Trends in U.S. Hospital, Nursing Home and Residential Facility Foodservice
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The future of hospital & nursing and residential care foodservice is bright, with foodservice hospital & nursing and residential care expenditures reaching $34.0 billion in 2010, a 3.7% increase from 2009, according to Packaged Facts’ Trends in U.S. Hospital, Nursing Home and Residential Facility Foodservice. Underpinning the largest and fastest-growing sector of the U.S. economy, hospital & nursing and residential care foodservice programs can count on serving an increasing pool of patients, employees, and visitors. For foodservice operators, a shrinking pool of mouths to feed is simply not on the menu, which informs much of our positive outlook.
However, uncertainty looms in the form of government healthcare spending; the enactment of the Patient Projection and Affordable Care Act; and addressing state and federal budget shortfalls. We view contract management companies as potential winners of a budget crunch.
The future of hospital & nursing and residential care foodservice is bright, with foodservice hospital & nursing and residential care expenditures reaching $34.0 billion in 2010, a 3.7% increase from 2009, according to Packaged Facts’ Trends in U.S. Hospital, Nursing Home and Residential Facility Foodservice. Underpinning the largest and fastest-growing sector of the U.S. economy, hospital & nursing and residential care foodservice programs can count on serving an increasing pool of patients, employees, and visitors. For foodservice operators, a shrinking pool of mouths to feed is simply not on the menu, which informs much of our positive outlook.
However, uncertainty looms in the form of government healthcare spending; the enactment of the Patient Projection and Affordable Care Act; and addressing state and federal budget shortfalls. We view contract management companies as potential winners of a budget crunch.
- Among the conclusions drawn in the report, foodservice programs should not only emphasize women’s nutritional and other health-driven considerations, but also be informed about the different ways women view food generally, whether at home or at restaurants. This need is even more pronounced at assisted living facilities.
- The report also concludes that a wealth of opportunity exists to tailor foodservice programs around family caregivers. Under these circumstances, a person’s relationship with food may understandably change, and foodservice plays an important role. This explains why those dealing with illness are more apt to use a variety of foodservice types.
- And while the presence of restaurant brands can provide hospitals with a health dilemma, we view hospital-based restaurant establishments as a component of foodservice consumers expect. Restaurant brands that forcefully play the health card can offer a win-win proposition for hospital foodservice.
- The report also identifies the following trends as “primary” with positive momentum: Room service and individualized patient care; customer service; wellness and nutrition; variety and culinary exploration; sustainability and green initiatives; and the need for speed.
- In a unique approach to quantifying market opportunity, the report assesses “meal opportunity” for inpatient and outpatient hospital, assisted living, and hospital employee settings.
- CHAPTER 1: EXECUTIVE SUMMARY
- Scope and Methodology
- Scope
- Methodology
- Consumer survey methodology
- Industry Framework and Drivers
- Insight Capsule
- Fast Facts
- Foodservice Usage & Outlook Tracker
- Insight Capsule
- Fast Facts
- Share of Stomach: Sales Analysis
- Insight Capsule
- Fast Facts
- Hospitals & Restaurant Brands
- Insight Capsule
- Fast Facts
- Hospital Foodservice Trends
- Insight Capsule
- Fast Facts
- Hospital Program Analysis
- Cleveland Clinic
- UCLA Medical Center
- University of Washington Medical Center
- Hospital Foodservice Management
- Self-management versus contract management
- A loyal—and growing—following?
- The tighter the budget becomes, the more outsourcing becomes attractive
- Bottom line: contracts grow but overall revenue flattens
- Aramark
- North America Health Care Sector
- Strategy: partnering in patient care, custom menus, branding
- Partnering in patient care
- Custom menus
- Branding
- Sodexo Inc
- North American Health Care
- Health care foodservice strategy: high-value custom offerings, nutrition services
- High-value custom offerings
- Nutrition Services
- Compass Group PLC
- Compass Group North America (CGNA)
- North America Health Care Sector
- Strategy
- Personalized Care
- Retail Branding
- Retail Strategy
- Healthcare Services Group, Inc.
- Sales analysis
- Foodservice strategy
- CHAPTER 2: INDUSTRY FRAMEWORK AND DRIVERS
- Overview
- A massive captive foodservice audience
- Employee meal opportunity: $1 billion
- 53,000 locations and counting
- Table 2-1: Hospital, Nursing and Residential Facility Establishments, 2005-2009
- 6.4% of U.S. workforce, with higher than average earning power
- Table 2-2: Hospital, Nursing and Residential Facility Employee Earning Power, 2009
- Healthcare employment trends assure more mouths for foodservice to feed
- An employment behemoth that is only getting bigger
- Aging population to drive employment need—and patient foodservice need
- Table 2-3: Population Projection, Age 65+ and Age 85+, 2010-2025
- Nursing and residential care job growth to be twice the rate of hospital employment
- Table 2-4: Healthcare Employment Projections, 2008-2018
- Hospitals
- Overview and hospital types
- General hospitals
- Special hospitals
- Rehabilitation and chronic disease hospitals
- Psychiatric hospitals
- Community hospitals
- Almost a million beds and 40 million admissions
- Table 2-5: U.S. Hospitals, by Type and Operational Characteristics, 2009
- General hospitals predominate
- Table 2-6: Hospital Facility Establishments, by Type, 2005-2009
- Average length of stay stable over time, with demographic variations
- Table 2-7: Average Length of Stay Trends, Gender Analysis, by Age
- Hospital patient meal opportunity: millions and millions served
- Table 2-8: Inpatient Meal Opportunity, Community Hospitals, 2000-2008
- Patient illnesses and treatments strongly determine foodservice approach
- Male and female admission rationales significantly different
- Table 2-9: Surgical Procedures, Type of Procedure, by Sex
- Table 2-10: Hospital Earning Power & Foodservice Labor Expense,
- by Hospital Type, 2009
- Nursing and Residential Care Facilities
- A more labor-intensive environment calling for greater degree of salary allocation
- Assisted living facilities
- Table 2-11: Nursing and Residential Care Facility Earning Power
- & Foodservice Labor Expense, by Type, 2009
- Residential care licensing types evolving toward “assisted living” terminology
- State licensing and regulatory approaches
- Institutional model
- Housing and services model
- Service model
- Umbrella model
- Multiple levels
- Services, demographics and fees
- McDonald’s watch out: assisted living meal opportunity may be a billion a year
- Inpatient meal opportunity outstrips that of hospitals
- Service assessment
- Room and board rates
- An overwhelmingly female demographic
- Table 2-12: Assisting Living Facilities: Key Demographics, 2009
- Nursing homes
- Table 2-13: Nursing Facilities: Key Operational Statistics, 2010
- A higher degree of assistance required
- Less than half of nursing home residents can eat independently
- Table 2-14: Nursing Facilities: Patient Characteristics, 2010
- Mental health facilities
- CHAPTER 3: FOODSERVICE USAGE & OUTLOOK TRACKER
- Packaged Facts’ Consumer Restaurant Tracker
- Table 3-1: Foodservice Categories and Types
- February 2010 food retail momentum continues through October 2010
- Graph 3-1: Consumer Restaurant Tracker: Current Behavior: A Top Line View
- Looking ahead: Consumers more likely to save & spend on groceries than spend at restaurants
- Intended behavior portends full-service restaurant pullback
- Graph 3-2: Consumer Restaurant Tracker: Next 3 Months: A Top Line View
- Saving money remains at the forefront; intention to save spreads
- Graph : Consumer Restaurant Tracker: Future Behavior: Saving Money
- Foodservice usage and usage frequency
- Overview
- Limited-service restaurants
- Full-service restaurants
- Snack and beverage concepts
- Institutional foodservice
- Table 3-2: Foodservice Establishment Usage and Mean Use, 2010
- Foodservice and institutional foodservice usage analysis
- Note on reading charts
- Foodservice category use
- Age
- Graph 3-4: Foodservice Usage in Last Month, by Foodservice Category, Age 2010
- HH income
- Graph 3-5: Foodservice Usage in Last Month, by Foodservice Category, HH Income, 2010
- Work status
- Graph 3-6: Foodservice Usage in Last Month, by Foodservice Category, Work Status, 2010
- Population density
- Graph 3-7: Foodservice Usage in Last Month, by Foodservice Category, Population Density, 2010
- Institutional foodservice category use
- Gender
- Graph 3-8: Institutional Foodservice Use in Last Month, by Foodservice Category, Gender, 2010
- Age
- Graph 3-9: Institutional Foodservice Use in Last Month, by Foodservice Category, Age, 2010
- HH income
- Graph 3-10: Institutional Foodservice Use in Last Month, by Foodservice Category, HH Income, 2010
- Work status
- Graph 3-11: Institutional Foodservice Use in Last Month, by Foodservice Category, Work Status, 2010
- Population density
- Graph 3-12: Institutional Foodservice Use in Last Month, by Foodservice Category, Population Density, 2010
- Hospital Users
- Bottom line: dealing with illness correlates with foodservice use
- Relationship with food changes; foodservice plays important role
- Table 3-3: Hospital Users, Foodservice Use by Type, 2010
- Caregiver restaurant usage & food, health and diet attitudes
- Caregiving pressures may draw caregivers to full-service restaurants
- Table 3-4: Caregiver Restaurant Usage Frequency, Family and Fast Food Restaurants, 2010
- But kids also play a role
- Caregiving adds a layer of restaurant use
- Table 3-5: Caregiver Restaurant Usage Frequency, Family and Fast Food Restaurants, Kids, 2010
- Caregiving an added burden for parents
- Graph 3-13: Caregivers, Influence of Children
- And for grown children
- Graph 3-14: Caregivers, Influence of Age
- Hectic life of the caregiver reflected in food, health and diet attitudes
- Table 3-6: Caregiver Food, Health and Diet Attitudes, Strength of Agreement, 2010
- CHAPTER 4: SHARE OF STOMACH: SALES ANALYSIS
- Summary analysis
- The future of hospital & nursing and residential care foodservice is bright
- With significant caveats
- Contract management may win share
- Cost cutting versus revenue generation
- Packaged Facts hospital& nursing and residential care market size and forecast
- Graph 4-1: Hospital & Nursing and Residential Care Foodservice Sales, 2005-2012
- National Restaurant Association market size and forecast
- Graph 4-2: Hospital & Nursing Home Foodservice Sales, Contract Management Share, 2001-2009
- U.S. Economic Census foodservice contractor market size
- Table 4-1: Foodservice Contractor Revenue, Hospital & Nursing Home Share, 2007
- Foodservice contract management contracts grow while revenue flattens
- Table 4-2: Foodservice Contract Management Performance, 2008-2009
- Table 4-3: Foodservice Contract Management, Hospitals Contracts, 2008-2009
- Growth factors
- Industry growth to drive foodservice increase
- Hospital spending grew 5.9% in 2009; solid growth ahead
- Nursing home care expenditure growth rate to increase
- Graph 4-3: Hospital and Nursing Home Care Expenditures
- & Projected Expenditures, 2005- 2019
- Buoyed by government funding
- Table 4-4: Healthcare Expenditure Receipts, By Source
- Graph 4-4: Hospital and Nursing Home Care Expenditures & Projected Expenditures, Public Funding, 2009-2014
- Serving an aging population
- Table 4-5: Population Projection, Age 65+ and Age 85+, 2010-2025
- Table 4-6: Hospital, Nursing and Residential Facility Employee Earning Power, 2009
- Key hospital performance measure undervalues foodservice
- HCAHPS survey leaves out foodservice!
- So what?
- Meal opportunity analysis
- Inpatient hospital foodservice meal opportunity stagnates through decade
- Table 4-7: Inpatient Meal Opportunity, Community Hospitals, 2000-2008
- Meal opportunity highest among female and older patients
- Table 4-8: Inpatient Meal Opportunity, Gender and Age Analysis
- Outpatient hospital meal opportunity outstripped inpatient opportunity
- Table 4-9: Outpatient Meal Opportunity,
- Community Hospitals, 2000-2008
- Pricing and expenditures
- Average hospital check on the rise
- John H. Stroger Jr. Hospital of Cook County: foodservice expense primer
- Table 4-10: John H. Stroger, Jr. Hospital Of Cook County,
- 2009 Foodservice Expense Analysis
- CHAPTER 5: HOSPITALS & RESTAURANT BRANDS
- Restaurant brands at hospitals: a tug-of-war pitting health against revenue
- The dilemma
- A violation of trust?
- The bottom line: healthy brands have room to grow
- Restaurant brand penetration above 40%
- Table 5-1: Frequency of Brand Name Fast Food (BNFF)
- Franchises at 233 Academically Affiliated Hospitals
- Table 5-2: Food Outlet Analysis, U.S. Children’s Hospitals
- Barometer for fast food penetration at children’s hospitals set at 30%
- 1 in 4 children’s hospitals with fast food franchises
- Fast food presence influences food purchases and perceptions
- Does food purchasing at a hospital with a McDonald’s differ from those without one?
- Study parameters
- A strong McDonald’s skew!
- Table 5-3: Children’s Hospital Study, Fast Food and McDonald’s Purchases
- Why did they pick McDonald’s?
- Convenient location and child preference
- Table 5-4: Children’s Hospital Study, McDonald’s Purchase Rationales
- The Subway alternative
- Where are they now?
- 30,000 McDonald’s in the U.S. but only 32 in hospitals
- Mayo Clinic: “Live Well” and eat Zpizza
- Cleveland Clinic: McDonald’s on the way out; GO! Foods on the way in
- Ten-year battle with McDonald's coming to a close
- Fruit and walnut salad first offered here
- GO! foods a healthy option
- Brands galore
- UCLA Medical Center
- Johns Hopkins Hospital
- University of Alabama Hospital
- Other hospitals
- University of Pittsburgh's Magee-Women's Hospital's
- Children's Hospital of Philadelphia
- Massachusetts General Hospital
- University of Washington Medical Center
- Franchise cost analysis
- Local, independent brands; revenue-sharing
- Healthier restaurant profiles a better sell
- Contracts that address degree of risk-reward
- CHAPTER 6: HOSPITAL FOODSERVICE TRENDS
- Hospital Foodservice Trends
- Overview: trend prevalence and momentum
- Primary trends
- Room service and individualized patient care
- Customer service
- Wellness and nutrition
- Variety and culinary exploration
- Sustainability and green initiatives
- The need for speed
- Secondary trends
- Visual stimulation
- Catering
- Room service and individualized patient care
- Personal dining care: examples
- Variation in services
- Customer service!
- University of Washington Medical Centeruse of feedback
- The need for speed
- Examples
- Food safety
- Examples
- Minimizing disease transmission
- Examples
- Wellness and nutrition: the obvious is actually not obvious
- Pros to healthier hospital foodservice
- Cons to healthier hospital foodservice
- Wellness and nutrition initiatives in the upswing
- Menu labeling catching on
- Variety
- Examples
- Culinary exploration
- Examples
- Chefs on board
- Special discounts and incentives to dine in the hospital
- Would you make a trip to the hospital just to eat the food?
- Green initiatives
- Examples
- Visual stimulation
- Driven by restaurant competition
- Food as visual stimulation
- Catering
- Integrated technological systems
- Building staff collaboration, knowledge, and morale
- CHAPTER 7: HOSPITAL PROGRAM ANALYSIS
- Cleveland Clinic
- Overview
- Patient profile
- Table 7-1: Cleveland Clinic, Demographic Data, Treated Diabetics
- Foodservice programs and services
- Multitude of dining options
- Ousting chains
- Pizza Hut leaves; McDonald's stays
- Management split between Sodexo and AVI Food Systems
- Room service an extra: get a Founders Suite
- Foodservice growth trends
- Emerging trends
- 2009-10 foodservice initiatives
- Future initiatives
- UCLA Medical Center
- Overview
- Demographics
- Foodservice programs and services
- Signature Dining, anyone?
- Customized service
- The backend meets the front end: how it works
- A diverse menu to meet needs of a diverse population
- Café Med: serving 1.2 million customers a year
- Offerings and sales trends
- Catering at 10 years of age
- Foodservice growth trends
- 2009-10 foodservice initiatives
- Foodservice philosophy
- Overnight café
- Price increases
- Future initiatives
- UCLA Medical Center -numbers recap
- University of Washington Medical Center
- Overview
- Patient and employee profile
- University of Washington Medical Center
- 2009 statistics
- Harborview Medical Center, Staff Ethnicity
- Harborview Medical Center, Patient Ethnicity
- Foodservice programs and services
- General, renal, heart healthy, and low fiber/soft menus
- Room service reduces food and supply costs; limiting overtime reduces labor costs
- Equipment upgrading
- Plaza Café: local chefs, expanded offerings
- Harborview Medical Center
- Foodservice growth trends
- Emerging trends
- 2009-10 foodservice initiatives
- Future initiatives
- University of Washington Medical Center -numbers recap
- CHAPTER 8: HOSPITAL FOODSERVICE MANAGEMENT
- Self-management versus contract management
- Self-managed hospital foodservice still holds sway
- A loyal—and growing—following?
- An issue that stirs passion among the faithful
- Hospital CEO plays pivotal role
- The tighter the budget becomes, the more outsourcing becomes attractive
- Cost concerns favor contractors
- Outsourcing trend among government institutions?
- Bottom line: contracts grow but overall revenue flattens
- Table 8-1: Foodservice Contract Management Performance, 2008-2009
- Table 8-2: Foodservice Contract Management, Hospitals Contracts, 2008-2009
- Table 8-3: Foodservice Contractor Revenue, Hospital & Nursing Home Share, 2007
- Aramark Corp
- Foodservice operations
- Sales analysis
- North America Business and Industry Sector
- North America Education Sector
- North America Health Care Sector
- Patient foodservice
- Retail foodservice
- Facility services
- Strategy: partnering in patient care, custom menus, branding
- Partnering in patient care
- Custom menus
- Branding
- Table 8-4: Aramark by the Numbers
- Sodexo Inc
- Corporate Foodservice
- Education Foodservice
- North American Health Care
- North American Health Care Foodservice
- Patient dining services
- Visitor & staff dining services
- Retail foodservice
- Health care foodservice strategy: high-value custom offerings, nutrition services
- High-value custom offerings
- Nutrition Services
- Market trends & Sodexo response
- Health care expenditures
- Patient consumerism
- Shortage of health care personnel
- Table 8-5: Sodexo by the Numbers
- Compass Group PLC
- Compass Group North America (CGNA)
- Sales analysis
- Foodservice strategy
- Room for growth
- It Takes You - Eat Local
- Leveraging role of single-source provider
- Selective acquisitions
- North America Health Care Sector
- Patient Foodservice
- Senior Living Foodservice
- Retail Foodservice
- Support Services
- Strategy
- Personalized Care
- Retail Branding
- Retail Strategy
- Table 8-6: Compass Group by the Numbers
- Subsidiaries
- Healthcare Services Group, Inc.
- Sales analysis
- Foodservice strategy
- Future growth
- Table 8-7: Healthcare Services Group, Inc. by the Numbers
- Miniprofiles
- AVI Food Systems, Inc
- Unidine Corp.
- Prince Food Systems, Inc.
- Appendix
- Works Referenced