Healthcare

Healthcare foodservice, which includes acute care, continuing care and senior dining in CCRCs, is another onsite segment that Technomic says will fare better in 2009 than much of the rest of the industry, growing between 0 and 3.5 percent in nominal terms.

In the broader picture, a decline in the absolute number of available hospital beds has flattened out, although the number of beds per 1,000 in the population continues to decline (Fig. 22). Hospitals are continuing to move to room service models at a rapid pace (Fig. 23), driven largely by efforts to improve patient satisfaction scores.

Select charts to enlarge.

Efforts to upgrade aging foodservice facilities and infrastructure, both to reduce maintenance and promote retail sales, continue.

A recent survey by the National Society for Healthcare Foodservice Management (HFM) shows that nearly 20 percent of its membership have renovated their kitchens in the past one to four years. The same survey shows that 27 percent have renovated their retail dining environment in the same period and that more than half expect a major renovation or construction project in the near future. Over half now say they have cashless payment systems in place, setting the state both for greater retail dining efficiencies and the potential for increases in check averages.

Another trend: as hospitals seek to improve the effectiveness of care delivery systems, many have re-focused on the role of nurses and sought to refocus the way their time is allocated.

For example, a 2008 study of three dozen U.S. medical and surgical units by Kaiser Permanente and Ascension Health showed nurses spent twice as much time away from patient bedsides as by them. Meanwhile, contract management giant Aramark has made it a major research initiative in the past year to identify opportunities to improve nurse/support service relationships at healthcare accounts where it is a major provider of food and other support services.

That is among the reasons many hospitals are re-evaluateing the common practice of having nurses deliver food trays. This often plays to initiatives like room service in which foodservice gains more control over the meal delivery process.

Increasingly, however, the credit crunch that has seriously constrained capital availability for many hospitals in the last six months is demanding all of administrators' attention. Their financial positions have also been complicated as the level of upaid patient debt has risen, another byproduct of the recession. And, just like K-12 schools, they often find that government reimbursement rates fall short of their actual costs.

Hospitals have also seen a major erosion in the value of their endowment funds and many have found themselves locked out of the tax-exempt bond market, another financing alternative. A just-released study by the American Hospital Association showed that nearly half the hospitals responding had put capital projects on hold and stopped those in process.

“The largest part of hospital foodservice these days is employee and visitor feeding, and operators there face many of the same issues as those in B&I,” says Technomic's Joe Pawlak.

“Onsite meals can still be seen as a good value, but operators will need to keep introducing new items to add excitement. They'll also have to be cautious about sacrificing quality for margin — the consumer will see that right away and have a negative reaction. In short, they will have to work hard at addressing the value perception. Beyond that, they just have to stay the course.”