April 1, 2024 Securing Fire Safety Funding in Healthcare Facilities

Ensuring fire safety in healthcare facilities is crucial. However, acquiring the necessary funding can present significant challenges.

By Mickey Eberts, CEO of REMEDI8®

Ensuring fire safety in healthcare facilities is crucial to safeguarding the well-being of patients and staff and maintaining regulatory compliance. However, acquiring the necessary funding can present significant challenges. Balancing competing maintenance priorities and justifying investments in fire safety against revenue-generating healthcare services can be a formidable task for facilities directors. In light of these obstacles, what strategies have proven successful in securing the necessary funding for fire safety? 

Difficulty of Securing Funding

The first step in addressing this challenge is understanding why securing funding for fire safety can be difficult. Healthcare facilities are often under significant financial strain, with rapid increases in expenses for labor, drugs, supplies, and equipment, as well as the impact of economy-wide inflation. 

The American Hospital Association reported in 2023 that the growth in hospital expenses has been more than double the increases in Medicare reimbursement for hospital care. Over half of U.S. hospitals ended 2022 at a financial loss, according to Kaufman Hall’s Operating Margin Index. 

What’s more, fire safety budget requests must compete with many other priorities, including the purchase of costly new technology – an MRI machine or a surgical robot – aimed at achieving strategic goals of expanding patient care capacity, increasing revenue, and keeping up with competitors.

Fire Safety is Crucial

Investing in fire safety may not be glamorous, but it remains crucial and indispensable. Of course, fire safety is absolutely critical for all types of buildings. However, when it comes to healthcare facilities, the stakes are even higher. These complex, busy facilities house vulnerable individuals, many of whom have limited mobility. Moreover, the staff-to-patient ratio may be inadequate for prompt evacuation during a fire, putting lives at risk. Additionally, there are hazardous chemicals and electrical devices present, further exacerbating the dangers.

Although hospital fires are rare, their consequences can be devastating. According to the National Fire Protection Association (NFPA), there were an average of 1,210 hospital fires per year in the US between 2012 and 2023, resulting in an average of $14 million in annual direct property damage.

Despite these alarming statistics, fire safety is sometimes overlooked or underfunded in hospitals due to limited financial resources and competing priorities. In April, an incident vividly highlighted the urgency of life safety. A devastating fire broke out at Beijing Changfeng Hospital, the flagship facility of a publicly traded medical care group with branches across China. This tragic event claimed the lives of 29 individuals and left 42 others injured. 

The fire erupted when a spark ignited flammable construction materials during a renovation project. An investigation by China’s State Council concluded that the fire compartments failed to effectively contain the spread of the fire allowing the fire and smoke to rapidly engulf the premises.

Barrier Management

The fire compartments that failed in Changfeng play a critical role in hospitals’ life safety strategy. Unlike office buildings and residential housing, which are designed for swift evacuation during fires, hospitals employ a defend-in-place approach, because of limited patient mobility. This involves isolating different sections of the building to safeguard occupants until they can be rescued by first responders or until active fire suppression methods, such as sprinklers, can eliminate the danger.

To ensure the effectiveness of the defend-in-place approach, it is crucial to consistently implement barrier management, specifically by utilizing passive fire protection and fire stopping. These measures confine the spread of heat, flame, smoke, and harmful gasses. It is of utmost importance to remain vigilant and promptly address any issues. Effective compartmentation consists of three essential components — fire doors, smoke dampers, and wall integrity. 

Fire door compliance is challenging because doors and hardware are subjected to constant use and need continual attention to correct misalignment, dents, holes, and deficiencies. Healthcare facilities require comprehensive surveying, labeling, and repair for all fire-rated doors to avoid compliance gaps and safety risks.

Fire damper compliance is a less visible, but crucial component of life safety that is too often overlooked. Dampers are the first line of defense against flame, smoke, and heat during a fire. While inspections are only required every six years for hospitals (one year after installation), and every four years for nursing homes and long-term care facilities, just one faulty damper can have catastrophic consequences.

Fire barrier compliance requires vigilance. With regular building maintenance and upgrades, facilities may be left with non-compliant holes and barrier penetration that compromise fire safety. Improperly maintained penetrations of floor assemblies facilitate the rapid vertical spread of smoke and fire within a building.

Proven Strategies to Secure Funding

In addition to the challenges mentioned earlier — constrained hospital financial resources and competing priorities — facilities directors often face another hurdle: limited experience with corporate budgeting processes. 

Moreover, hospital facilities directors typically ascend from one of the building trades, such as HVAC or electrical, and therefore may lack expertise in fire barrier management practices and compliance requirements. 

For these reasons, healthcare facility directors often develop long-term relationships with strategic partners specializing in healthcare facility fire safety. These partners provide essential services for life safety system inspection, installation, and maintenance, as well as planning and reporting required for compliance and budgeting.

Facilities managers can effectively secure funding for life safety by implementing these six proven strategies.

1. Understand the Budgeting Process:

Gain a deep understanding of your hospital or hospital network’s budgeting process. Familiarize yourself with the financial objectives, strategies, challenges, and both short-term and long-term goals. Learn the budget cycle, the decision-making process, and policies for allocating capital and operating funds. 

2. Build a Strong Relationship with the CFO:

Develop a strong working relationship with your hospital’s Chief Financial Officer (CFO). Familiarize yourself with the CFO’s priorities, preferred approach, and information requirements.

3. Collaborate with a Strategic Partner:

Work with a strategic partner who specializes in healthcare facility fire safety. Select a partner who not only has skilled inspectors and technicians, but importantly, a partner who also shares your goals and can assist you in navigating the complexities of hospital budgeting processes.

4. Develop Compelling, Well-Documented Budget Proposals:

Budget requests need to be based on a comprehensive understanding of your facility’s fire barrier systems and their current state of compliance. This includes identifying any deficiencies, evaluating the age and condition of existing systems, and determining necessary repairs or upgrades. Highlight the safety risks and financial consequences of deficiencies and non-compliance.

5. Seek Capital Funds:

Strategically structure budget proposals to maximize opportunities to secure capital funding. By proactively addressing fire safety measures with comprehensive capital-funded projects, hospitals can ensure the well-being of their patients, staff, and infrastructure. Investing in a proactive, comprehensive fire safety program is more efficient than dealing with problems reactively after a failed compliance inspection, avoiding costly emergency situations and piecemeal corrections. 

Additionally, CapEx provides a financial benefit to the hospital by allowing for more funds to be raised and depreciated over extended periods of time. This funding strategy can help alleviate the strain on the hospital’s budget and provide long-term financial stability.

6. Submit Budget Requests Early and Often:

Timing is crucial. Ensure that you submit requests in a timely manner, as required by the budgeting process, typically around six months prior to the start of the fiscal year. Familiarize yourself with the capital committee’s meeting schedule and align your submission accordingly. Additionally, it is worth noting that funds often become available throughout the year, particularly toward the end of the fiscal year. Therefore, it is advisable to regularly update and resubmit your requests.

These strategies have proven effective in ensuring that fire safety remains a priority, despite the many challenges facing hospitals today. By proactively managing your budget and effectively advocating for necessary funds, you can help maintain long-term financial stability for your organization while also promoting the safety of patients, staff, and visitors.

Subscribe to Industry Today