Our Health Care Real Estate Briefing is your comprehensive summary of weekly health care real estate highlights happening across the nation.
A number of stories involving hospitals and health care providers made the news last week. Our headline story includes a summary of health care trends that the consulting firm Sg2 published. The report makes predictions on where the growth will be in health care over the next decade. A number of other reports were released as well that looked at the current state of hospital finances, staffing shortages and the impact that non-profit hospitals make in their communities. In other news, hospitals continue to look for creative solutions to find affordable housing. One hospital system is looking to a local university and to AIRBNB for apartment units. Finally, a number of new development projects were announced across the country.
1. Sg2 released its 2022 Impact of Change Report. The report makes predictions about the demand for health care services over the next decade, including 1) Hospital inpatient volumes will recover, but growth will be slow; 2) Outpatient volumes will grow by 16%; 3) ASC services will grow by 25% and physician office services will grow by 18%; 4) Emergency department visits will continue to decline; and 5) Home health E/M services will grow by 19%, hospice services will grow by 13% and home PT/OT services will grow by 10%.
2. Kaufman Hall released its flash report for May 2022, finding that hospital operating margins are sitting at -3%; inpatient volumes, the average length of stay and the number of surgeries being performed in hospitals are all down; and operating expenses have increased by 8% to 9% due to labor shortages and supply chain issues.
3. The Des Moines County Property Tax Board of Review denied property tax exemptions for five properties operated by Southeast Iowa Regional Medical Center. The properties have a combined value of $224M, and the hospital system will now be required to pay $5.5M in property taxes per The Hawk Eye.
4. The American Hospital Association commissioned EY to analyze the tax benefits received by non-profit hospitals. EY found that non-profit hospitals received $12.4B in federal tax savings as a result of their exemptions while they provided $110B in community benefits.
5. Hall Render is hosting a 4-part webinar series on Virtual Care Strategies & Solutions. Register for the first webinar here. Hall Render attorney Andrew Dick also produced short posts on real estate strategies that hospitals can implement to improve their bottom line and joint venture strategies that hospitals can use to increase market share.
6. The Lebron James Family Foundation announced plans to develop a medical facility in Akron, Ohio called I Promise Health Quarters. The facility will offer medical, dental, optometry, mental health, pharmaceutical and lab services per Cleveland.com.
7. Hospital systems are looking for creative ways to secure affordable housing for clinical workers. One hospital in Texas plans to rent apartments from a local university, secure homes using Airbnb and potentially build its own apartment units per Becker’s Healthcare.
8. Staffing issues continue to plague the health care industry. Health care employment is down 223K jobs from the start of the pandemic and 60% of nursing homes say that staffing shortages have gotten worse since the start of 2022 per Skilled Nursing News.
9. A large development is being planned at the Armed Forces Retirement Home in D.C. The plans include a 320K sf MOB, a 310K sf assisted living facility and a 116K sf hotel per Washington Business Journal.
10. Next Level Urgent Care, LLC is planning 20 new locations by the end of the year, including 12 locations in Austin and San Antonio, several in suburban Houston and one in Beaumont per Bisnow.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot—outside of an attorney-client relationship—answer an individual’s questions that may constitute legal advice.
