A Moment of Clarity

The 5-4 ruling handed down June 28, 2012, by the U.S. Supreme Court to uphold the Affordable Care Act (ACA) marks a watershed moment in the healthcare industry. 

And while the debate over whether it’s good or bad policy will likely rage for some time, what the decision does offer is a relief to an era of uncertainty for all those who are involved in the planning and construction of healthcare facilities, providing clarity regarding the future of healthcare—and what needs those facilities will need to fill. 

“The industry has just kind of been holding its breath not knowing whether to jump this way or that. So just having a decision is a good thing for the design and construction business,” says Kim Shinn, principal/senior sustainability consultant for TLC Engineering for Architecture. “A lot of people were really holding back, not knowing what the pro forma would look like in terms of covered people and requirements for coverage, and they didn’t know whether to go ahead and spend money or not.” 

One area upon which light has been shed regards the individual mandate for health insurance, answering the question of not only the size of the overall patient population but how much care hospitals and health systems would have to continue to provide to the uninsured. 

Chief Justice John Roberts concludes in the court's opionion that the mandate is not a valid exercise of Congress’s power under the Commerce Clause of the U.S. Constitution; however, it was found to be within Congress’s power under the Taxing Clause and may be carried out as such. 

Shinn says the decision to uphold the mandate will likely come as a financial benefit to the healthcare industry. 

“Because the individual mandate has been upheld, that’s actually going to probably improve the financial situation of hospitals overall. Even though there will be cost controls going forward and limitations on payment, the write-offs for having non-insured care will free up a fair amount of capital, and I think it’s going to be a good thing,” he says. 

However, it’s become clear as of late that the healthcare industry at-large is already on a trajectory toward reform, increasingly exploring new models of care that will better control costs through a focus on keeping patients well rather than on treating illness, which largely will take place through an outpatient and ambulatory care model. 

Andrew Quirk, senior vice president, national director, Skanska USA Building, Healthcare Center of Excellence, says he saw the high court’s decision as a reaffirmation of what health systems are already doing. 

“[Owners] have somewhat already accepted that reform is coming and they need to change. And they’re all moving toward the outpatient model, which is basically what is required. So their trains have already left the station about a year ago,” Quirk says, adding that even if parts of the law had been shot down, he didn’t anticipate health systems to divert from that path. 

In an interview posted on the Cleveland Clinic’s website in reaction to the decision on the ACA, Cleveland Clinic President and CEO Delos M. Cosgrove, MD, provides a similar sentiment. 

“The current cost curve for healthcare in our country is unsustainable … We can no longer deliver 21st century care within the framework of a 1950s-era healthcare system. We need to transform our idea of where and how healthcare is delivered if medicine is going keep up with the needs of today’s society and those for generations to come,” he says. 

And now with new clarity at hand, healthcare systems are better positioned to move forward in answering those needs through facilities projects, and Shinn believes a push will come sooner rather than later.