Why Is Healthcare Facility Construction So Expensive?

Healthcare cost in the United States continues to rise at an alarming rate. With the aging baby boomer population, the impact of the Patient Protection and Affordable Care Act and current economic climate attempting to understand and control these costs has become more important than ever. One aspect of healthcare cost that always seems to cause confusion and even frustration is healthcare facility construction. Why is healthcare facility construction so expensive?

Many medical facilities house patients who are receiving critical services. Because of the critical nature of these services the individual patient may not be able to adequately care for themselves in fire, emergency or other threatening situation. As we will see, many of the systems and features in healthcare buildings are designed and installed in such a way as to protect the patients who may be incapacitated or compromised. The easiest way to demonstrate this and why healthcare facility construction is so expensive is to take a virtual a tour. With a tour, we can demonstrate and identify the unique features and inherent cost of a typical healthcare facility, many of which are designed to protect the patient user.

Let's start our tour at the main entrance. Often, you can pull the car, van or ambulance right up to the front entrance under a large canopy or the porte cochere. This canopy or porte cochere is typically equipped with sprinklers, special lighting and designed for the loading and unloading of the handicapped. For medical buildings, there are often two porte cochere, one for the general public and one for patient transfers. If we take a moment to walk around the building, before going inside we might also notice windows enveloping each floor (windows for each patient room), extra wide sidewalks, multiple handicapped parking spaces and access points, handicap van or ambulance throughway and parking and covered or reserved parking for physicians. In addition, we might find an oxygen tank and other medical gases for delivery of these gases to patient room or surgery suites. Medical gases delivered to patient rooms and or surgery suites are a very unique feature almost exclusive to medical facilities.

If we continue our walk around the building we might see the HVAC system. A healthcare oriented HVAC system must deliver specially, filtered and controlled air and do so evenly though out the entire building. As we pointed out earlier, we are often dealing with incapacitated or compromised patients who may be weak, in pain or physically handicapped. Fundamental patient comfort like, clean, controlled, even air flow must be a non-issue in healthcare facilities. Finally, the outside tour of the building might reveal a generator. A generator can be used to power emergency backup and certain life safety systems. These generators are often housed in large, separate structures and can have a material impact on overall building cost.

As we approach the main entrance the building signage may indicate the facility is operated on a 24 hour, 7 days a week basis. The 24/7 nature of the building coupled with the safety concerns of incapacitated or compromised patients is very important in relation to hidden costs and features associated with healthcare facility construction. Almost all MEP systems (mechanical, electrical and plumbing) in a healthcare building will be oversized and or redundant. The oversized or redundant nature of these systems allows for part of the system to be worked on while the rest of the system continues to function. Healthcare facility HVAC air handlers for example, are often larger than typically required to achieve higher static pressures and the required air flow capacities mentioned earlier. Oversized or redundant systems are a common theme in medical building construction and significant contributing feature to the expensive nature of the facility.

Once inside the building we will find a fire or emergency control panel. The panel for fire and emergency systems for many commercial buildings, including healthcare are often found just inside the main door. This placement helps facilitate action by appropriate personnel when alarm sounds or disaster strikes. However, healthcare oriented fire and emergency control systems often build-in unique or special features. The systems are often more flexible, allowing for multiple choices and options. Options such as evacuation notice or warning, barrier control, zone by zone evaluation, general or isolated announcements and lock down.

As we step into the main lobby there are likely to be two elevators types, one for public use and one for transporting patients. A patient designed elevator must accommodate a gurney or stretcher and often opens to the front and the back. Since patient elevators open to the front and the back, space needs are greater than a typical passenger elevator. Exit corridors off the patient elevator to the patient oriented porte cochere are common in healthcare facilities. In a well designed, well operated, medical building you will rarely see a patient rolled out on a stretcher through a main lobby or public hallway. As we stand in the main lobby and look up or down we might also see safety lighting features, special ceiling tiles, and large number of sprinkler heads, specially designed flooring and even bacterial resistant window coverings.

If we could look behind the walls or beneath the floor we are likely to find significantly greater plumbing requirements, increased fire wall separation, reinforced foundation and sophisticated monitoring or tracking systems. Often the hallways themselves will be much wider than typical office building and handrails may be installed. Of course, you are likely to continue to find; safety lighting, increase sprinkler heads, special ceiling tiles and safety flooring. We can't go much further into the building without getting into specific tenant needs but you are likely to find features unique to medical facilities. Features such as telemetry, sophisticated call systems, biometric or customized security systems, and exotic tracking features. There are also more practical issues and needs that must be addressed in medical tenant space such as; special air filtering and exhaust, infectious waste disposal, unique storage issues, family meeting and grieving areas and even chapels.

There are many other special features and systems in healthcare facilities. However, there is at least one remaining material issue that clearly adds cost. All of the special, unique or important systems and features are expected to be transparent to the patient, their family and visitors. In today's healthcare environment, the patient and family expect and even assume the facility will be state of the art but user friendly, convenient and comfortable!

Bob Wehrmeyer is an experienced commercial real estate developer specializing in healthcare oriented development efforts, part time college professor and attorney, licensed in Texas. For more Articles like this one or to buy the authors book on the subject, "The Complete Guide to Developing Commercial Real Estate, the, Who, What, Where, Why and How Principles to Developing CRE", go to Amazon books or email Bob atbobw@wehrventures.com.

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