Hospitals eyeing former retail space for outpatient clinics
- As hospitals eye an increase in outpatient access, one place they’re looking is shopping malls, The Wall Street Journal reports.
- One recent example is Dana-Farber Cancer Institute, which has leased two floors of the former Atrium Mall in Chestnut Hill, Mass. The 140,000-square-foot space will be used for patient exams, infusions and supportive services for recently diagnosed adult cancer patients, among other things.
- The trend is fueled, in part, by changing consumer preferences. As more people shop online, retail tenants pull out and malls are left with empty space to fill.
The idea of medical providers popping up in retail space isn’t that surprising.
With the shift to value-based care and cuts in reimbursement, hospital utilization is down and beds aren't being filled. At the same time, hospital expenses are rising. According to PricewaterhouseCoopers’ Health Research Institute, medical costs are expected to grow at a rate of 6.5% in 2018, fueled in large part by inflation. That means a tighter labor markets and higher costs.
With leaner staffs, hospitals need to find ways to maximize operating efficiencies. Telemedicine could be one way to make care delivery more efficient. Another is shifting more care to outpatient settings. From retail clinics to urgent care centers, patients are demanding healthcare options that fit into their everyday lives — both in terms of location and affordable cost.
In a recent survey of hospital CEOs, 57% said their primary concern was improving access to ambulatory and outpatient settings. Next on their priorities list were reducing expenses (57%), boosting outpatient procedural market share (55%), minimizing unwarranted clinical variation (54%) and controlling avoidable utilization (49%).
While many hospitals are looking to expand outpatient access, others see an opportunity to use smaller community-based care options to keep from going to larger urban areas for treatment. Last month, McCullough-Hyde Memorial Hospital in Oxford, Ohio, opened three new surgical suites aimed at preventing patients having to travel to Cincinnati, Indianapolis or Dayton for surgical care.
A recent report from JLL Corporate Solutions emphasized the importance of real estate strategy for healthcare organizations. It suggested building and buying properties that can be repurposed if necessary and bringing outpatient services closer to where patients live.
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