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R&IEditorial Archives2003September 15 — Exclusive

With only one-third of meals served to patients, hospitals focus on retail operations

At Presbyterian Hospital of Plano in Plano, Texas, doctors still wear white lab coats but servers who deliver patient meals bedside sport tuxedos, complementing a menu that includes grilled salmon with coconut-dill cream and beef tenderloin with shiitake-chipotle sauce.

The hospital is reflective of the changes taking place in healthcare foodservice, an industry segment that has been substantially transformed over the past decade. From operations primarily focused on patient feeding and nutrition, hospital foodservice departments have blossomed into hospitality businesses where 68% of meals are served to staff, visitors and guests in stylish serveries and where foodservice directors wrestle with complex financial-planning and revenue-generation issues, often under increasingly sharp fiscal constraints.

Think of a hospital as business and industry with an operating room, says Michael Giuffrida, executive director of the Washington, D.C.-based National Society for Healthcare Food Service Management. Todays healthcare foodservice is a hospitality operation rather than simply a patient-foodervice operation.

The average acute-care facility now takes in $1 million in food-and-beverage cash sales annually, he adds. Some do far more, such as UCLA Medical Center in Los Angeles, whose retail sales topped $6 million last year.

A different skill set
Healthcare foodservices evolution into a commercial-mindset operationinvolving internal and community marketing, mining alternative revenue sources and managing higher food costsalso has transformed the roles of foodservice directors and staffs. Healthcare needs managers with M.B.A.-level aptitudes and kitchen employees with restaurant-level skills.

Now its all about management of a multimillion-dollar foodservice enterprise thats in an institution, says Giuffrida. Being a foodservice director today requires a different skill set than it did 10 years ago.

After nearly 20 years in the profession, Maria DeNicola, director of nutrition and food services at Lakeland Regional Medical Center in Lakeland, Fla., says her responsibilities have changed enormously in recent years. You have to be extremely savvy with financial knowledge; you have to know your benchmarks to judge how you are doing versus others, she says. As reimbursement [to the hospital for patient care] goes down, management looks at our support services for revenue generating. They want us to cut staff but still provide service at higher levels.

To meet such challenges, DeNicola says healthcare foodservice needs to recruit and retain qualified hourly and management-level employees. For supervisors and managers, DeNicola says that means providing thorough in-house training. If youre going to lead a department now, you have to do number crunching. I share that knowledge with supervisory personnel so they know what things cost and where were going.

Commercially trained chefs
More-sophisticated hospital menus require commercial-foodservice skills, and DeNicola says she has had little trouble luring chefs who have tired of the restaurant grind. They dont want to work 18 hours a day, seven days a week anymore, she says. They like healthcare because they work eight-hour shifts, Monday through Friday.

When Presbyterian Hospital of Plano adopted its Five-Star Dining program in Junewith tuxedoed waitstaff and room-service meal deliverythe facility hired restaurant-trained cooks to work with Chef Gary Vorstenbosch (who worked at Star Canyon restaurant in Dallas before joining the hospital), says Mary Spicer, its director of food and nutrition. Cooking to order from 7 a.m. to 7 p.m. is a 180-degree shift from cooking for 500 patients at regular meal hours, she explains. The room-service program has been well received by employees and patients alike. The tuxedos raise workers self-image. They look and feel more professional, Spicer adds.

Image bears attention because healthcare foodservices embrace of retail operations makes marketing increasingly important. That can mean bringing restaurant brands such as Sbarro, Blimpie or even McDonalds into a hospital, but lately it more often has meant partnerships with branded products.

With rising costs and revenue pressures, the dilemma [healthcare foodservice managers] face is: Do I increase the price of the meatloaf in the cafeteria or do I bring in Starbucks coffee? says Giuffrida. The CEOs of hospital systems will tell you almost unanimously to bring in a branded product and charge a premium for it.

Krispy Kreme has figured out that retail healthcare operations are a great place for them to sell doughnuts. And you know what? Theyre right.

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