Planning, Design, and Construction
of Cost-Effective Inpatient Hospice Facilities
John E. Ramsay, Jr., AIA, NCARB – Principal & Board Member
Introduction
In contrast to programs that provide hospice, palliative, and respite care to patients at their homes or in acute care settings, there is a growing trend for healthcare systems to establish specialized facilities dedicated to comprehensive inpatient hospice care. Such facilities are typically free-standing, are located outside of a healthcare system’s main hospital or care facilities, and are intended to offer a separate space where individuals may experience their final days with dignity and with as little pain and discomfort as possible. They are spaces that emphasize quality of life for terminally ill patients rather than continued and aggressive treatment normally associated with hospitals or skilled nursing facilities (SNFs).
As is the case for any specialized healthcare environment, architectural services obviously play an instrumental role in the aesthetic form, the effective function, and the ultimate success of these inpatient hospice facilities. And innovative architectural design offers a key means for cost-effectively meeting clinical operational requirements while at the same time positively impacting patient mood, creating a space where individuals may die in a dignified manner, and establishing an environment conducive for family members to best participate in and cherish the remaining time with loved ones nearing the end of their lives.
Planning & Design
Traditional inpatient hospice care facilities often have been modeled after skilled nursing and other acute care facilities. In recent years, this approach has given way to much more resident-focused concepts and personalized environments that actively attempt to reduce the visibility of clinical and back-of-house operations, thereby enhancing the home-like hospice experience for patients and their families. The actual architecture for inpatient hospice facilities has trended away from the more purely functional and therefore “institutional” look to designs that create much more of a resident- and family-centered atmosphere. While still conforming to the regulatory and palliative care operational needs, designs for these facilities must now stress the dignity of patients, their privacy and security, and their overall experience at the end of their lives.
But what exactly does it entail to design and develop an efficient, cost-effective inpatient hospice facility that fully meets the palliative care and other less tangible needs of the patient population, as well as serves the needs of patient families and facility staff? There are multiple significant challenges, not least of which is the inherent difficulty in maintaining a positive revenue stream under the current reimbursement levels of the Medicare Hospice Benefit (first established in 1982), other private insurance reimbursements, and individual payments. Other challenges include the approximately 9-12 months that it generally takes to plan, design, and obtain approvals for the construction of a new inpatient hospice facility. In many ways, the decision to build and establish an inpatient hospice facility within a
community hinges on the achievement of other benefits, several of which are not necessarily financial in nature.
Consequently, efficient and effective inpatient hospice facilities can only be realized when comprehensive planning and responsive architectural designs help achieve the proper balance among healthcare system needs, regulatory requirements, and capital/operating costs. This balance is imperative in order to reduce financial exposure of the healthcare systems undertaking the building programs. By nature, innovative hospice designs must effectively address hospice operational requirements (such as acute pain and symptom-management care for patients), establish a comforting environment for patients and families experiencing end-of-life care, and create a positive space for staff and volunteers to work.
One of the essential upfront considerations for designing and constructing a hospice facility consists of identifying the proper site. The best designed hospice facility can become “just another building” with limited appeal if the site selected for the proposed facility is not suitable. Specific examples of unsuitable sites include:
Too Small: Sites need to meet local planning department criteria for zoning and acreage, but in most cases, local planning design standards should be considered minimum standards. Having adequate space to keep automobiles and pedestrian circulation separated and preserving pleasant views from patient rooms and public facility spaces is extremely important to the ultimate success of the hospice house. A facility that has family living and dining spaces with views of the loading dock and service entrance, or patient rooms that open out to a parking lot, is clearly not desirable and can contribute to the ultimate failure of the facility’s economic viability.
Too Isolated: While rural, isolated sites can have great appeal due to the quiet, peaceful surroundings, the capital costs to establish road access and utility services (electrical, water, and sewer service) can be significantly higher. Rural sites can also have limited water pressure, requiring expensive booster pumps for sprinkler systems. Or they can have unsuitable soil for sewer septic systems and road paving. And finally, the market advantage of offering a hospice house can be lost or diminished because no one can “see” the facility.
Free/Donated Property: Like the problems identified with the “isolated site,” property that is “donated” frequently comes with many of the same issues, which are costly to correct. In addition, lots of “free” property comes with floodplain, buffer, and other easement issues that can limit development and construction options.
Because of the various potential pitfalls described above, thorough economic analysis of the total site development cost is critical to a successful project.
Feasibility Study
Another critical initial step in the process for a healthcare system to decide to move forward with an inpatient hospice facility is the completion of a realistic and accurate Feasibility Study that examines all aspects of the proposed development. The specific expenses addressed in the study should include the capital costs – those associated with land acquisition, site access, sitework, storm water detention, walking paths and landscape amenities, facility construction, architecture and engineering fees, financing costs associated with bonds or loans, and furniture, fixtures, and equipment (FF&E), etc. – as well as operating expenses to support ongoing daily operations – staff salaries, consumables, linens, medications, and facility maintenance/life-cycle costs, etc.
The study should also include cost/benefit analyses based on choices related to various facility features. For example, all hospice facilities have patient care rooms. The minimum size for a patient bedroom is typically specified by licensing regulations. Hospice regulations have frequently evolved from nursing home and hospital regulations. For example, in North Carolina, the minimum size for a private patient care room is 100 square feet exclusive of closets, toilet rooms, vestibules, or wardrobes. This size is not suitable for hospice care due to staff service requirements and the large number of visitors and family, some of whom spend the night in the room with the patient. We have found patient care rooms with 200 square feet to be the adequate minimum recommended size to achieve the appropriate balance of cost and quality care. As another small example, the establishment of a play area for children carries cost
without direct commensurate revenue generation. However, having such an area can be an attractive facility attribute with other worthwhile benefits, such as allowing family members and visitors with small children the flexibility to spend additional time with the hospice patient.
Also key to any initial considerations is an accurate gauge of potential financial support within the community that can be used to defray future expenses associated with building and maintaining the hospice facility. Community support for a capital campaign can result in a debt-free facility, greatly reducing cash flow demands for debt service and consequently improving economic viability. Crucial questions include: Is a community going to provide support beyond just donating to build the facility or are they also willing to support the ongoing operations of the facility? Communities are often more willing to support the initial construction costs rather than providing regular ongoing donations required for operational support. It is imperative that communities display a financial willingness and means for adequate fundraising efforts to bring an inpatient hospice facility into operation and ensure its ongoing success. It should be noted that equally imperative is the existence of dedicated programs to leverage this community willingness (i.e., staff development directors who coordinate fundraising efforts). As part of the Feasibility Study process, therefore, specific tools such as preliminary schedules/budgets, renderings, elevations, floor plans, and other information pertaining to the proposed facility are typically geared toward supporting fundraising initiatives and efforts.
Along with potential financial support, healthcare systems should take a close look at existing market conditions to determine whether there are hospice needs within the community that are currently not being adequately met (up to and including a formal Certificate of Need or CON process). Often, inpatient hospice facilities can serve to fill an important void within communities. If required to establish a formal need, the architectural design firm works closely with the client and healthcare consultant to develop a CON package that is delivered to the relevant state-level regulatory agency. Typically included within CON applications are a project description, a brief scope of work, a parking assessment, space programming, schematic budget estimate, a project milestone schedule, a site plan, and floor plans. Other areas to examine as part of a market assessment include the potential existence of robust patient referral sources throughout the community, such as nearby hospitals, private physician practices (e.g.,
oncologists), nursing homes, retirement communities, and churches. Such resources can be best cultivated through staff units dedicated to patient recruitment.
Additional important considerations hinge on the specific governing regulatory requirements and processes that are specific to individual states. For example in North Carolina, the entity with local approval jurisdiction is the North Carolina Division of Health Service Regulation (DHSR). In South Carolina, it is the South Carolina Department of Health and Environmental Control (DHEC). In Virginia, it is the Virginia Department of Health. In each case, the proposed hospice facility must meet all
state-specific standards, in addition to other complex federal laws, building codes, and zoning and other related development requirements.
Construction
Like any other construction endeavor, the construction considerations for an inpatient hospice facility will impact overall costs. As noted above, an initial evaluation of these costs is best conducted as part of the Feasibility Study. But during design development, the specific parameters for construction are fully fleshed out. Questions concerning site zoning, as well as water/sewer and electric utility availability and tie-in are answered. Other elements include specific facility size and layout on the site, overall site grade, soil conditions, existing trees, required site and landscape buffers, location of miscellaneous structures, re-location of existing structures, etc. Decisions regarding low- and no-impact construction (i.e., “green” and sustainable design/construction or potential LEED certification) are also crucial, as both a potential cost-driver and ultimately as a unique selling point for the facility. Investments in energy-efficient structures with energy-energy-efficient equipment that are encouraged by sustainable design practices can justify additional initial cost due to the life-cycle cost savings potential.
Construction costs for hospice facilities typically range from approximately $180 per square foot to $280 per square foot, depending on site conditions, quality of construction, and facility size. When making final construction decisions, it is important to remember that most hospice patient funding comes from Medicare and Medicaid. The reimbursement rates are the same regardless of how much is spent on the construction and operation of a new hospice facility. Larger, more expensive facilities often have more and higher operating expenses, and this financial burden stays with the facility forever.
Consequently, final construction decisions must be based on the thorough cost assessments completed throughout all phases of the design process.
Benefits
When architectural services for an inpatient hospice facility are handled correctly, multiple benefits become obvious. First and foremost, the facility owner is able to establish a palliative care environment that can be far superior to in-home hospice programs. The building embraces the ideas of a home-like setting with a relaxed, contemplative natural environment to promote comfort for patients and their families. The interior finishes are consistent with residential care settings, and meditation gardens along with other natural exterior spaces enhance this environment. But in addition to essential patient rooms and family spaces, the hospice facility provides required comprehensive patient services and clinical needs, as well as other resources on site, such as bereavement counseling, spiritual services, social service coordination, and educational awareness programs. With proper planning and innovate designs,
these environments can be achieved without fully sacrificing economic viability. For example, such new facilities offer an opportunity for cost-effective consolidation of operational and administrative functions for the healthcare system’s overall hospice program.
Other more intangible benefits are even more important for existing healthcare systems. A new and economically viable facility provides significantly increased visibility for the system within the community as more families experience an inpatient hospice environment. Such visibility offers the healthcare system a distinct competitive advantage within its marketplace. Furthermore, with increased community awareness comes more effective fundraising efforts for all aspects of the healthcare system, not just those affiliated with the hospice program. This can be especially true if the facility becomes a “centerpiece” feature of the community (e.g., as a LEED-certified structure), and in turn functions as a source of pride reflecting the distinct quality of life within that community.
ABOUT THE AUTHOR:
Mr. Ramsay is a registered architect in North Carolina and graduate of North Carolina State University with a degree in architecture (with honors). Mr. Ramsay has been with GMK for 15 years and brings a total of 35 years experience and an extensive background in facility planning and design to the GMK team. In his role as principal architect in GMK’s Raleigh office, he provides programming, design supervision and construction administration for each project under his purview. Mr. Ramsay is a licensed general contractor with field experience in plumbing, HVAC and electrical installations. He is also a graduate of BURSI (Better Understanding of Roofing Systems Institute).
SOURCE: GMK Associates, Inc.
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bvonlehmden@gmka.com ABOUT GMK:
GMK Associates, Inc. (www.gmka.com) is a multi-disciplinary planning, design, and construction services firm focused on the healthcare, education, government, utility, senior living, and hospitality industries primarily within the Carolinas and Georgia. Established in 1966, the firm is based in Columbia, SC, with satellite offices in Raleigh, NC, Greenville, SC, and Augusta, GA. GMK employs close to 70 professionals and is comprised of five distinct divisions — architecture, engineering, interior design, design-build, and construction services.
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