Healthcare Masterplanning: Making Healthcare Estates more commercial and sustainable

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  • Healthcare Masterplanning: Making Healthcare Estates more commercial and sustainable
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Despite the wave four funding offered in December 2018 to NHS Trusts, we are now in an era where there is less real healthcare capital expenditure in the UK. With a relatively modest public capital of £1bn per annum for new buildings, some relatively small other government investments (some new but most existing)no announced successor to PF2, and fresh from the debacle of Project Phoenix three years of pain, the clear tenet for all healthcare providers will be increasing self-reliance for project capital, says RLB’s, National Head of Healthcare, Conor Ellis.

So, what does this lack of real expenditure look like in terms of estate management?

This budgetary deficit is reflected in the poor condition and unsuitable buildings of our healthcare portfolio with a £5.55bn in backlog in building facilities that need to be brought up to the required standard. We now have many Trusts that have declared £50m or more high risk/significant capital backlog. Presently we have extensive duplicated services and high fixed costs in our healthcare estates.  We assemble on site and we are ‘build focused’ rather than commercially focused.  We plan projects as components – architecture, FM, financing and commercial – yet many of the schemes we see may well not be sustainable, and certainly not profitable.

Integrating stakeholder views and balancing aspirations

With less capital, we need to drive commerciality forward, while aiming for aesthetic, functional and sustainable buildings. Design and construction does not go wrong at the end of the project, it goes wrong at the beginning.  Estate management processes need to become more astute and build the key stakeholders into the project at the beginning of every build, redesign or redevelopment.

Transforming care

Transforming care needs to be looked at not only strategically as within a local process but more radically, if we are going to get a solvent and sustainable system rather than ad-hoc responding to immediate needs.

We collectively need to demonstrate the future vision that will transform care by examining the process improvements and monetarising the impact or patient benefits. We need to ask the questions:

  • What facilities will be available in the future?
  • What processes will there be?
  • How short can we make the patient journey?
  • How much technology have we utilised?
  • What might be the changed relationship to other clinical departments?
  • How can we add value to our build or redesign?
  • How can we build in form following function, leaner solutions, more improved clinical outcomes and an enhanced patient experience?
  • How can we use LEAN process outcomes like Carter Metrics and use a baseline of admissions avoidance as alternative studies constantly show 25+% of cases could occur out of the hospital?
  • How can we standardise facilities to the same room, same concept as we presently know there is too much specialty specific space dedication?

All projects need to answer the four fundamental issues (below) that marry to NHS England’s Long Term Plan  and present a balanced scorecard for delivering commercial, sustainable and aesthetic facilities and projects.

Issue Outcome
Improving the environment Projects must be sustainable, improve the patient, staff and visitor total experience and reduce the build impact.
Cost efficiency reducing annual operating cost Commercial and public sector cases increasingly need higher return on investment – be radical with all project areas and lifecycle costs
Reduce backlog maintenance Schemes must impact on decreasing high & significant backlog
Function Invest strategic design time early – IT enabled making the most difference to users and standardising components.

The key to success will be how we drive commerciality and operating processes within our healthcare estates.  Taking ownership over our estates and ensuring we have the best systems in place and are working to the maximum efficiencies have been the way forward for the best Trusts for the last three plus years.Driving Commerciality & Operating Process

Activity needs to be benchmarked, as do workforces and equipment with facility management evidence-based methodology.  We are already presuming off-site manufacturing will take place by the end of 2019 that will use technology like BIM to improve delivery and outcome but we also need to continue to measure economic sustainability like BREEAM Excellence and SKA ratings.  Healthcare simulation software will help inform decisions, improve systems of care and maximise resources. We also need to look at commercial assets being fully utilised in both public and private sector settings.

We believe that in following the Treasury and NHSI good practice guidance, the NHS should look at a range of healthcare settings to consider an ideal mix of shared assets, dispose of those assets that are not efficient, and reinvest via public sector joint venture investment.

The Future Healthcare Estate

We want highly flexible and utilised buildings that are aesthetic yet functional.  They are likely to be assembled off-site, BIM enabled and have sustainability built into their design.  They will have built integrated design and commerciality from the beginning and be revenue optimised.  And it is likely that they will be funded through mixed funding method – NHS capital, public sector partnerships, England’s Estates and Technology Transformation Fund (ETTS), Healthcare Management Trusts (HMT) and Independent Trust Financing Facility (ITFF) – though most are unsure as to where private sector capital plans will go after the Chancellor’s Autumn statement. Yet without private sector capital, the circa direct NHS capital investments of £1-2bl per year will make less impact than the politicians, our health communities and the local NHS staff want.

Moving forward: A conclusion

We should aim for more dynamic integrated working with regular project objectives reviewed. We must say “No” to wasteful practice and avoid death by analysis by being more decision orientated.  Technology needs to be embraced – such as virtual and augmented reality, future BIM developments and Revit design – and there needs to be an acceptance of alternative financial ventures such as sovereign wealth funds and use of local authority investment in pension plans to help finance our healthcare estates.

Meanwhile we see evidence that even existing capital demands are growing over that originally envisaged. No one disputes best value-for-money from public capital, but if it isn’t there, it needs an alternative. Here’s the thing, private sector capital is now cheaper than it has been for decades to the point that there’s deals possible below Treasury rates -just at a time when the private sector are being pushed from the table by politics.

In conclusion, to change the state of our healthcare estates we need to change the way we think, learn the lessons of procuring for value, standardise the brief, build off-site and act more decisively to ensure that we can build and maintain a healthcare infrastructure that takes us forward into 2030 and beyond.

Case Study – Brighton General Community Health Hub

The Challenge:The aim was to build a multi- purpose primary & secondary health hub on the Brighton General Hospital site in East Sussex. The project had been proposed yet stalled due to an affordability gap of £ 44m highlighted by the previous consultancy design team.
The Solution:RLB linking with the One Public Estate looked at ways to improve the commercial site planning. Still achieving a balance of health and social care facilities, the new plan would reduce the onsite area to 10,863m² while optimising capital receipts from the sale of surplus land, new revenue streams, accurate forecasting of whole-life costs, lower operating costs and facilities management efficiencies.
Positive Outcomes:Working with Brighton & Hove City Council and other stakeholders, the Rider Levett Bucknall team looked to provide patient care, residential and affordable housing, commercial opportunities and jobs on the site while delivering a complete local sustainability agenda, rethinking not just the building itself but the entire future site.