Hospitals are still spending money to modernize campuses. Here's why

It’s a trend that started several years ago: As the healthcare landscape became more competitive – and patient experience scores became increasingly important – hospitals took a page from the hotel industry and began investing big dollars in facility upgrades.

And while supply chain and labor issues – not to mention rising interest rates – delayed some of those construction plans, hospitals are back at it again.

At November’s HLTH USA conference, I had a chance to sit down with Sven Gierlinger , the chief experience officer at Northwell Health , the largest health system in the New York metro area. Gierlinger spent the early part of his career with luxury hotels brands like the Ritz-Carlton and Kimpton before finding his way over to the healthcare industry almost 15 years ago.

Capital budgets are tighter these days, he acknowledged. But patient experience upgrades, he said, can help hospitals meet other goals, like improving efficiency and reducing wait times, all of which contribute to the bottom line.

Hospitals, meanwhile, are expecting the current capacity surge to continue, with an aging population driving demand. So while they may have pulled back on construction in 2020, many indicators suggest the number of projects is rebounding and, at the current pace, could soon return to pre-pandemic levels.

Business magazine Modern Healthcare , for example, tracked nearly a 20% increase in the number of construction projects that were completed in 2021 compared with the previous year, and a 22.5% increase last year in the number of projects that broke ground.

The trend appears to be holding. The American Society for Health Care Engineering (ASHE) found that the number of hospitals planning infrastructure projects increased to 16% in 2022, up from 11% the previous year.

Gierlinger, for his part, says half of his focus is on inpatient facilities while the rest is on ambulatory care. Top of mind for him: reducing clinical space and shortening wait times. “I’m on a mission to eliminate waiting rooms,” he told me. “We [shouldn’t] design waiting into the process.”

Other health systems too have been accelerating investments in outpatient care, including telehealth, urgent care and ambulatory service centers, according to Premier Inc. , a group purchasing organization and consulting firm. Projects with a focus on sustainability also have been a priority.

I asked Gierlinger what he learned from his time in the hotel industry that should be takeaways for hospitals.?

Luxury hotels focus on making a great first impression, he told me. Everything about the experience – from the parking structure to the music to the noise levels – are designed to elicit a sense of calm. You’re greeted by someone standing at eye level, rather than seated behind a large computer screen, like at most hospital registration desks. (“You can’t even see a head,” Gierlinger quipped.) Once inside the hotel, the staff makes an effort to get to know their guests, and tailor an individual experience for them. “I couldn’t think of a better use case than healthcare to do that,” he said.

Gierlinger arrived at Henry Ford Health System in 2008 after his own personal experience with the healthcare system. He had spent three months in a hospital with Guillain-Barre syndrome, a rare disorder where the immune system attacks nerves, resulting in paralysis. Recovery took a year.

“There’s a stranger in charge of your life,” he said, adding that in healthcare, “trust is probably the most important word.”

It’s not just about the feel-good aspects: bringing a hospitality focus to Northwell has had a measurable impact. Its “likelihood to recommend” scores are now in the 89th percentile for physicians (“in New York!”) For medical practices, those scores improved to nearly the 80th percentile, up from the 50s. And forget the old jokes about hospital food: satisfaction there climbed from the dismal 9th percentile to the 80th.?

But the feel-good aspects do matter too. “In healthcare, we get these letters – and you can’t help but cry,” Gierlinger said, referring to the gratitude people express about their hospital experience. “I don’t remember that people ever cried in the hotel industry.”?

What lessons do you think hospitals can take from the hospitality industry??