From left to right: Jonathan Flannery, Mark Mochel and Matthew Stiene present a conference session on deferred maintenance at the 2021 ASHE Annual Conference.
Image courtesy of ASHE
As health care infrastructure continues to age and patient needs become increasingly complex, deferred maintenance in hospitals and health facilities is an issue that is top of mind not only for health facilities managers, but those in the hospital C-suite as well.
In fact, the American Hospital Association will address this topic at its Rural Health Care Leadership Conference Feb. 6-9 in Phoenix. The Tuesday sunrise session, “A Discussion on the Principles of Infrastructure Capital Planning,” will discuss how to develop an infrastructure renewal capital plan and give a better understanding of the impact of deferred maintenance on the physical environment.
The American College of Healthcare Executives also will cover the subject at its 2022 Congress on Healthcare Leadership March 28-31 in Chicago in the session, “Infrastructure Renewal: A Discussion on the True Cost of Infrastructure Deferred Maintenance.”
Jonathan Flannery, FACHE, FASHE; Mark Mochel, PMP, CSM, FCT, ACABE; and Matthew Stiene, PE, CFM, CHFM, will be leading the sessions at both conferences, which follow up on a similar presentation the three delivered at the ASHE Annual Conference last year.
Recently, Stiene spoke with HFM to give a facilities manager’s perspective on deferred maintenance. He began his time with Novant Health, Charlotte, N.C., 10 years ago as senior director of engineering and was named senior vice president of construction and facility services last year.
Facilities managers typically categorize infrastructure needs into seven buckets. Can you tell us what those are?
First there is compliance, which is anything required to ensure the facility is meeting all regulatory requirements. These requirements can range from the Centers for Medicare and Medicaid Services, The Joint Commission or a local building official. Some examples of compliance items would be fire alarm testing and sprinkler system testing to ensure they’re functioning properly.
Next is general operations, which is about ensuring simple building functions work properly. This includes items such as changing light bulbs, and ensuring faucets work and water runs.
Break/fix is less capital intense and aligns with the operational needs. For instance, a valve on an air handling unit fails and needs to be replaced as a component of a larger system.
Asset failure is when an asset has reached a point where it cannot be repaired, or it can’t be repaired in a manner that will regain its full function. This would include things like a chiller, medical air compressor or nurse call system.
After that is planned replacement. This is when deferred maintenance is used to understand what equipment needs to be replaced and and when.
The sixth is preventive maintenance. This is maintenance performed on equipment to prevent it from degrading in performance and to keep and maintain performance functioning as intended.
The last is deferred maintenance. There are many ways to look at deferred maintenance, but generally, these are items that have exceeded their useful life and need to be replaced sometime in the future. Deferred maintenance is a financial measure that shows the limited investment in the facility. If a facility is operating effectively with a high amount of deferred maintenance, then that means they are doing a pretty good job of maintaining equipment and keeping it running. At that point, the deferred maintenance is simply a lack of investment on behalf of the organization into the facility.
What are the first steps in developing a strategy to manage assets within the deferred maintenance category?
I think you need to know what assets you have and how long you expect them to last, as well as what is the appropriate amount of maintenance for that asset so that you can explain how you’re maintaining your equipment.
The other tool is the ability to understand how to prioritize needs and how to prioritize deferred maintenance, because the likelihood you’re going to get all the budget you need at once is not high. A really good prioritization tool is needed to understand which projects need the biggest push to ensure facilities are spending their money in the right place.
How does this strategy play out at Novant Health?
For us prioritization is really around a couple of key components. We’re looking at the age of a piece of equipment, and we’re looking at risk. What does that piece of equipment do? What happens if it fails? And what area does it serve?
So, if I take an air handler, for example, that serves a patient care area, it is going to be a higher priority than an air handler that serves an administrative area. Likewise, a generator that serves a patient care area is going to be higher priority than a generator that serves a medical office building that has the ability to suspend services if there’s a power failure.
First, we use age and risk, and now we’re beginning to look at energy as well. If we have two like chillers that both meet the same age and risk criteria, the tie breaker would be energy. We ask how much energy can we save by replacing one unit versus the other.
What advice would you give to facilities managers who are struggling to keep up with their deferred maintenance needs?
Actively promote the need for investment in infrastructure and actively attempt to gain funding to address it. Make sure you’re educating people on your systems. Sometimes other leaders don’t understand the complexity or the components that go into these systems and how they all must work together for something to function properly.
It’s important to have candid conversations with leadership about what their expectations are. I think as facilities leaders we also need to have the understanding that we can’t get everything we want, but it’s still important that we do everything we can and are reasonable about our own expectations.
There is not a single plan that’s going to work at each facility. Work with leadership to explain to them the risk and reward of allocating dollars to certain parts of the operation and make sure to work hand-in-hand with them to find the best way to do that.
Here at Novant, we have facilities that range from the 1930s to facilities that opened in 2018. We also have facilities from the coast of North Carolina to the Winston-Salem area to Charlotte. So, we have urban, suburban and rural facilities, each with their own revenue sources and providing different services. We have a set baseline for expectations of the services we’re going to provide at every facility, but after that it’s about understanding what’s important to each of those facilities leaders and tailoring a plan. It takes a lot of coordination and collaboration, and also education of leadership.