Warning to Hospitals: Baby Boomers Are Coming!

Managed care-driven changes in care delivery and reimbursement have caused a lot of hospitals to close beds and convert nursing units to outpatient centers. But some health care planners are warning hospitaladministrators not to become myopic: Giving up beds and renovating units now could come back to bite in about 10 years, when baby boomers will need more inpatient services.

That’s not to say hospitals shouldn’t make improvements to meet today’s market, but Jim Hannon, a San Francisco-based senior vice president for the Smith Group consultancy, says meeting immediate needs should be done with flexibility in mind.

When renovating a nursing unit, for instance, “Make sure you’re putting things in the right place,” he says. Consider whether a departmental expansion will force renovations in an adjacent department that is likely to face change soon because of market conditions.

“We encourage master planning,” Hannon says. Rapidly changing reimbursement patterns have led many administrators to say, “I’m going to stop master planing, because my horizon is one to two years out.”

This, he says, has led to situations where “winners are supported and others aren’t.” Community hospitals that offer a range of services are cutting those with declining reimbursement: Mental health, Hannon says, is one example. “We’ve seen several cases where psych beds are closed and reclaimed for outpatient services, or are converted to med/surg beds.”

That’s where foresight helps. Create units that can be reconverted easily to inpatient areas, say architects. Some planners also recommend that hospitals hang on to licenses for high numbers of beds — even if beds are closed for many years.