asset management in the nhs

DISCUSSION DOCUMENT S T R A T E G I CHEALTHCAREP L A N N I N G

Estate Asset Management in the NHS Lessons learned in the UK Date January 2014

asset management paper 2.docx Health service facilities in Portugal Version Number 1

Content 1.0 Introduction ...................................................................................... 3 2.0 Background ...................................................................................... 4 2.1 Assessment methodology ................................................................................... 4

3.0 The Estate Asset Management Process .......................................... 6 3.1.1 Where are we now? ................................................................................................................... 6 3.1.2 Where do we want to be? .......................................................................................................... 6 3.1.3 How do we get there? ................................................................................................................ 7 4.0 SHP has 20 years experience in the management of healthcare estate. ...................................................................................................... 8 4.1 Data Review ....................................................................................................... 9 4.2 Physical Survey .................................................................................................. 9 4.3 Developing a database ..................................................................................... 10 5.0 Recommendation ........................................................................... 11


1.0 Introduction Management of assets should form part of an integral process of an organisations strategic

service planning determined by the interaction of service need, asset availability and

performance, available finance, and availability of skilled healthcare professionals.

The stock of physical assets represents a valuable resource equally as important as the resources

of finance and manpower. This is indicated in the UK by the growing recognition that there is a

need for more effective and cohesive management of assets which was reinforced by the British

Standards Institute PAS 55 – a publicly available specification for optimal management of

physical assets which has been adopted and applied in most industries, in public and private

sectors and different regulatory regimes, cultures and environments, and is becoming a world-

wide specification for whole life cycle management of physical assets.

The NHS has historically segregated asset management within separate departments and

organisations with the key leads being the estates and facilities functions and a focus therefore on

buildings and utilities. This in turn led to prioritisation of work predominantly according to

condition rather than lowest whole life cost solutions for delivering improved and sustainable

models of care. NHS organisations are recognising this short fall and adopting the principles of

asset management in how they plan and allocate capital to deliver strategic service objectives.

They recognise the competing demands for maintenance and improvement of:

• Estate – facilities and utilities

• Medical Equipment

• Information technology

And the inter-relationship between each in developing long term solutions that optimise

flexibility and efficiency.

The Estate element represents the most significant asset in terms of both size and value and

experience has shown that creative manipulation of the estate in the context of service planning,

can substantially reduce the revenue burden, but only if the nature of the estate and its future

potential are properly understood.

SHP has provided support to many NHS organisations in identifying and auditing this element,

it’s potential to support strategic service objectives and detailed programmes of work to effect

appropriate change and development.

This paper seeks to identify processes and lessons learnt from supporting the NHS in improving

its estate asset that may be of value to health services in Portugal.


2.0 Background The NHS estate covers 6.9 million hectares and is

valued at almost £40bn (2011-12). This makes it

the single largest property holder in the public

sector and potentially able to cover the City of

London ten times over. For this reason if no

other, it has a major role in delivering

Government initiatives and legislation. The

annual running cost of the NHS estate is £7

billion annually and with current Government

austerity measures and a need to save £20 billion

across the service without reducing safety or

quality; the estate and facilities assets are significant in achieving this.

The NHS Constitution contains two pledges that relate to the premises in which healthcare is

delivered:

a) Services are provided in a clean and safe environment that is fit for purpose, based on

national best practice; and

b) Continuous improvement in the quality of services that users receive, identifying and

sharing best practice in quality of care and treatment.

The NHS estate is therefore an important enabler of high quality health services as well as a

potential source of risk to patients, staff and visitors in terms of safety. The Boards of NHS

organisations are responsible for ensuring these commitments and an assessment system has

been developed to provide a consistent national basis that can be made available to other

stakeholders such as commissioners, regulators and the public.

2.1 Assessment methodology The systems used in the NHS provide individual organisations with a way of assessing their

estate and have the advantage of providing a diagnosis that is based on comparing chosen

dimensions of an organisation’s use of the estate with those of other relevant NHS organisations.

It is a tool that allows greater insight into the efficiency, effectiveness and safety with which they

manage their estate and includes some patient experience measures. At a high level it is based on

two types of analysis.

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§ Qualitative, self-assessment of effectiveness, safety and patient experience – Self Assessment Questions (SAQs);

§ Quantitative, non-parametric benchmarking (using Data Envelopment Analysis, DEA) of the efficiency of estate use - Metrics

The methodology covers both estates (the physical fabric of buildings) and facilities (the services

that are directly linked to the estate i.e. energy, water, cleaning etc.).

The SAQs give an overview of the systems, procedures and on- going actions that organisations

should be undertaking. The Metrics show the results of those actions, in terms of benchmarked

metrics that allow comparisons against peers. By comparing the SAQs (inputs) to Metrics

(outputs), an NHS organisation can determine where they are doing well and where action is

needed to make improvements. Action plans can then be developed and implemented if required.

The assessed profile provides a guide to the character and complexity of the healthcare estate and

facilities, and can be used as a prompt for further enquiry and to stimulate better-informed

dialogue as to how the premises can be more efficiently used, more effectively managed, and

make a contribution to the overall strategic objectives of the healthcare provided.

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3.0 The Estate Asset Management Process

This process aims to provide a vision for the estate that can be flexible enough to respond to

future service requirements, supports maintenance and improvement to existing services,

increases efficiency and effectiveness and improves patient care – an Estate Strategy.

It asks three basic questions in relation to an organisations estate:

§ Where are we now?

§ Where do we want to be?

§ How do we get there?

3.1 Where are we now? This element is aimed at developing a comprehensive analysis of the current condition and

performance of the estate using six facets. It develops a baseline against which the development

of strategy can be measured.

The six facets are:

§ Facet 1: Physical Condition – identifies all elements of the estate depending on operational safety and deterioration – also called backlog maintenance

§ Facet 2: Statutory Compliance – assessment of compliance of facilities with standards and guidance

§ Facet 3: Environmental Management - assessment of the organisations ‘sustainability’ performance including energy (including carbon footprint), water, transport, waste, procurement

§ Facet 4: Space Utilisation – identifies how much and how often rooms are used

§ Facet 5: Functional Suitability – assesses the internal space relationships, support facilities and location/adjacency of clinical areas

§ Facet 6: Quality – identifies the levels of patient amenity and comfort offered in each area including aspects of aesthetic design

3.2 Where do we want to be? This stage considers the long-term aims of the organisation, requirements of national and local

service strategies/policies and short-term service issues. It aims to develop an understanding of

what service changes are required and the impact these would have on the estate. It also aims to


set targets for improving the condition and performance of the estate and for ensuring that the

estate more closely matches the service need for the foreseeable future.

3.3 How do we get there? This final stage of the process involves developing options to enable the organisation to achieve

its objectives that identifies and prioritises the capital investment that will be needed to deliver

the required changes and modernisation of services including:

§ the estate that is to be retained; the degree of modification (extension, change of use, reduction) envisaged;

§ the need for additional land and property and the functional units to be provided and the availability for disposal of unwanted existing land and property;

§ the potential for re-use of assets (equipment, plant) currently used in unwanted facilities;

§ the timing for delivery of retained, refurbished, re-usable, extended or newly-created land, property and other assets and the availability for disposal of unwanted assets;

§ the resources to sustain the resultant estate.

This can also include

production of a ‘development

control plan’ to control ad hoc

expansion of the estate over

time and will input into the

organisations capital

investment/business case

process along side medical

equipment and information

technology developments.


4.0 SHP has 20 years experience in the management of healthcare estate.

The methodology and process described above has been used by SHP throughout the UK to help

health organisations ensure:

§ Land and property is used efficiently, effectively and strategically to support organisations plans;

§ Maintenance of appropriate quality healthcare facilities in the right location that support the provision of effective healthcare.

Since the introduction of this methodology in the NHS in 1984, SHP staff has undertaken

assessments of over 3,000,000 m2 of assets, the most recent of which covered the totality of the

healthcare estate of Leicestershire.

We have helped organisations to put innovation and productivity at the heart of healthcare

delivery by elucidating efficient care models with clinical staff and combining this with our

assessment of the estate to deliver effective change as depicted below:

The range of benefits to a healthcare provider and the wider health economy in having a formal

estate evaluation are:

§ an assurance that clinical services will be delivered from safe, appropriate environments

§ a means of ensuring that estate capital investments are linked to service strategies

§ a plan for change in which progress can be measured

§ a strategic context in which detailed business cases for all capital investment can be developed and evaluated

Delivering change

Efficiency driven models

of care

ExploiGng underused Estate

Estate evaluaGon


§ a means by which the healthcare procurement body can identify capital investment projects which will require formal approval and relate to wider community developments/plans

§ a clear strategy to ensure environmentally sustainable development

§ a process that ensures property assets are effectively managed, risks are controlled and investment properly targeted.

4.1 Data Review To support the estate evaluation, it is essential to have:

§ A clinical service strategy

§ Up-to-date drawings of the buildings, showing room layouts with room numbers.

§ Records of the buildings age and any past upgrading schemes.

§ Appropriate maintenance records for major plant to providing information on abnormal plant deterioration.

§ Statistical information on bed numbers, patient contacts, and sessions held etc.

§ Statistical information on energy, waste, water and transport performance

4.2 Physical Survey The process of collecting data for the appraisal of the current estate should be approached

pragmatically based upon informed and experienced observation. It will constitute a snapshot in

time and, therefore, needs to be completed within a tight timescale.

Surveying should be carried out by more than one person, as this will allow assessments to be

compared and discussed, and will lessen the subjectivity of the exercise. In order to ensure

consistency it is advisable, wherever possible, for the same people to conduct appraisals across all

the sites involved. For example, a single panel of people could undertake assessments of

functional suitability, space utilisation and quality at a single visit comprising: an

estates/facilities manager or architect with a general/clinical departmental manager to survey

these three facets in order to give a multi-disciplinary viewpoint. However, it should be noted

that a team of more than three will be cumbersome and may not be welcomed by departments.


A standard form for each facet should be used to ensure that data is collected across each

building and department in the same way. It is useful to have a “notes sheet” for each building on

which more specific issues can be recorded, to be followed up later.

Ultimately the aim should be to collect the data electronically, using a hand-held terminal to

input data as the surveying takes place. This can be downloaded later into the database and can

populate drawings in a CAD system.

4.3 Developing a database It is particularly important that the results from the appraisal are presented in a clear and concise

way. This can be achieved by using a computerised database, which allows large amounts of data

to be stored and easily handled. The system used should have outputs in the form of statistical

diagrams, scale drawings, spreadsheets, reports or a combination of these. It should be capable of

extensive interrogation and the more flexible it is the better.

The database should be capable of presenting different levels of aggregation of data, for example:

§ by floor level;

§ by organisations whole estate;

§ by site;

§ by individual building;

§ by department;

§ by building age/value.

It can be useful to be able to present data on a care group or clinical department basis, but this

may be difficult where several functions share a site or building.

A presentation of the cost implications of the appraisal is very important – in other words, what

will it cost to bring the estate up to an acceptable condition?

It is often useful to be able to look back in order to establish whether the situation has got worse

over the past decade. It can also be useful to look forward and estimate the requirement for

expenditure on assets to keep them in an acceptable condition over the next 5–10 years.

Examples of data outputs are given in ‘Developing an estate strategy’. This can be used to inform

the capital investment programme for the organisation.

One of the best ways of sharing data is to apply it to site and floor plans through the graphical

interface capability of a CAD package. Most CAD packages are complex and require a powerful

computer with specialised equipment to make them effective for the user. There are specialised


software packages on the market that provide integration between data files and plans/maps;

most require significant investment to set up and specialised operation to keep the record

updated. Specialised software packages also require specialised training and dedicated staff

resources to keep them updated.

Consideration should also be given to the use of aerial/localised photographs to illustrate

particular areas of concern.

In presenting the results you should attempt to provide both a cost and a risk assessment from

your data. You need to indicate within each facet where the most serious risks lie and what

investment needs to be made to put them right. It will not necessarily be the case that buildings

in a seriously poor condition, where action must be taken to minimise risk, are those where the

cost is highest.

5.0 Recommendation This document has been prepared to introduce the importance of effective estate asset

management to those organisations that currently have no processes in place.

Such organisations are invited to consider the potential benefits that can be derived in the use of

the proposed methodology and to determine the extent to which Strategic Healthcare Planning is

able to assist

The following link will provide an indication of those projects that

have been undertaken by SHP and of the depth of experience the

company has.

http://issuu.com/j.clarke/docs/es_v2.3_pages

For those interested parties who reside in Portugal and who require

further information, an initial approach should be made to;

Pedro Lenz Marcos (351) 917 221 866

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John B Clarke Strategic Healthcare Planning LLP January 2014

asset management in the nhs

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