Decentralised healthcare system needs real estate: Colliers
The US healthcare system's shift towards an ambulatory network of clinics and out-patient facilities has spotlighted the need for real estate skills in the sector, according to Coy Davidson, senior VP of Office and Healthcare Services at Colliers International. In a blog post, Davidson said the decentralised healthcare model required expert analysis of where primary care clinics, ambulatory centres and micro-hospitals should be located to capture the most patients, and that site selection "required some of the disciplines of the retail sector".
The Shift to Outpatient Care by Healthcare Providers and Cost Constraints Increases Emphasis on Real Estate

Healthcare providers are dealing with a myriad of challenges in the face of softening admissions, changing consumer expectations about healthcare, tight operating margins, shrinking budgets, and shifting policies. While facing these challenges many health systems are looking to expand their access points to capture more patients and drive referrals. This translates into a more distributed real estate footprint with a goal to bring convenient access closer to patients driven by advancements in technology, cost, and consumer-driven care.

According to their 2017 State of Cost Transformation in U.S. Hospitals from Kaufman Hall: 96 percent of hospital executives surveyed agreed to transform costs was a “significant” to “very significant” need.

However, more than half of organizations haven’t implemented adequate cost reduction goals. Part of the solution is ensuring that patient care is delivered in the most appropriate setting by providing routine care and simple procedures in lower-cost ambulatory facilities rather than directing large volumes of outpatient services through high-cost medical centers. Reconfiguring portfolios and service lines will generate an increased amount of real estate activity for healthcare providers.

Care Shifts Away from the Hospital Setting

Outpatient clinics are more important than ever before as they become the primary delivery vehicle for care. The traditional hub and spoke model in healthcare, which puts hospitals at the center of care delivery, is changing to focus more on ambulatory care.

The total number of outpatient visits has grown by 1.9 percent per year from 1994 to 2014. Over the same time period, inpatient admissions declined at an annual rate of 0.64 percent.

As healthcare delivery continues to shift to an outpatient setting, the volume of new medical office development continues to expand. A total of 35.7 million square feet of medical office buildings (MOBs) and other outpatient projects were started or completed last year, according to a recent survey from Revista.

According to data from the Advisory Board, 92% of hospital systems are planning new construction or a renovation project for an Ambulatory Surgery Center (ASC), MOB or Urgent Care clinic and 37.8% of hospital systems are planning a new Micro-Hospital or Free Standing Emergency Department.

Care delivery and reimbursement are shifting to a more integrated, streamlined, and cost-effective approach, and rather than just prioritizing large costly hospital facilities, healthcare systems will allocate more capital to multiple, smaller, lower-cost outpatient facilities.