The staggering number of regulatory and patient safety issues that come into play when leasing healthcare facilities has led to release of a guide entitled “Understanding Regulatory Issues in Leasing Medical Office Buildings and Healthcare Facilities.”
Researched and authored by B. Alan Whitson, RPA – President of Corporate Realty, Design, and Management Institute; this handy guide details the labyrinth of legal issues that healthcare providers, property-owners, investors, lenders, attorneys, architects, engineers, commercial real estate brokers, and property managers must navigate.
“Understanding the Regulatory Issues in Leasing Medical Office Buildings and Healthcare Facilities” is available online at the website of the Corporate Realty, Design & Management Institute.
Fueling the shift to leased rather than owned facilities is the explosive growth of urgent care centers and the popularity of placing outpatient clinics in traditional retail and office spaces. The number of retail clinics is projected to double by 2015, rising from 1,400 in 2012 to almost 2,900. The number of leased healthcare facilities will increase similarly.
“Real estate leases and the process of negotiating them is unfamiliar territory for many in healthcare,” says Whitson. “Equally many on the other side of the negotiating table are dealing with healthcare tenants for the first time too. The regulatory environment for healthcare facilities is a tangled web of rules, regulations, and guidelines from multiple federal, state, and local agencies. It’s a place where – what you don’t know can hurt you financially – pain points include fines and losing the right to receive payments from Medicare and Medicaid programs.”
Because Medicare and Medicaid payments can account for 60 percent or more of a healthcare provider’s revenue, regulatory compliance by tenants is crucial for property owners and lenders. Yet, the need to comply with regulations is not exclusive to tenants. A failure by a landlord, including its employees and contractors, to follow any number of rules can lead to severe consequences for a healthcare tenant including civil and criminal penalties. To further complicate matters, common commercial lease provisions and practices can expose a landlord to fines and possible criminal prosecution.
“Leasing healthcare facilities in today’s regulatory setting is similar to walking through a minefield. One misstep and you can be facing serious financial and legal problems.”
“Remember ignorance of the law is not a defense, and sometimes no intent is needed to be in violation,” adds Whitson. “It’s easy for the actions of a property owner, tenant, or other tenants in medical facility to have a negative impact on the other parties. Leasing healthcare facilities in today’s regulatory setting is similar to walking through a minefield. One misstep and you can be facing serious financial and legal problems.”
Understanding Regulatory Issues in Leasing Medical Office Buildings and Healthcare Facilities offers a road map to key federal statutes from the DOJ, DOT, EPA, FDA, OSHA, Center for Medicare and Medicaid, and Social Security Administration that apply to leasing and running medical facilities. Covered are
Whitson is a nationally renowned speaker on healthcare, facility management, leasing, and regulatory issues. His experience spans four decades and 40 million square feet of facilities worldwide. He is the author of multiple publications including 327 Questions to Ask Before You Sign a Lease.