Written by: Andy Draper, CEO, founder, Sion60
Summary: The Pope, The Joint Commission, bond markets, state and local governments are encouraging health systems to have a sustainability strategy that reduces carbon emissions to protect our communities and planet. In health systems, a comprehensive strategy crosses multiple departments including facilities, OR, ICU, finance, investments, HR, physicians, supply chain, vehicles, even quality leaders. This complexity requires strategy leaders to lean in and build thoughtful plans based on data - just like we do with strategic planning, growth and service lines plans. Based on our discussions with hundreds of hospital leaders, here are 10 strategies to get started.
1. Governance: Start a workgroup with a senior level sponsor, include medical staff, nursing, OR, ICU, marketing, HR, facilities and finance. Add a board member, if you’re feeling it.
2. First meeting, educate: There is a lot of information in all disciplines on how to start and build a compelling business case. The front line is your key to success.
3. Measure: HHS, CMS, TJC and bond and many state and local governments are asking for your carbon footprint. In California and Massachusetts data collection starts Jan 1, 2025.
4. Evaluate your utilities and energy budget: Don't just take last year's expense and add inflation. Are you getting the best price? What is their renewable energy strategy? Do they have rebates or energy savings incentives? You have spent a ton of money on your utility, they owe you a meaningful conversation.
5. Be aggressive with electricity: Rooftop and community solar are reimbursable with the Inflation Reduction Act. Also, consider a multi-year power purchase agreement to get better rates with 100% renewable energy and a renewable energy certificate (REC). Like a security, RECs are a tradable asset that can increase in value over time.
6. Transportation: Electrify your fleet. Build a multi-year capital plan to replace every vehicle you can with an electric one. There is cash available now through the Inflation Reduction Act. Business air travel ticket purchases can buy the airline's carbon offset for a few bucks. Evaluate commuting.
7. Your buildings are full of gold: Walk through your buildings and plant ops. Identify all hospital equipment over 20 years old. Ask your facility team for all projects that break-even in 10 years or less. Upgrade your building automation system.
8. Medical and clinical staff: Kick-off OR and ICU workgroups. This is where the most intense use of health services occur and there is a lot to do! Remove desflurane from the anesthesia gas formulary. Reprocess every instrument possible. Fund these workgroups with micro-grants and challenge them for ROI.
9. Supply chain: Notify your top 100 vendors you will ask for carbon footprints of their products. They are waiting for hospitals to ask.
10. Finance: All of the above creates a compelling, long-term business case. Also, evaluate your investment portfolio for dirty funds. No hospital owns tobacco stocks anymore.