Health systems revamp facility plans to accommodate newly remote staff

As the nation commemorated the first anniversary of COVID-19’s arrival this spring, Novant Health in Charlotte, N.C., was preparing the official launch of a pandemic-spawned new normal. On April 1, its first “corporate hub” opened to accommodate a new hybrid work model.

“We’re moving away from assigned office or cubicle space to a hoteling model,” said Matthew Stiene, Novant’s senior vice president of construction and facility services. “Our expectation is team members will come to the office maybe two or three days a week and work remotely two or three days a week.”

The first corporate hub—two others are in the works—includes about 150 workstations, 85 offices and 14 conference rooms. Staff members use a phone app to reserve a specific space for the time they will be onsite. The building has been reconfigured to encourage collaboration on days that staff members are at the office.

The offices formerly used by senior vice presidents and vice presidents have been converted into small conference rooms, and those executives are using small offices. “We are creating more casual seating areas where people can just gather as a team,” Stiene said.

By pushing thousands of healthcare workers out of their offices, the pandemic accelerated a work-from-home trend that has been building strength for some time, said Angela Mazzi, a principal at GBBN in Cincinnati and president of the American College of Healthcare Architects. For medical planners, that means creating new types of workspaces—and introducing new terms to her clients. “It’s not just hoteling—it’s also about ‘touchdown space’ and ‘alternative workspace’,” she said.

Hoteling—such as Novant is doing—allows a staff member to claim a specific workspace for an entire day. Touchdown space is “Oh, there’s an open chair that I’m going to sit in. But the minute I leave, somebody else may take it.” The term “alternative workspace” describes anything from a breakout room where three or four team members can work together to a cafe-type setting to a collection of lounge furniture. “There’s a lot of loosening up of the idea that you aren’t working hard unless you’re sitting at your desk in a certain posture,” Mazzi said.

That is one of many concepts in healthcare real estate that have accelerated because of the pandemic, she said.

Looking more broadly across the industry, respondents to Modern Healthcare’s 2021 Construction and Design Survey said work is picking up—rapidly for some, more slowly for others—after last year’s pandemic-forced slowdown. Pre-pandemic trends, including more outpatient facilities and designs that allow flexibility in how a space is used, continue. But many health systems have different priorities, plans, project designs and budgets because of COVID-19’s effect on their patients and the economy.

“Health systems are currently evaluating their program delivery and determining what facilities they need to provide their updated services, as well as what to do with their underutilized real estate,” AECOM, a multinational engineering firm based in Los Angeles, said in its survey response.

Michelle Mader, managing director of strategic advisory services for Ankura, a Washington, D.C.-based firm that provides real estate and other services, agreed. “Most healthcare systems we work with are re-evaluating their real estate portfolio,” she said.

The work-from-home movement is freeing up space—scattered across hospitals, in on-campus medical office buildings or dedicated professional office buildings—which allows system leaders to reconsider the best use of their assets, she said. Office space that has previously been a cost to support administrative work can be redeployed as a money-making asset when it’s used for, say, a cardiology practice. “Health systems are keeping administrative people home and pulling specialty (providers) back onto the campus,” Mader said.

At JLL, which provides real estate and facility services, Richard Taylor, division president, saw a trend toward moving administrative functions out of hospitals and medical office buildings even before the work-from-home movement emerged.

“From a revenue standpoint, the hospital business model is supported by getting administrative space out of the hospital and into more traditional office space,” he said. “Then you repurpose that office space into clinical space and create a living out of it.”

When the pandemic sent many staffers at Texas Children’s Hospital home to work, Jill Pearsall, senior vice president for facilities, planning and development, and real estate services, and her colleagues recognized that the Houston-based system might not need all of the 270,000 square feet of office space it had been leasing. Taking advantage of “early out” terms on some contracts, the system will have relinquished 100,000 square feet of leased office space by September.

Texas Children’s will use a hybrid working model, in which many staff members work full time at home or part time at home and part time onsite. In addition to saving $3.6 million in rent each year, the strategy reduces the health system’s tab for shuttle services to get employees to and from those office buildings and parking fees for workers. Pearsall sees a longer-term financial benefit beyond the immediate savings as well. “This will allow more growth for the future that, if we had not gone through this work-from-home effort, we would have had to lease more space,” she said.

Blessing Health, a rural system based in Quincy, Ill., sent about 500 employees home to work when COVID-19 hit. A year later, the system is developing a new long-term plan for its real estate assets. “We are looking at how we can use our real estate very differently,” said CEO Maureen Kahn. “Because we now have a lot of open space where people used to sit that they’re not coming back in to sit.”

At Indiana University Health, James Mladucky, vice president of design and construction, is overseeing development of a new 4.3 million-square-foot campus in downtown Indianapolis. He said the growth in remote work during the pandemic has prompted re-evaluation of space needs.

“Flexibility is key,” he said in an email exchange. “The need for less costly brick-and-mortar space in the long run will … change work cultures for the better in healthcare and will help reduce the cost of care for patients and employers.”

Lola Butcher is a freelance writer based in Springfield, Mo.