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Healthcare | Infrastructure

Healthy investments – more of the same or something different?

31 Oct 2019, by Amy Sarcevic

The health sector is undergoing seismic change driven by rapid technological innovation, increased demand from a growing and ageing population, budgetary pressure, and evolving patient and consumer expectations.

When planning and budgeting for hospital infrastructure in this context, Governments are often faced with a key decision: invest in more of the same, or in delivering something altogether different?

EY Director Isaac Bromley says, “The rapid changes and growth in healthcare have to lead the way in terms of how health infrastructure investment is made.

“Future investment will likely be a combination of new facilities, better use of existing assets and investment that enables technology, virtual and digitally enabled care.

“But the questions is, are we presenting decision makers with the best economic case for these different avenues for investment?”

Broadening the evidence base

With government spending on health totalling $180.7 billion in 2016-17 alone – of which  approximately $71 billion per annum was directed towards Australia’s public hospitals – ensuring procurers have sufficient data to inform future investment decisions is critical, Isaac highlights.

“With budgetary pressure – and increased public scrutiny of government spending – there is a growing need for a broad evidence base to help governments justify project selection. And by ‘broad’ I mean quantifying the direct – but also indirect – economic benefits of health capital investment,” he says.

“Competing sectors like Transport have a really far-reaching evidence base and a lot more analysis on the community and environmental impact of their assets. The evidence base for Health is generally a lot narrower, focussing mainly on health and financial outcomes. Ideally, we need to widen the conversation and capture the full extent of social and economic benefits.”

Moving towards a Precinct Model

Isaac hopes that expanding the conversation around capital investment outcomes will shift thinking towards the broader role of hospitals and how they interact with education, transport and community infrastructure as part of wider, integrated “precincts”.

“The value of hospitals to their communities extends far beyond healthcare,” he says. “We must start looking at the potential for hospital sites to be part of community well-being, and act as a catalyst for further investment from local government, industry, education, social and worker housing, community healthcare and other community facilities.

“The investment represents a once-in-a-lifetime opportunity to re-energise suburbs and add value to the community. Taking a more integrated view of hospital infrastructure as part of a Precinct ecosystem, opens up opportunities for strategic investment in new infrastructure with other government agencies or industry partners to share costs, optimise asset use and reap wider benefits.”

Flexibility is key

As well as the precinct discussion, Isaac says the key to handling the “moving target” of future hospital planning, is flexible design.
“Designs must be able to adapt to emerging megatrends, whether its building new facilities or retrofitting old ones. We need to start thinking about new care pathways and coming up with functional designs that can be flexible to rapid changes in the healthcare environment”.

“With the rise of virtual care, it’s looking likely we may need less space, and that the space we do require will be tech-enabled. Regardless of which projects we choose to invest in, it’s important that we incorporate functional design features to accommodate future ways of working.”

Unlocking the potential of healthcare technology

But it’s not just building designs that warrant further consideration, says Isaac.

“Rapid technological innovation is changing the way health care services are delivered, with data, robotics, genomics and medical research allowing us to rethink traditional models of care.

“Technology and innovation will also drive far more flexible approaches to asset ownership and facility design. These factors are leading to a new health ecosystem, with more players entering the sector – each bringing with them bold new ideas that mobilise digital and tech capabilities.

“A key challenge going forward will be justifying the redirection of physical infrastructure investment and providing decision makers with the evidence they need to choose virtual or technological options instead.

“Changing how we invest means facing up to the challenges and generating transformational investment proposals that respond quickly to the pace and scale of technology and innovation, with the patient at their core.”

Isaac Bromley  is a Director in EY’s Infrastructure Advisory team, specialising in Health Infrastructure.  Isaac will be sharing further thoughts on this topic at the National Hospital Infrastructure Conference, due to take place 4-5 December 2019 in Sydney.

Learn more and register.

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