The Management Plan: The New Orthopedic Unit

Introduction

During times of worldwide pandemic, hospitals perform the most important function in preventing the tragic turn of events. It is essential to understand that a hospital is a complex system, which always needs technological improvement as well as more people to maintain these technological advancements. The design of a hospital can be functional (promote comfort and convenience) or nonfunctional (costly, uncomfortable design, which detracts from the quality of care). Therefore, healthcare facilities management examines confrontational elements to decide the best plan for the hospital. This management plan describes several points that aid in deciding whether to build, buy, or lease space for the new orthopedic unit.

Advantages of Building Space for the New Orthopedic Service Line

Building a new orthopedic service line comes with some benefits, such as the ability to modify the new space to hospital needs. For example, the medical facility enables complete control over the development of future orthopedic rooms. Furthermore, the hospital will harvest additional profits since the value of the real estate has increased over the years. This would bring the opportunity to lower the prices of medical treatment for the patients who cannot afford it, which will prove beneficial for the country’s economy (Duggan et al., 2019). Moreover, building a new orthopedic space will open the opportunity for easier access to quality healthcare if built in a strategic place.

Advantages of Buying Space for the New Orthopedic Service Line

The main advantage of buying the required space would be the time since buying is quicker than building. Construction works prove to be timely and even if a building is somewhat cheaper, buying is a more efficient usage of time. Therefore, as long as the hospital will be quick to install the required equipment inside of the bought building, it would benefit from the building as well as some tax advantages immediately (Bai & Anderson, 2016). Furthermore, buying would be advantageous in the long run, since the hospital pays once in contrast to lease payments. Buying the building would also spare the hospital from dealing with landlords, which would allow it to act at their discretion with the building without the need to ask the landowners first.

Concerning landlords, there is also the benefit of not paying more than anticipated. For example, the landowner can ask for one price at the beginning and then increase it justifying their action in the growing real estate market. Therefore, buying a building would prove to be cheaper in the long run. Purchasing more space would also mean improvement in customer service and an increase in employment, which would also be better for customers (Duggan et al 2019). Additional space would mean more income, similar to the business plan of building a new orthopedic space.

Advantages of Leasing Space for the New Orthopedic Service Line

Surprisingly, the cost of a lease is generally lower than buying or building a new space. The lease would have an immediate positive impact on the hospital’s profits since it generally reduces the tax payments. Moreover, there are no repair costs because all responsibility is borne by the landlords. It would be easier for the hospital to lease space because there is no requirement for several hard-to-make documents (Hareide et al., 2016). A lease would be the most efficient time spender, and there are lots of options for the hospital, unlike in the previous two variables. Furthermore, the process of leasing is less time-consuming, which, therefore, can be more beneficial for services and customer care.

Disadvantages of Building Space for the New Orthopedic Service Line

The main disadvantage of building a new medical space would be construction expenses. Moreover, while building, the hospital has to follow the government standards, which can prove to be problematic, depending on the land. Furthermore, to build something as important, the hospital is obligated to include a wide scope of specialists. For example, to make an appropriate plumbing system, the hospital has to invite several professionals from various fields of plumbing (Wagenaar et al 2020).

If the building has some defects, it would be fined accordingly and immensely. Therefore, a medical facility often cannot afford the risk to pay an excessive amount of money and overpays the professionals to make a better version of their building. Furthermore, construction works are extremely time-consuming, and the new space could be developing for many months, which would be a drawback to the service delivery of a hospital (Jandali & Sweis, 2019). Consequently, a medical facility has to commit its money and soul to the construction works.

Disadvantages of Buying Space for the New Orthopedic Service Line

Considering the disadvantages of buying space for a new orthopedic service line, the hospital would have to forgo some additions to the new room based on several factors: the location of a building, its space capacity, and secondary properties. It may be inconvenient for a medical facility to move from several bought buildings to move equipment (Wagenaar et al., 2020). The primary cost is higher than leasing because it includes the payment for expenses, taxes, and possible mortgage if the medical facility is not rich enough (Hareide et al., 2016).

Moreover, the hospital would have to consider renovation works based on the state of the building, which can sometimes appear even more costly than building a brand-new medical space. The work and the financial part would require more professional workers, which will significantly increase costs (Hareide et al., 2016). Furthermore, it is almost impossible to find a building that can be renovated as an orthopedic service line, which can create further delays.

Disadvantages of Leasing Space for the New Orthopedic Service Line

The first disadvantage of leasing space for the new orthopedic service line is the annual increase in costs, which can be included in the lease agreement. In certain cases, the landlords increase the price of rent when the lease expires or eject the hospital from the building based on different reasons, which will be a major inconvenience. This would mean that the medical facility would be in need to constantly move from one location to another (Hareide et al., 2016). Moreover, when the value of a building would increase, the hospital would not benefit from it since they are not the owners. Furthermore, the medical facility would have no control over renovation works and related factors, which is also a major inconvenience. The institution would have almost no place to expand they would constantly need the landlords’ approval over everything.

Recommendations

To conclude, the best option for the maximum benefit would be constructing a completely new building. However, in modern realities, considering the demand for medical help, it would be best to lease the property for some time while doing the construction of a new medical facility. The leased property is the best temporary decision since it would profit the hospital while the best option is being built. Building a new construct is more advantageous despite time and costs. Therefore, the hospital is better at building a new space and leasing another while the main one is being constructed.

References

Bai, G., & Anderson, G. F. (2016). A more detailed understanding of factors associated with hospital profitability. Health Affairs, 35(5), 889–897. Web.

Duggan, M. G., Gupta, A., & Jackson, E. (2019). The impact of the Affordable Care Act: evidence from California’s hospital sector. Institute Economic Policy Research.

Hareide, P. J., Bjørberg, S., Støre-Valen, M., Haddadi, A., & Lohne, J. (2016). Strategies for optimization of value in hospital buildings. Procedia – Social and Behavioral Sciences, 226, 423–430. Web.

Jandali, D., & Sweis, R. (2019). Factors affecting maintenance management in hospital buildings. International Journal of Building Pathology and Adaptation, 37(1), 6–21. Web.

Wagenaar, C., Mens, N., Manja, G., Niemeijer, C. E. A., Guthknecht, T., Lacanna, G., & Luscuere, P. (2020). Hospitals: a design manual. Birkhäuser.