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5 Ways Healthcare Reform is Actually Real Estate Reform

Healthcare providers are moving away from treating sick patients to making sure patients don’t get sick in the first place. That means a redesign for doctors' offices. Here’s a look at five real estate trends in the healthcare industry.

1. Convenient locations


You’ll see more doctors’ offices located away from the hospital campus and in areas that are easy to get to, according to panelists at Bisnow’s The Impact of Healthcare on Real Estate this week. Saint Agnes Hospital just opened a 20-doc medical center with primary care and specialty services in a former 38k SF Room Store in Catonsville, says Bonnie Phipps. The former CEO of Saint Agnes Hospital, Bonnie was just promoted to SVP and group operating executive of parent company Ascension Health.

Housing the medical center at a shopping center, 40 West Plaza, saves patients from having to park at a big hospital campus. (As a bonus, patients can pick up milk at Aldi and pens at Office Depot after seeing the doc.)

2. Patient-centered medical homes


The new Saint Agnes Medical Center is an example of what healthcare providers dub the patient-centered medical home. (With soft lighting and modern fixtures, Saint Agnes' new building is also designed to look more like a spa.) A team of doctors work together to keep patients from being readmitted or admitted with preventable conditions because federal health reform gives them an incentive to do so. 


The patient-centered medical home cuts out waiting rooms and individual doctors’ offices. The team of doctors is responsible for managing a population’s health, says GBMC HealthCare CEO Dr. John Chessare. The docs know, for instance, how many diabetics they have, and will reach out to patients to make sure they are managing their condition.

Last year, GBMC HealthCare redesigned one of its primary care offices to include these design details. The $1.1M facility is modeled after Virginia Mason Medical Center in Seattle and Toyota’s lean production system. Johns Hopkins might follow suit with some of these design principles, with a 30k SF doctors' office at Seawall Development Co.’s Remington Row, under construction, says Johns Hopkins Medical Management Corp president Gill Wylie.

3. Targeted site selection


Picking the right site has become more crucial than ever, Gill says. He’s pictured (left) with Clayton Mitchell, Kaiser Permanente's executive director of national facilities services, mid-Atlantic.

In the past, healthcare providers would ask brokers what spaces were available, Gill says. Now they’re pinpointing where they want to open and the type of office they want.

4. Leasing vs owning


Finding spots in prime locations to build new offices can be a challenge in this region where space is at a premium. That’s why healthcare providers will likely sign shorter-term leases in existing buildings rather than construct a new office that they own. Bonnie says Saint Agnes tried for two years to find a location to build its new medical office (rendering), but when the search fell short, it renovated the former Room Store instead.

5. Adaptive reuse


Turning a big-box store that sells books or sofas into a welcoming office for patients has its challenges. Kaiser has done its share of adaptive reuse, but it isn't always possible to turn a retail store into a doc's office, says Clayton, here with NexCore Group healthcare development guru Tim Oliver. Kaiser took a look at an old Borders site to repurpose, but it didn’t have enough natural light and access to outdoor space.