Following an opening keynote by Paul H. Keckley, PhD, executive director, Deloitte Center for Health Solutions, on the far-reaching implications of healthcare reform, a morning plenary session at the ASHE PDC Summit set the scene for how this climate has shaped, and will continue to shape, building projects.

Teri G. Fontenot, president and CEO of Woman’s Hospital in Baton Rouge, La., shared the story of her facility’s new campus and how what was originally planned to be built took a new course in light of the business environment that eventually unfolded.

The nonprofit, community-owned women’s hospital was landlocked in its original location in a time when it needed to grow. Leadership focused on the overall patient experience—looking at things like avoiding patient moves during stays (for example, from a labor and delivery room to a post-partum room), separation of distinct spaces (for example, the ambulance entry away from patient discharge), and support for advanced technology (such as a state-of-the-art surgery system that forced the hospital to take other rooms offline to accommodate it).

In 2002, a golf course was purchased by Woman’s for $5 million—a place where growth could take place some day if needed, or an asset that could easily be sold if not needed. However, the location was eventually identified as an ideal spot for the new campus.

So Woman’s got to work on designing what it wanted the future of its care delivery to be, brining in members of the community and staff alike to contribute to the process of establishing that vision. But in 2009, in the midst of an economic downturn, Woman’s was forced to halt construction. However, the pause in work proved to be beneficial, allowing the hospital to reevaluate its original plan and instead respond to the current market, and not what had been in place years before.

“We decided we didn’t need to build out as many beds as we’d planned,” Fontenot said.

Resuming the project in 2010, Woman’s attacked its new building on a smaller scale and adapted it with a new focus on what was truly needed. The result is a campus with all-private patient rooms (including the NICU), family spaces, and nature elements (including a one-mile walking path).

The new hospital’s been open for six months now, and Fontenot says there are still some things being ironed out, including learning new departmental adjacencies, footprint, and scaling—and living with what had to be value-engineered out of the project during that 2009 construction halt. “We now have a building, and we’re trying to train it to be a hospital,” she said.

Already, Woman’s has built out one of its shelled NICU pods and is considering adding an additional post-partum area, too. And a new financial environment plays a role, too, with the hospital going from a 10-12 percent operating margin before the project to about 1.5 percent today, at the same time Medicaid reimbursements continue to see cuts.

In a brief post-session discussion, Deloitte’s Keckley weighed in on the issue of right-sizing projects and reacting to new volume realities. “If in doubt, leave it out,” he said, noting that the industry had previously created demand by offering it an abundance of supply—but regulatory changes are nullifying that once-successful scenario.

“We tend to build based on lag indicators, rearview mirrors,” Keckley said. Instead, he advised thinking about not just building new main campuses but thinking about satellite locations within communities and retail-based care.

In Woman’s case, those ambulatory locations exist, too, but the hospital also had to consider that building a satellite hospital instead of a main campus would have likely led to undesirable patient transfers.

In the end, the building project it pursued was, in fact, the right fit. And, in this case, it’s paid off better than expected, thanks to another local hospital ceasing some of its services, which Woman’s has subsequently absorbed.