Building for subacute.

The first thing to determine when you are expanding an existing nursing facility is the reason for that expansion. In our case that reason was to create a nursing home that could serve our area's growing need for complex nursing and subacute care beds. That decision was the result of examining the care needs of West Palm Beach and the surrounding community, our experience with the existing 120 beds at Palm Garden (our facility), and the plans, strengths, and weaknesses of other nursing homes in the area.

We are increasing capacity by 80 beds to 200 and adding 37,000 square feet. However, just as important as size is the opportunity it creates. In our case, the expansion is a separate but attached private pay and sub-acute care facility that will also allow us to increase the number of beds in our dementia program from 20 to 45, and to put them all on the first floor of our current building.

Once you make the decision to go strongly into complex nursing and subacute care, much of the basic design for the new addition falls into place. To begin with, subacute patients should be segregated from long-term care patients, in our opinion, i.e., there should be separate entrances, dining rooms and activity rooms. The obvious solution is a separate, attached building. This also has advantage of minimizing disruption of our exciting facility.

Next you must decide specifically what services you will provide, although the choice is actually quite limited. Even though the nursing home industry is ready and willing to provide subacute care, Medicare still hasn't completely adjusted to this and isn't ready to pay us in many areas. A study identified 67 DRGs that had possibilities for skilled nursing care, and of these 48 could be treated by SNFs after 3 days or more hospitalization, but Medicare may not pay in all cases.

One hot item today for subacute care facilities is ventilator support, but we chose not to provide that service because we have a strong competitor nearby already up and running with this service. On the other hand, we are expanding orthopedic rehabilitation because there is both a need in the community and a window of opportunity in the marketplace. Two years ago, when we started providing subacute care, it was with a program for IV therapy, enteral feedings and seven-day-a-week rehabilitation therapies. Our new facility will allow us to serve seven area hospitals, rather than only three. We have also gone from serving nine orthopedic surgeons to 19.

Other areas we will be specializing in include respiratory therapy, dialysis, deep wound therapy, isolation, cardiac rehabilitation, and pain management. Each of these takes its own space and has specific equipment needs. All in all, it costs more to build for subacute care than for long-term care, and you have greater accounts receivable out per bed. Higher construction costs mean greater investment and/or debt service expense. The higher operating costs and billings associated with sub-acute care can tie up a lot of money for 90 to 120 days. Instead of the $200 a day of a typical Medicare bed, you could be talking $400 to $600 per day for the new services. Subacute can, in short, be tripling your receivables and your costs.

Not to be overlooked during the planning stages are two aspects which might seem obvious but can get overlooked until too late in the process: zoning and adequate fire and police service. You could spend a fair amount of money and time on development of plans, only to find a zoning violation lurking there, or that the emergency services available to your locale will not support your project.

Once you have decided on the type of facility you want to build and the services you will provide, the most important thing you can do is to engage an experienced architectural/engineering firm. By experienced, I mean a firm that has designed and overseen the building of nursing homes and, hopefully in this case, hospitals. You do not want the firm you pick to "go to school" on your project.

With designers on board, you need to prepare a detailed list of the specifics you want for your expansion. And once you have decided on these needs, they should be put in writing and agreed to by all parties--architect, engineer and construction company.

The interior appearance of the addition is also a critical decision. What sort of patients are you likely to get, and what style of decor might they expect? A facility in West Palm Beach, Florida is going to or at least should--look and feel different from one in Bangor, Maine.

As construction proceeds, the nursing home administrator has the ongoing responsibility to observe and verify that the building is going up as specified. You can't simply rely on the general contractor, architect and engineer. There has to be complete communication and cooperation with the construction company. Weekly meetings with the contractor and sub-contractors are crucial to coordinate activity and correct problems.

We almost learned this the hard way. At one point during construction, we had a sprinkler system going through an air conditioning vent. Solving that problem involved architects, engineers, and two sub-contractors, but at least we did so on time, before a great deal of work had to be undone. Without careful oversight on the part of the administrator, problems like that can become unplanned expenses and take a project over budget.

The construction phase of a subacute addition is a busy time for the nursing home administrator for several reasons. Many operational decisions must be made before the building is up and ruining--for example, developing and hiring the medical staff. We are four months from opening our addition, and I have most of my key people lined up and ready. That meant finding an internist to be medical director of subacute care, a psychiatrist to be director of the dementia program, a medical director for the orthopedic program, a physiatrist medical director for the orthopedic rehabilitation section, and other on-staff physician specialists. In addition we have had to find more laboratory, x-ray, and dialysis technicians and physical, occupational, and speech therapists. Then there are the registered nurses who need to be trained in critical care for emergency situations in all our subacute care areas. And finally, we must make sure that we have the support staff needed to take care of a 67% increase in patients.

We are also marketing our new services, even at this early stage. We have assigned one of our registered nurses the responsibility to advise local hospitals, doctors, and other referral agents about the services we will be providing and when we will be ready to accept patients. We also asked the hospitals to send us names of candidates for our medical staff, particularly specialists. It is extremely important to get physicians on our staff from the hospitals that will be placing patients so that we have a continuity and level of care that meets their requirements.

In conclusion, we think that subacute care is going to be the principal driving force behind nursing home additions in the future. This will require a commitment to change in the nursing home industry. We were able to increase our beds by two-thirds and greatly expand our subacute care services because ownership, Florida Convelescent Centers, working with management, National Health Corporation, was willing and able to make a $4 million commitment.

In the past, a 120-bed facility in our area was an efficient size, but as nursing homes move into subacute care and step up to a higher level of service, I think we are going to see more 180- to 200-bed facilities. The survivors in this increasingly competitive industry are going to be the companies with the resources to build and manage nursing homes of that size, thereby taking advantage of the economies inherent in a larger-scale operation.

Nursing homes are going to have to grow in size and the services they offer, or die. That means nursing home administrators and their staffs are going to have to get ready for a process of expansion, much resembling the one we have just gone through.

RELATED ARTICLE: WORKING WITH GENERAL CONTRACTORS

How do you select a professional general contractor? What should you expect from the contractor once the job is underway? Harley Miller, executive vice president of Miller Construction Company (Fort Lauderdale, FL), and builder of the West Palm Beach Healthcare and Rehabilitation Center described in the accompanying article, offers these pointers:

Research the contractor's reputation. Ask for a complete list of references, choose four or five names at random--preferably other nursing facilities--and ask about the g.c.'s performance. What is the company's track record for finishing projects on time and within budget? Did the g.c. look out for the owner's interests? Were on-site subcontractors professional and courteous? How did the company respond to problems after the job was completed?

Look into the g.c.'s financial stability by asking for an audited statement. Finally check out the company's lawsuit history by consulting public records. A large number of suits is a warning signal: the g.c. does unacceptable work and/or can't resolve differences with customers, subcontractors and suppliers

After hiring a contracting firm:

* Keep the construction team accountable with a timeline. The g.c. should work closely with you in creating the timeline so you know precisely what's scheduled to happen when. This is critical to accommodating residents and staff. Also ask for daily updates so you know the job is on schedule.

* Expect the g.c. to be flexible. While it's important to plan ahead, sometimes situations will arise--especially if work involves resident areas--that necessitate changing the schedule. The g.c. should readily accommodate your wishes.

* Plan logistical details up front, such as parking for construction workers, staging of materials and equipment, and handling exterior work to avoid on-site traffic snarls.

* Choose a key employee as your project manager. Someone on the nursing home's staff should have an overview of the job and keep tabs on daily progress. The project manager can also be a liaison between the g.c. and your on-site employees, keeping them informed or work schedules, for example.

* Ask the g.c. for a full-time, on-site construction superintendent to make decisions without delays, accurately answer staff members' questions and manage the work crew. When possible, the same manager should oversee your project from start to finish.

* Separate construction supplies and crew from resident areas. Consider remote entrances for the construction crew, or speak with your g.c. about creating temporary entrances for their use. Plan a separate area for construction supplies away from living areas and public spaces.

* Expect an open book and full accountability. Administrators should be fully apprised of costs at regular intervals--at least monthly--throughout the project's life cycle. The best firms will provide highly specific accounting printouts, breaking out payroll and labor costs as well as materials.

Remember that construction is bound to cause some minor inconvenience. However, knowing how to select a top-notch g.c. and work effectively as a team will help ensure quality work, delivered on time and within budget, that improves your facility for residents and staff.

Established in 1973, Miller Construction Company provides a wide range of construction services for South Florida's private sector, including nursing homes, hospitals and other healthcare facilities.

Howard H. Nehlig, Sr., NHA, LPN is Administrator of Palm Garden of West Palm Beach Healthcare and Rehabilitation Center. He has been a nurse and nursing home administrator for 39 years, and has overseen the building of two nursing homes in Illinois, where he has also worked as a consultant for the architectural firm of Bradley and Bradley.