Smart growth: Using population data for strategic healthcare facility planning

Growth, consolidation, renovation, liquidation — the trajectories of medical groups and their care facilities run the gamut in a fragile economy.

A Jan. 31, 2023, MGMA Stat poll asked medical groups whether they plan to add or relocate a practice facility in the next two years. The majority (53%) said “yes,” while 36% responded “no” and 11% were unsure. The poll had 619 applicable responses.

These results offer a glimpse into how different groups have fared in the recovery from the financial burdens of the COVID-19 pandemic and the struggle to maintain productivity and revenue in the face of staffing shortages.

As one practice leader who did not have expansion plans put it: “So few providers, more space is the last thing we need. The building my practice owns in plenty enough space; however, due in part to rising costs and decreasing revenue, we are not even able to stay current with building upkeep.” Several other practice leaders noted that access to capital and higher lending rates have kept them sidelined from making big moves.

Another respondent said that consolidating two offices into a single larger space was one way they approached handling growth without larger capital outlays for new construction. In fact, several of the poll respondents with no plans for the two years noted that they finished clinic expansions and relocations in recent years.

For those who remain on the fence on what the next few years hold, practice leaders noted they were waiting to see the long-term impacts of telehealth expansion and new remote/hybrid roles before settling on major facility changes. “If we continue to grow the group as planned,” one respondent told MGMA, “we will need to move all back functions offsite to allow for new providers space.”

Assessing facility needs with MGMA data

Using population data in combination with MGMA's data on square footage and number of exam rooms per physician can provide valuable insights for medical practices when making decisions about expanding their space or number of locations or moving to a new location. The MGMA data can provide a benchmark for the average amount of space and exam rooms needed per physician, based on industry standards and best practices. This information can then be compared to the population data to determine whether there is a high demand for healthcare services in the area and whether there is a need for more space or exam rooms to accommodate the patient volume.

MGMA Population Growth Analysis Tool

MGMA members enjoy exclusive access to a new Population Growth Analysis Tool, loaded with U.S. Census data that allows users to select cities and towns to see population trends from 2010 to 2020 and breakdown annual growth percentages compared to counties and states.

Decision-making via population data

Population data is a critical aspect for medical practices when considering adding clinicians, adding locations or moving to a larger location. This data can provide valuable insights into the demographics, health needs and healthcare utilization patterns of a specific area, allowing practices to make informed decisions about where to focus their resources and efforts. One of the main reasons why population data is so important for medical practices is that it can help identify areas of unmet healthcare need. For example, if a practice is considering adding a new location, population data can help determine whether there is a high demand for certain types of medical services in the area, such as primary care or specialist care.

Population data can also be used to identify areas where there may be a shortage of healthcare providers. For example, if a practice is considering adding a new location in a rural area, population data can reveal that there is a high demand for healthcare services in the area, but a shortage of providers. This information can then be used to help the practice determine whether adding a new location in this area would be a viable option, and whether there is a need for more providers in the area.

Another important aspect of population data is that it can help practices identify areas where there may be high utilization of healthcare services. For example, if a practice is considering moving to a larger location, population data can reveal that there is a high demand for healthcare services in the area, and that there are a high number of patients utilizing the practice. This information can then be used to help the practice determine whether moving to a larger location would be a viable option, and whether there is a need for more space to accommodate the high patient volume.

Overall, population data is a critical tool for medical practices when considering adding clinicians, adding locations or moving to a larger location. It provides valuable insights into the demographics, health needs and healthcare utilization patterns of a specific area, allowing practices to make informed decisions about where to focus their resources and efforts.

Do you have any best practices or success stories to share on this topic? Please let us know by emailing us at connection@mgma.com.  
 

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