A new report suggests that the hospital and health facility building boom will continue at least through 2010, when it's likely to exceed $60 billion. That's a big number, even by the industry's current standards. In fact, it's double the amount the industry spent in 2004, according to the study backed by the Healthcare Financial Management Association and GE Healthcare Financial Services. Several factors are continuing to drive the boom, including rehab and construction costs for next-gen hospitals, the shift to delivering care in ambulatory settings and patient volume increases due to Baby Boomer demand. Construction also is being driven by hospitals' "green" projects, including designing facilities to be more energy-efficient and environmentally friendly.
Of course, given bond market problems, nobody's sure exactly how facilities will finance these projects, but revenue bonds, physician-hospital joint ventures, public-private projects and work with third-party developers all are options, the report noted. Apparently, researchers didn't think the ongoing stresses on the financial system would be enough to turn this ship around--since healthcare organizations pretty much have to find a way to finance these deals if they want to stay competitive. Still, it looks like a lot of these projects were launched prior to when the financial markets were hit by the subprime mess. A new construction-industry report has found that hospital and clinic construction starts actually are down this year.
To learn more about this research:
- read this Healthcare Finance News article
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