectors.
Over the past decade, however, political turmoil related to the Affordable Care Act have created uncertainties. Given this uncertainty, some healthcare organizations have been more hesitant to invest in capital-intensive construction projects. With the onset of the pandemic, change has accelerated.
Changes in the Healthcare Industry
Even before COVID-19, healthcare delivery was in a state of transition. Thomas Quesenberry, Senior Project Manager at Perlo, shares his observations. “Over the past several years, we’ve seen a shift towards smaller clinics and medical office buildings, known as ‘MOBs.’ Even larger entities like Legacy Health and Providence Health have pushed for more neighborhood clinics.”
According to Todd Duwe, Director of Business Development at Perlo, “Our healthcare clients are under pressure to create more flexible medical spaces that can be easily adapted and modified for different medical services. All healthcare facilities are under pressure to make sure space is devoted to its highest and best use.” As a result, some clinics and hospitals are moving administrative offices from patient care buildings which are higher cost per square foot into less expensive office buildings that are off campus.
The Impact of COVID-19 on the Healthcare Industry
COVID-19 has, of course, had a massive impact on healthcare providers. Many clinics and hospitals have had to severely restrict elective services and surgeries to conserve PPE and bed space for COVID patients.
As a result of COVID-19, many clinics and hospitals have taken a real hit as elective services often account for a substantial percentage of their revenue. This shortfall has led to the deferment of many healthcare construction projects. Some of those projects may come back online this fall, but recent projections indicate it could take a year or more for a somewhat normal project schedule to resume.
Another impact has been the rise of telehealth services. Although these services were starting to gain traction before the pandemic, they’re now fully embraced by many healthcare providers. “Online health services were the way of the future. Because of COVID-19, they’re happening today,” adds Quesenberry. “Given this new model of healthcare delivery, most likely we’ll see changes in how clinics and hospitals are designed.”
Construction Companies Must Have the Right Skills for Healthcare
For healthcare organizations considering a construction project, it’s important to find a general contractor that’s the right fit. “When looking for a healthcare construction partner, it’s important to find a company that has experience in the industry and knows how to make informed recommendations,” says Duwe. “For example, clinics must be built to control and contain infections, particularly in the COVID environment.”
In fact, healthcare providers’ insurance reimbursements are calculated based in part on the clinic’s ability to control rates of infection as well as patient satisfaction. Successful construction projects hinge on minimizing contaminants and disruption to the patient experience.
Often healthcare projects require an “invisible contractor,” which means construction activities must restrict noise, vibration, and dust. To minimize impact to the patient experience, construction companies must stagger the shifts of their employees and sub-contractors for both regular and off-work hours.
A “New Normal” for Healthcare Construction?
In the long term, perhaps we will see a “new normal” as a result of COVID-19. The pandemic has highlighted some shortcomings in our healthcare system in Oregon, such as a low bed count in most hospitals around the state.
There is also likely to be a long-term impact on how healthcare facilities are designed given the heightened standards for cleanliness and perhaps the long-term need for social distancing. “Even waiting rooms may have a completely different design as a way to control potential infections, whether from a coronavirus or other potential viruses,” says Quesenberry. We expect that some focus will be dedicated to isolation rooms and/or floors that include reconfigured mechanical systems, ante rooms, and changes to central sterile rooms and corridors to improve virus containment. “Given these inevitable changes, it’s important to work with a construction company that can provide out-of-the-box ideas and innovative solutions.”
Most likely, the effects of COVID-19 will have long-lasting effects, both in the healthcare industry and in every other sector of our economy.