Healthcare has been shifting from hospital-centric care delivery to lower-cost, decentralized outpatient settings for the last couple of decades. During the HCD Virtual session “Searching for Goldilocks: Is There a Right Size Hospital?” speakers William J. Hercules, CEO at WJH Health, Austin Purkeypile, COO at AdventHealth East Orlando Hospital, and Ozzie Delgado, COO at Cleveland Clinic Florida, discussed this transition and how it’s driving a new conversation in the industry.

“We have an over-bedded hospital industry—or better stated we don’t have the right type of beds built,” said Delgado. “Much of our hospital infrastructure is centered around the historical models of acute care, but over the last 20 years, the demand for acute care beds has dropped in favor or critical care and observation beds. The requirements for those types of beds are very different and may require renovation or replacement.”

As organizations consider their inpatient facility needs, several key business factors should be discussed prior to the pre-design phase of a hospital project, looking beyond market share to include various other groups like coordinating with the system’s consumer engagement (beyond branding and marketing) strategy, its contribution of financial margin over time, and understanding community needs and how those can be best met as a system. This may result in different solutions that previously considered, such as a general acute care hospital to meet the immediate needs of a community that feeds to a tertiary or quaternary care facility farther away to address specialty care, Hercules said.

So, is there a “right size” for a hospital? “The short answer is universally ‘no’, but specifically ‘yes,’” said Hercules. “The specificity relates to myriad market conditions, patient needs, physician skills, and availability—all over a defined period. Conditions will change over time—populations increase or decrease; disease prevalence and factors immediately outside of traditional treatment shift; and the skill, availability, and scalability of care teams vary.”

Market growth data, historical trended data, new regulatory changes from the Centers for Medicare and Medicaid Services, as well as the organization’s strategic growth plan in programming of service offerings help determine the right size hospital, Delgado said.

Hercules added, “These conditions are never static, which will require operational flexibility and facility adaptability.”

Purkeypile said there are a variety of questions owners and designers should ask related to a hospital’s initial size, ranging from “How likely is a competitor to build there if you don’t?” to “How much are you willing to pay for market share?” and “What drives consumer choice in your market—proximity or continuity?”

In summary, Hercules said there’s no perfect size or configuration that allow healthcare leaders to build and assume the operational model will continue perpetually. These models are requiring increasing flexibility. “As more disruptive innovation is introduced into care delivery, such as hospital-at-home, which may significantly reduce the demand for acute-care infrastructure, the places of care and other heavy assets will continue to be scrutinized for their long-term effectiveness in supporting the promises that health systems make to their communities,” he said.

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Tracey Walker is managing editor of Healthcare Design. She can be reached at