Outsourcing healthcare facility development work

Healthcare Facility Development: Key Considerations for Effective Planning and Execution


A state run hospital enterprise implemented a PACS system across their hospitals. As we know PACS receives radiological image data from Imaging modalities such as xray, CT etc.,, stores and distributes the same thro the hospital network to referring clinicians across the hospitals thus creating a filmless environment. The overall efficiency of the hospital improved as PACS meets its purpose. However, clinicians weren’t fully happy for the reason that strain on their eyes increased reading images from PACS monitors.

Does this mean that medical images are better read from films than on a hi resolution PACS monitor? NO. Both display medical images at same brightness and contrast levels as they are originally configured. The other factor that influences reading is facility ambient lighting. Films are read from a back lit panel and hence ambient light hardly interferes. Appropriate facility lighting is very essential for PACS viewing.

Hence it is not just providing, space, furniture, power and network, healthcare facility requirements are getting more and more complex with various influencing aspects such as Technology, Expanding services, Business needs and a lot more.

The above quoted example is just one of the several considerations to be made while introducing a new service or preparing a facility and improper planning always leads to shortfalls and non-realization of total benefits of investment.

Who is responsible for ensuring ambient lighting requirement in the plan? The Equipment Vendor or Architect or Electrical consultant or the Contractor or the hospital administrator who managed the project? Whoever may have missed this in the process, ultimately it is the organization who suffers.

There are two important things an organization needs to look into when introducing a new service or building a facility. One, identify appropriate facility requirements and two, identify the right approach in outsourcing the facility development work.

Who are the various stakeholders or service providers who will address these two?

The traditional and the most popular choice is an Architect who will plan the facility and a contractor who will execute it. Architects design spaces and furnishing required for the core service or function and any other special requirements are usually passed onto respective consultants. In this case, the buying organization ends up in doing the total project management, ie., determining the scope of facility requirements, managing the cost and time. Scope determination is the most difficult task in any project and in this case, the architect’s role in this limited by the complexity of the requirement. Scope requirements are generated from various sources such as the actual business requirements, Requirements from various equipment and services vendors, Requirements of various end users etc., Architects can do Cost budgeting but monitoring and controlling  the total project cost as per the planned budget lies on the head of the buying organization.

Hence if the facility under consideration is just  outpatient consulting rooms or renovation of an administrative office or a complete  facility that do not have any complex requirements, the above way of outsourcing will hold good. Otherwise the buying organization has to be  good and confident enough or have in house professional resources to do handle Project Management to determine scope, cost and time , execute , monitor and control while only outsource architectural, structural, furnishing planning and contracting.

Healthcare Architects are those who have specialized in healthcare facility design and or those who have substantial experience in developing the same. These architects are better than the general ones and hence the overall scope planning done better. Scope creep is drastically reduced as compared to the previous choice. Risks are reduced. Facilities with complex requirements are usually well handled by them. However, the overall responsibility of the buying organization in doing the project management remains the same with probably with a reduced load. Risks of cost and time overrun still exists and it depends on the buying organization’s ability to manage the projects.

This is a much better option than the previous one especially for developing more complex healthcare facilities such as a Surgical care center, a multi-specialty hospital with various services such as radiology, lab and OT etc.,

Of late, equipment suppliers and Services vendors have started to provide turnkey services to set up a specific department where their equipment and services are to be installed. In this case, these vendors have a clear advantage over Architects in determining the scope of work. In such case, architects, other service consultants, contractors are outsourced by these vendors and the final facility is delivered with their equipment and services in place.

Advantages are , equipment and service specific requirements in the facility are well taken care. This is very important as the technology keeps changing and from equipment to equipment requirements may vary. Even healthcare architects may default here with wrong assumptions based on their previous experiences.

For example, an architect would have worked with setting up an MRI room earlier where a water chiller is involved and he/she may always tend to go with an assumption that all MRIs would need a water chiller. MRI cooling requirements vary from manufacturer to manufacturer, model to model etc., Some MRI do not need water chillers at all.

Equipment vendors or specialty turnkey service firms run by professionals with substantial domain experience would be a better choice in setting up Radiology and Imaging diagnostic centers/rooms, ICU, OT, CSSD, Laundry, Clinical Laboratory, Radiation therapy, Server room, Central Medical Gas Supply, Cold room, Isolation wards etc., where equipment and services play a major role. It is certainly not a good idea to go directly to an Architect for such exclusive works. Architect’s role is very minimal here and  the turnkey service provider will drive the total project management. Specialists from various disciplines such as Power, HVAC, Mechanical and Plumbing, IT etc., will  be involved among which architectural planning will be one of the role.

Most projects of above nature are currently  being undertaken by traditional Architect/Contractor combination which is the cause of lot of scope creep.

Since turnkey providers do overall project management and the cost is usually part of the overall package which is fixed. So this also takes away the burden of Cost budgeting, Monitoring and control from the buying organization.

In this case, the buying organization still has to ensure the facility under consideration is well integrated with their existing facility. There are always risks of turnkey service providers underplaying certain specialty service areas where they lack knowledge. For example Air conditioning is very important specialty service and turnkey providers will know only the required specifications but not know how to achieve it. Still many take it for granted, design the solution by themselves which is cause of many equipment breakdowns. Buying organizations need to keep a vigil on such areas where corners can be cut by the turnkey providers either due to lack of knowledge or to contain cost.

There are healthcare consultancy firms who bring many services under a larger umbrella. Their services may start from Management consultancy, Strategic planning, Feasibility studies and survey, Services planning, Equipment planning and sourcing, Staff planning and recruitment etc., and also include facility design services , Project Management etc.,

They are the perfect fit for setting up larger size enterprise hospitals as they are a lot more than builders, bring in business perspective into overall planning. They also offer their services in loose form from their basket and hence even small to medium level enterprises can avail their services.

Unlike the earlier, these are experts in clinical domain who have substantial experience of developing, managing hospital projects and running them. They understand the business need and clinical workflow better than the earlier.

The buying organization has to carefully study their technical expertise in providing design services in their team compliment their clinical expertise. Any weakness in this may affect design and  development of technology intensive areas listed above.

Facility plays a very important role in healthcare business. More than providing a shelter for running the intended services, a good facility reflects brand identity, takes care of the equipment performance, safety, comfort of the patients and staff, efficiency of the services and hence overall business productivity. There are several players in the market to provide facility development services and  a broader classification is described above.

It still remains as a responsibility of the buying organization to determine the type of planned work, choose appropriate service providers, evaluate their credentials, scrutinize the scope of work and do contract management. In order to take care of this responsibility, larger organizations can set up a dedicated department for carrying out projects if expansion work is constantly undertaken. However, such in house departments have to be careful in building in house expertise. Many organisations have tried to get the entire resources from architects to consultants in house, but the growth of facility needs always goes beyond the scope of in house expertise. Requirements are diverse, there is always a need of newer skill set. So smarter organisations focus on their core services, keep a slim Projects team to take care of contract management, monitoring and control  of the outsourced activities.

Today, facility needs are going beyond having a bare minimum facility to run the intended services. Hospital acquired infection (HAI) is becoming a serious concern and patients are becoming more and more conscious of the healthcare facility environment. Hence facility needs to address better indoor air quality and contamination prevention. Fire safety concerns are already on fire in India now!

Environmental conditions such as humidity and temperature affects uptime of electronic equipment and hence HVAC design is crucial. A properly designed HVAC system can increase overall uptime by a minimum of five percent. With author’s experience almost more than say ninety percent of the HVAC in India are not designed for this.

Energy conservation saves operational cost. Hence facility can be innovatively designed to reduce consumption of energy.

 Organizations keep adding newer services and modification of the facility is inevitable. Hence re-usability of building materials is another factor to be considered. Almost sixty to seventy percent of the materials can be re used from a well-designed facility.

A patient and a worker can “feel” a well designed facility even if not aware of it! Hence healthcare organizations need to do a lot of home work to know what their investment on facility is going to fetch them and find who can help achieve their interests.

Suresh Muthukrishnan
Director, Uranus Innovation Turnkey Solutions Pvt. Ltd.​ | + posts