Author: Shane Dunne

  • The Roadmap to Profitable Healthcare Sustainability Management

    The Roadmap to Profitable Healthcare Sustainability Management

    The healthcare industry faces a daunting challenge and an unprecedented opportunity: balancing its critical mission of delivering the best patient care with thin margins and an expanding environmental footprint. Traditional healthcare facilities are notorious for their high energy and water consumption, significant waste generation, equipment and supply needs, and production of greenhouse gas emissions. Hospitals rank behind only food service and food sales facilities as the most energy-intensive commercial operations in the country.

    However, a major paradigm shift is underway. Healthcare sustainability is no longer a “feel-good” initiative; it’s a strategic imperative and smart financial investment for forward-thinking health systems.

    Benefits of Sustainability in Healthcare

    Although the scientific data behind how decarbonization and sustainable practices are essential to protect health and planetary systems is becoming more irrefutable, the practical and economic benefits are driving operational changes among health system executives. Many people are unaware of the practical, tangible benefits of sustainability in healthcare that leading peers are realizing, which include:

    Significant Cost Savings

    Optimizing energy and water usage, building operations, waste management and reduction, and sustainable procurement practices translates to substantial financial savings. Upgrading to energy-efficient technologies, reducing water consumption, and implementing waste reduction programs can provide immediate cost savings and compound into significant reductions in operational costs over time. Boston Medical Center Health System — an organization pioneering best practices in healthcare sustainability management — is projecting to save more than $500 million by 2030, with $150 million of that attributed to energy related savings, through employing industry-leading practices and strategic interventions.

    Boston Medical Center’s Energy Costs and Square Footage, 2011–2030

    Boston Medical Center’s Energy Costs and Square Footage, 2011–2030
    Data: Presentation by Robert Biggio of Boston Medical Center at the Sustainability in Healthcare Hackathon, Massachusetts Institute of Technology, Apr. 21, 2023.
    Source: Martha Hostetter and Sarah Klein, Greening the Health Care Safety Net: How Boston Medical Center Reduced Its Carbon Footprint Without Compromising Patient Care (Commonwealth Fund, Aug. 2023). https://doi.org/10.26099/0na0-8v90

    Environmental Stewardship

    The U.S. healthcare sector accounts for roughly 8.5% of the nation’s greenhouse gas emissions. By embracing sustainability practices that complement hospital operations, healthcare systems can minimize their carbon footprint, conserve natural resources, create more resilient supply chains, reduce staff and patient exposure to hazardous chemicals, and create more equitable access to health services across communities. This aligns well with growing public concern about climate change and its impacts on human health, positioning them as responsible corporate citizens.

    Increased Asset Value

    Sustainable building design and construction using energy-efficient systems, smart building controls, materials with lower embedded carbon, and features with lower environmental impact are increasingly attractive to patients, staff, and investors. This leads to improved property values and potentially increased revenue streams through building certifications (such as LEED or WELL) or attracting sustainability-focused partners. They also create ideal conditions for state-of-the-art healing environments.

    Freeing Up Funds for Enhanced Patient Care

    The cost savings achieved through healthcare sustainability management initiatives can be reinvested in areas that directly improve patient care and support health systems’ missions. This could include acquiring advanced medical equipment, expanding patient services, or recruiting, retaining, and training staff.

    By focusing on less resource-intensive operational practices and energy consumption, healthcare systems can create a virtuous cycle: They can save money, improve the environment, protect human health, and improve their margins to invest in patient care delivery.

    Strategies for Complete Healthcare Sustainability Management

    Transforming a healthcare system into a sustainability leader requires a multi-pronged, strategic, long-term approach involving the following key steps:

    Reducing Energy Usage

    Lower energy consumption is the starting point for healthcare sustainability management. Hospitals may conduct a comprehensive energy audit to identify areas of high energy consumption by analyzing lighting systems, HVAC equipment, and capital equipment for opportunities to upgrade to more energy-efficient models and leveraging technology, like installing occupancy sensors in rooms to automatically adjust lighting, air exchanges, and temperature based on usage.

    Audits and Engineering Evaluations

    Another step is to engage qualified engineers and sustainability experts to perform detailed building audits. These professionals can analyze energy consumption patterns and recommend specific steps to optimize a building’s envelope, identify opportunities for natural lighting or ventilation, and assess the viability of integrating renewable energy sources into system portfolios.

    Retro-Commissioning

    This process involves reassessing and recalibrating existing building systems to ensure they operate at peak efficiency — in other words, a system tune-up. Retro-commissioning can significantly reduce energy consumption and improve system performance without requiring major infrastructure upgrades.

    Identifying Electrification Opportunities

    Engineering and facility leaders will also explore the feasibility of converting fuel-based equipment and building systems to electric alternatives. This can include replacing gas-powered boilers with electric heat pumps, transitioning to electric vehicle fleets for patient transport or facility maintenance, and using electric equipment and appliances. Electrification reduces reliance on fossil fuels and can result in increased energy efficiency, decreased carbon emissions, and lower operational costs across the life cycle — all critical steps toward decarbonization.

    Green Building Design and Sustainable Construction

    If new construction is unavoidable, it’s important to leverage proven green building principles to create resource-efficient structures that optimize energy and water efficiency, improve indoor air quality, use sustainable materials, and take advantage of natural light and ventilation to create healthier and more productive spaces for occupants while reducing operating costs.

    Water Conservation

    Energy use is only one facet of healthcare sustainability management. Health systems should also consider implementing monitoring and water-saving strategies, including low-flow fixtures, leak detection systems, and stormwater management, and educating staff on water conservation practices.

    Waste Management

    It’s also critical to minimize waste generation through careful purchasing, source reduction strategies, staff education on proper segregation, and implementing reprocessing, product take-backs, and recycling programs for appropriate waste streams. Prioritizing products with minimal packaging and encouraging responsible disposal can significantly reduce the environmental impact of your operations.

    Sustainable Procurement

    Supply chain and procurement leaders should integrate responsibly sourcing and sustainable procurement best practices into RFX processes. Efforts can include purchasing equipment with a lower total cost of ownership and energy-efficient design, buying supplies with high recycled content or bio-based materials, and working with vendors that use lower carbon manufacturing practices. These leaders should also look for products with third-party certifications, such as Energy Star, EPEAT, Ecologo, or GreenSeal certifications that meet environmental and social responsibility standards.

    What’s Your Plan? 

    Doing nothing or business as usual is not an option. As the effects of climate change become more apparent and increasing regulations require businesses — hospitals included — to take steps toward more environmentally responsible operations, it’s important to formulate strategies now. The sooner, the better.

    Keep two key considerations in mind: 

    • Done correctly, healthcare sustainability is an investment with significant, measurable ROI and long-term profitability.
    • You don’t have to do it alone. The right experts with the right experience can help you identify opportunities and guide you through the process.

    Embracing sustainability management in healthcare operations is much more than an environmental imperative; it’s a strategy that can significantly improve your financial performance, enhance your reputation, and position your health system for a more successful future. 

    Navigating the increasing complexities of healthcare sustainability can be challenging. To unlock your healthcare system’s full potential for sustainability, partner with an experienced sustainability solutions provider like Oakwell. Our experts can work with you to develop a customized plan, identify funding opportunities, and guide you through the implementation process, ensuring a smooth and successful transition toward short- and long-term wins and a more sustainable tomorrow.

    Contact us to learn more.

  • Climate Action: The ROI of Decarbonization in the Healthcare Industry

    Climate Action: The ROI of Decarbonization in the Healthcare Industry

    The world is changing. As we grapple with the escalating impacts of climate change, those of us in the healthcare sector stand at a crucial crossroads. We see evidence of increasing frequency and intensity of climate-related events — like heatwaves, wildfires, floods, and infectious disease outbreaks — and we know they pose significant threats to public health and vulnerable populations. Health systems are on the front lines and are the first responders to climate emergencies so they must continually adapt to these challenges, leverage innovations to mitigate their own emissions, and spearhead efforts toward building a more climate-resilient industry that can deliver effective, uninterrupted care.

    Climate resilience is the ability of a people, group, or ecosystem to bounce back after a hazardous climate event like a flood, drought, or emergencies caused by storms and related disease outbreaks. The healthcare industry plays an important role in stabilizing our ability to recover and make positive changes. 

    Climate mitigation is the action of limiting the emissions of greenhouse gases in the atmosphere to help avoid the worst impact of climate change. The healthcare industry accounts for 8.5% of U.S.-based greenhouse gases (GHGs). Concurrently, industry leaders are hearing increased calls to their responsibility to lead by example and cut emissions while building climate-resilient health systems. 

    With resource-intensive operations and rising accompanying costs, health systems need to look at decarbonization efforts to transition from energy- and resource-intensive consumption models to climate-smart interventions that reduce utility consumption, provide energy independence, integrate smart purchasing models, view life cycle costs, and reduce carbon footprints to cut costs that can be holistically reinvested into health systems. 

    By integrating sustainable practices and climate-smart strategies, healthcare institutions can mitigate the health repercussions of a changing climate, improve the strength of their organizations, safeguard our communities, and ensure a healthier future for all.

    The Impact of Climate Change on Our Health

    The CDC lists a variety of documented outcomes associated with our changing climate, including:

    • Increased heat-related hospital visits for respiratory issues
    • Rising number of heat-related cardiovascular and kidney disorders
    • Higher exposure to mold, food, and water-borne illnesses from flooding
    • Higher incidences of asthma due to increased air pollution 
    • Increased pollen and higher allergy rates related to longer growing seasons
    • Increased wildfire activity, resulting in more cases of asthma and COPD from poor air quality
    • Higher incidences of poor mental health following climate-related disasters

    Source: Centers for Disease Control and Prevention

    According to the World Health Organization (WHO), weather and climate hazards directly and indirectly impact people’s health. The Lancet Countdown provides hope that, even though climate change is a staggering threat, it also offers a great opportunity to redefine those things that have such a negative impact. The healthcare industry can — and should — lead efforts toward action and meet the growing calls to do its part in alleviating climate change.

    The Healthcare Industry and Greenhouse Gases

    First, we acknowledged that the healthcare industry accounts for 8.5% of U.S.-based GHGs, but the industry has become more, not less, polluting. Emissions increased 6% between 2010 and 2018. Healthcare facilities and operations are incredibly climate intensive, impacting the environment and public health significantly. These GHG emissions come from various sources within the health sector:

    Energy Consumption

    Hospitals, clinics, and laboratories are energy-intensive facilities that require substantial energy for ventilation systems, lighting, and running specialized medical equipment. Many healthcare facilities are located in geographies that rely on local fossil fuel-based energy sources, such as coal, natural gas, and oil, which emit high levels of GHGs.

    The increasing use of digital health records and the growth of data centers require robust IT infrastructure, which consumes large amounts of electricity.

    Medical Equipment and Devices 

    Most of the emissions for a health system are embedded in their indirect Scope 3 emissions from the production and transportation of goods and services procured. The production of important medical devices and equipment involves energy- and resource-intensive processes that emit greenhouse gases throughout the life cycle. Some medical equipment also uses climate-intensive gases, such as nitrous oxide or desflurane, as anesthetics and hydrofluorocarbons (HFCs) in refrigeration — which are potent greenhouse gases that persist in the atmosphere.

    Building Construction and Maintenance

    Building new sustainable healthcare facilities or renovating existing ones involves massive amounts of embedded carbon within material inputs and construction processes. The extraction, production, transportation, and installation of building materials and the operational and end-of-life phases of a healthcare facility also contribute substantially to emissions.

    Medical Waste 

    Medical waste is often incinerated to prevent contamination, and this incineration process releases carbon dioxide and other harmful gases. Organic waste that decomposes in landfills produces methane, a potent GHG. These facilities are also often located in disenfranchised areas, with local communities bearing the brunt of negative health impacts.

    Transportation 

    Hospital fleet vehicles, ambulances, helicopters, and other medical transport vehicles contribute significantly to GHGs. The production and transportation of medical supplies, food, and other necessary goods for healthcare facilities involve emissions at various stages, from manufacturing to delivery. Staff commuting and business travel also contribute to emissions and offer opportunities for reductions.

    Crucial Steps Toward Reduced Emissions

    There is much work to be done, and commitments are required on numerous fronts. In an effort to accelerate industry progress on decarbonization and health equity, the U.S. Department of Health and Human Services launched the Health Sector Climate Pledge in 2022, with voluntary commitments to do the following:

    1. Reduce organizational emissions 50% by 2030 and achieve net zero emissions by 2050.
    2. Designate an executive level lead to work on reducing emissions by 2023 and conduct an inventory of Scope 3 (supply chain/indirect emissions) by the end of 2024, or within 6 months of signing the pledge.
    3. Release a climate resilience plan for continuous operations by the end of 2023 or within six months of signing the pledge. 

    Additionally, within the past year both the Joint Commission and the Centers for Medicare and Medicaid Services (CMS) released voluntary climate reporting standards and certifications for hospitals and health systems. More broadly, the Securities and Exchange Commission and the state of California passed mandatory climate disclosure and reporting rules. These rapid increases in voluntary climate related commitments and mandatory disclosures is sending a strong signal that healthcare entities need to strategically prioritize decarbonization related efforts to meet growing stakeholder expectations. 

    Changing the Story: Climate Resilience and Mitigation for Better Health Outcomes

    The goal of healthcare institutions is to improve health, not damage it. So, we must change the story, executing proven climate mitigation interventions and reductions that can save millions in related costs, while creating climate resilience–ready infrastructure and facility systems that deliver positive health outcomes for patients. Effective strategies are already helping leading healthcare institutions reduce their negative climate impact and save substantial costs. The business case is undeniable. These strategies simultaneously help clinics, hospitals, and healthcare centers positively impact their bottom line through extensive savings and improve the health of the stakeholders they serve. 

    This ROI of climate action benefits both the hospital and the community by:

    • Improving energy efficiency, saving costs, and protecting against rising utility rates 
    • Adopting renewable energy sources and creating energy independence
    • Meeting increased stakeholder and regulatory demands
    • Preserving population and community health 
    • Enhancing supply chain efficiencies and resilience
    • Improving waste management practices
    • Encouraging sustainable transportation options

    The other lens can be seen as the emergent ROI of climate action or the “risk of inaction.” The major risk is an interruption in patient care and operations due to extreme weather, disruption of critical supply chains, rising health inequities, and revenue losses. The human risks are all too real and the business risks are rising by the day. 

    Oakwell offers robust and comprehensive help for healthcare institutions to assess where change needs to happen, create important goals, and then implement measures with roadmaps tailored to complement current operations in reducing the environmental impact of patient care delivery. We’ve seen vast reductions in calculated emissions of the institutions we work with and significant improvements to their companies’ bottom lines that only compound over time. 

    We are helping healthcare systems improve profitability by focusing on climate change sustainability and acting as stewards of their resources. We help our partner institutions discover extensive energy and utility cost savings, optimize real estate assets, create more efficient supply chain logistics, reduce waste generation, and reduce the overall climate impacts of their daily healthcare operations. 

    Leading the Way With Sustainable Healthcare

    As healthcare leaders, we hear the call to take responsibility for addressing the factors in operations that lead to poor health outcomes for the populations we serve and making the changes necessary for truly sustainable care delivery. The healthcare industry’s goal is to improve the health of the communities we serve, and Oakwell is here to improve the health of your system and those you serve. 

    Oakwell has realized the extensive positive impact on the bottom line of the sustainable healthcare systems we’ve partnered with. But just as important is the positive impact on the communities they serve, with reduced healthcare costs, improved public health, and increased preparedness for rising climate-related events. And taking proactive action toward climate resilience and mitigation is a win-win for everyone, with long-term ripple effects. We can help you strengthen your community engagement and brand recognition, further building trust with patients, staff, and your community.

    Our diverse team of experts in hospital operations, sustainability, engineering, technology, and finance has figured out how to improve the sustainability of your healthcare system and save you money doing it. We partner with you every step of the way toward decarbonization and resiliency. We will help you quantify and track your Scope 1, 2, and 3 climate impacts, create strategic goals, tailor master plans, and work collaboratively to implement the necessary changes via dedicated roadmaps and direct resources for the desired outcomes. We will stay with you after implementation to help you measure and verify those changes in real time and make necessary adjustments.

    Oakwell will create organizational functions that help you act as stewards of resources within your health system and improve your bottom line. Let’s work together to create a healthier future for your healthcare system and our planet.

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