Cover--The Environment
Hospitals used to worry that environmentally friendly practices were complicated and cost prohibitive. Not any more.
Traditionally, not much about hospitals has been considered “green,” unless you count the Jell-O. With incinerators belching noxious fumes from their smokestacks, HVAC plants humming 24/7, loads of harmful substances on-site, and mass quantities of plastics and disposable materials, hospitals have never practiced aggressive environmental stewardship. Many observers would even cite hospitals as a key source of harm.
Hospitals’ practices have changed drastically over the last few years, pushed largely by economic concerns. Rising energy costs and the need to replace older facilities are two obvious catalysts for change. “A lot of health care facilities were in very old buildings that rested on older energy systems, and we simply didn’t know as much then as we do now,” says Janet Brown, director of sustainable operations at Practice Greenhealth, an Arlington, Va., advocacy and educational group. “As facilities are going through a building boom, they have an opportunity to look at energy systems as well as other ways to become more efficient.”
Green practices in health care have since expanded beyond the more obvious, efficiency-type concerns and into other areas—things like recycling, reducing toxic materials, improving group transit, and purchasing locally grown food. These efforts have also evolved away from a piecemeal, siloed approach that involved only facilities managers, materials managers or building designers. Increasingly, the executive suite is becoming vocal and active in hospitals’ environmental efforts.
“Health executives in particular are beginning to recognize, ‘This isn’t just an add-on, this is a key part of our responsibility,’” says Adele Houghton, project manager of The Green Guide for Health Care, a best-practices toolkit that’s co-produced by Practice Greenhealth and the Center for Maximum Potential Building Systems. “A large majority of hospitals are beginning to look at this work in some way or another—energy efficiency, mercury reduction, water conservation, adding additional mass transit. It’s become pretty mainstream at this point.”
Executive Environmentalism
Executives’ reasons for going mainstream with green practices range from practical cost savings to public perception to a moral sense that “this is the right thing to do.” Leading hospitals have embarked on that journey in different ways. H&HN spoke to top executives at several hospitals that have been recognized as environmental leaders by The Green Guide (a consumer Web site distinct from The Green Guide for Health Care), the U.S. Green Building Council and the Environmental Protection Agency, to gain some insights into their environmental stewardship journey.
In Kalamazoo, Mich., Bronson Methodist Hospital started to “go green” more than a decade ago when it closed down its incinerator. “There was a day when it was typical for a hospital to burn all its waste, including regular waste and recyclables,” says Mike Way, Bronson Methodist’s vice president of materials management and facility services. “Our incinerator was in compliance; we weren’t doing anything that was considered wrong at the time, but we didn’t think all that burning was the most responsible thing to do.”
The closure forced Bronson to focus on separation and recycling. That experience launched Bronson toward a holistic approach that involves energy conservation, water conservation and increased recycling. Most significantly, Bronson used environmentally sound principles in the construction of its new hospital, which opened in 2000, and in its just-opened radiology center, the first building in Kalamazoo to earn the U.S. Green Building Council’s Leadership in Energy and Environmental Design certification.
“We selected a site that was adjacent to our existing site, instead of a greenfield, which reflected our environmental philosophy,” says Frank Sardone, Bronson Methodist’s president and CEO. “And when we tore the old buildings down, we recycled almost 80 percent of the materials, so we avoided having materials go into landfills and contaminate the environment.”
LEED certification has become a motivating goal for many health care organizations. But when Providence Newberg (Ore.) Medical Center first discussed LEED standards as a goal for its new hospital building, leaders decided that the basic certification wasn’t enough—they wanted nothing less than Gold LEED certification, the Green Building Council’s top recognition.
And in 2006, Providence Newberg’s new hospital became the first in the nation to earn that designation. The $70.6 million building uses only “green” electricity from a combination of wind, geothermal and hydroelectric power; circulates fresh outdoor air into the building; and uses large amounts of natural light and “smart” lighting sensors to adjust for occupancy and time of day.
“Well before we put pen to paper on the drawings for the hospital replacement project, we held an eco-charette with energy experts, Providence leadership and all the other key stakeholders,” says Larry Bowe, Providence Newberg’s chief executive. “Once the decision to go green was made, we were committed to doing so and all of our plans reflected it. The fact that employees work in a building with 100 percent outside air and lots of natural light is great for everyone—from environmental services to nurses on the floor.”
Going green in ground-up building projects might work better in small-town Oregon than in a sprawling metropolis, but many urban hospitals also are among the leaders in environmental stewardship. In Manhattan, NewYork–Presbyterian Hospital has garnered awards from the EPA’s Energy Star program four years in a row. The hospital reaps nearly $2 million in annual savings through sound energy practices and is trying to spread some of that culture of efficiency to employees’ outside lives, giving away hundreds of energy-efficient lightbulbs for employees to use in their own homes.
“We brought in some people who were devoted to the appropriate use of energy, and they focused on ways we could reduce consumption,” says Herbert Pardes, M.D., NewYork–Presbyterian’s president and CEO. Although NewYork–Presbyterian has a significant energy project coming online later this year in the form of a cogeneration plant, the major gains so far resulted from basic steps like proper maintenance and improved heating controls. “You don’t have to do very complex things; it’s a question of careful energy policies,” Pardes says.
Out west, Kaiser Permanente is adopting green building policies in 20 hospitals now under construction, installing low-toxicity flooring and roofing materials. It is also increasing recycling rates and purchasing locally grown food for hospitals throughout the system.
“We’ve really looked at how we, in very responsible ways, do things that are common-sense that will have a profound impact on our organization, including investing in the most energy-efficient ways of building,” says Bernard Tyson, Kaiser’s executive vice president for health plan and hospital operations. “The whole framework of efficiency starts at the C-suite and becomes ingrained in who we are. It makes economic sense, it makes environmental sense, and it gives us multiple opportunities to become a more responsible and efficient organization.”
Saving Money, the Earth
“Efficiency” is a mantra for hospital executives and environmental experts alike when discussing the advantages of environmental practices. It marks a 180-degree shift from the previous conventional wisdom about environmentalism.
“The long-standing perception was that doing the right thing for the environment will cost lots of money, and hospitals didn’t think they could afford to step up environmentally,” says Brown of Practice Greenhealth. “Our role is to share success stories of folks who have improved environmentally and saved money, to help hospitals see that commitment to the environment is win-win.”
Savings through environmentalism may have seemed elusive in past years when energy was relatively cheap. Rising energy costs have forced the issue to move up on hospitals’ agendas—but with potential savings rates around 30 percent of total energy costs, efficiency probably should have been there in the first place.
“Hospitals spend $8.3 billion on energy each year,” says Clark Reed, national health care manager for the EPA’s Energy Star program. “Health care buildings offer large opportunities for saving energy and fighting global warming … for hospitals, we’re looking at around $2.5 billion in potential savings.”
Reed notes that most of these potential savings can typically be achieved through simple practices, like proper maintenance and improved occupancy monitoring, rather than capital-intensive investments in plant and equipment.
“One of the surprises that we have begun to learn in this program is that you can make incredible savings just by tuning up existing equipment to operate as it is intended to,” Reed says. “If CEOs want energy efficiency, one of the best ways to do that initially is to make sure their facilities and operations are fully staffed and able to do the work to bring in the savings.”
Potential efficiency gains go far beyond energy savings and into less-obvious areas. “When we shut down our incinerator, that resulted in a cost avoidance of about a half-million dollars a year,” says Bronson Methodist’s Way. “We did incur some other costs through separating waste, but overall we saw a good return.”
Even traditional money-losers, like recycling and materials selection, can reap efficiency gains if done properly. “While we spend a lot on recycling, if you look at net gains after reselling, we’re probably netting a breakeven if not a positive,” says Tyson of Kaiser Permanente. “Some of the things we put in place may start out costing us more money, like the rubber flooring—but the cleaning and sterilization of the flooring after it’s in is much cheaper, and it doesn’t require toxic strippers. In many of our environmentally sound practices, ongoing cost savings more than compensate us for higher per-unit costs.”
‘The More the Merrier’
Beyond direct cost savings, experts say environmental stewardship can give hospitals a competitive advantage, making them the employer and provider of choice in an increasingly environmentally conscious society.
“Patients and communities are better educated about environmental issues and the connection between industry and health, and they’re making choices based on that knowledge,” says Practice Greenhealth’s Brown. “Leading hospitals are now recognizing the value in marketing themselves as a greener alternative.”
Current environmental leaders acknowledge some anecdotal evidence of competitive advantage, but they don’t give too much priority to that angle. “That’s probably people trying to ‘sell’ green more than anything else,” says Way. “There could be some validity to that viewpoint, but I like our approach—that it’s not about being competitive, but about doing the right thing for our community.”
Whether or not environmental leadership provides a true advantage, “green” hospital leaders are glad that these issues are gaining in both health care’s and the public’s consciousness.
“It’s wonderful to see that people are much more sensitive to the issues of our environment, the issues of how we can use our resources in the most efficient and effective way and leave this earth a little better off as a result,” says Kaiser Permanente’s Tyson. “If a fundamental ‘do-gooder’ mind-set gives us a competitive value, we’ll take it—but that’s not why we have the mind-set in the first place.”
A direct link between environmentalism and top-line growth may never be solidly proven, but some studies show a clear correlation. “According to the latest research, organizations that improve energy outperform competitors by 10 percent on net operating income,” says Reed of the EPA. “Energy efficiency really is important not just for cost savings but for strategy. It really is a good way to not only save money and become more competitive on the bottom line, but also to become a much stronger community leader.”
The irony of an environmental competitive advantage is that, based on their mission, health care organizations actually hope the advantage erodes, as more and more hospitals get on the green practices bandwagon.
“One of the things behind being a Baldrige organization is a commitment to teach others,” says Way of Bronson Methodist, which won the Malcolm Baldrige National Quality Award in 2005. “For a long time we’ve said this isn’t just about Bronson, it’s the right thing to do, and the more the merrier. We want everyone practicing environmental leadership and green practices until there are no more ‘leaders,’ it’s just the accepted way of doing things.”
Five Simple Steps
So, what can health care organizations that may be behind the curve do to get up to that Baldrige-type standard? The experts line up a few basic ideas. (For a more detailed exploration of specific steps, see the foldout section in this issue.)
1. Perform an energy audit
As the benchmarking mantra goes, you can’t manage what you can’t measure. “The first thing that hospitals must do is to compare themselves to their peers,” says the EPA’s Reed. He notes that the EPA has a tool that helps facilities benchmark their current energy performance on a scale of 1 to 100; the top Energy Star rating is reserved for hospitals scoring over 75, while those below 50 have significant room for improvement. “Once you know where you are, the better you’re able to determine what broad steps to take next,” Reed says.
2. Find low-effort, high-impact areas
LEED Gold certification might seem light-years away for many institutions, but some simple initial steps can reap large gains and help build momentum. “We try to suggest opportunities where hospitals can save money first,” says Brown of Practice Greenhealth. She cites the EPA’s Energy Star program, recycling efforts and the elimination of mercury as three basic programs that hospitals can use to launch their green efforts. “There’s plenty of low-hanging fruit, there are any number of things a hospital might want to do first, but there’s no required order.”
3. Go back to your mission
Hospitals can more easily and effectively motivate employees by reemphasizing core values of community health and stewardship. “The health care facilities that have really begun to take this topic seriously see it as directly connected to their mission,” says Houghton of The Green Guide for Health Care. “They’re saying, ‘Environmental stewardship is very integrated and fundamental to what we do, so we need to make sure that it’s always part of our process of health care delivery.’ ”
4. Identify and leverage your environmental mavens
When you begin preaching the message of environmental responsibility, in all likelihood you’ll be “preaching to the choir.”
“Initially, we thought it was going to be pretty challenging to educate all our staff, but we were flabbergasted and extremely pleased with the reaction,” says Way. “About 30 percent of our organization said, ‘I’ve always wanted to do things this way!’ and that served as a catalyst for the whole organization.”
5. Communicate the message as often as possible from top leadership
Any culture change requires lots of reinforcement—more so when it’s a drastic change, such as the shift from wasteful practices to green ones. “You have to repeat the message at new employee orientation, you have to talk about it at departmental meetings, employees have to hear that message from senior staff on a consistent basis,” says Practice Greenhealth’s Brown. “Organizations where the leaders consistently repeat that message have more success than those that don’t have the support at the senior level.”
That crucial senior-level commitment may be the lowest-cost, highest-impact opportunity of all. While the hospital industry still has huge areas for improvement in environmental practices, the growing trend toward senior-level commitment serves as a dramatic signal of a changing context.
“People are no longer asking, ‘Why should we do this?’ but rather ‘How can we do this?’ ” Brown says. “The fact that these issues are coming out of the basement and subbasement and into the boardroom is a positive sign. Leadership is getting more familiar with the issues and understanding the value from a leaders’ perspective.”—Chris Serb is a writer in Chicago.
This article first appeared in the August 2008 issue of H&HN magazine.
Major Challenges
Seeing Results
Three Hospitals Go for the Green
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