How do health systems make high-impact capital decisions when full facility replacements are not feasible, budgets are constrained, and regulatory timelines are unforgiving? Southern California healthcare strategy leaders explored innovative approaches to facility planning, demonstrating how organizations can transform compliance obligations into strategic opportunities — preserving capital, reducing risk, and shaping the care environments of tomorrow.  

Moderated by Damir Vukovljak, Vice President at Jensen Partners, panelists included Gayathri Jith, Senior Vice President of Hoag Health System; Matthew Bader, Chief Strategy Officer at Providence; Paul Da Veiga, Vice President of Planning, Design & Construction at UCI Health; Peter Kung, Chief Strategy Officer at MemorialCare; and Sue Pietrafeso, Chief Strategy Officer at CommonSpirit/Dignity Health, California Region.   

Strategic Growth Requires More Than Expansion 

One of the clearest themes from the discussion led by Vukovljak was that healthcare growth today is no longer just about building hospitals. It is about creating flexible, financially sustainable systems capable of adapting to demographic shifts, technology changes, and regulatory requirements. 

Da Veiga discussed UCI Health’s transformation from a single-hospital system into a six-hospital network following the acquisition of four former Tenet hospitals and the development of its new Irvine campus. This expansion reflected a broader trend across healthcare systems seeking scale and regional integration. 

Growth strategies now extend far beyond acute care facilities. Ambulatory care, physician networks, urgent care centers, outpatient services, and digital health platforms are becoming increasingly central to healthcare delivery models. 

Capital Planning Has Become Increasingly Complex 

Healthcare leaders repeatedly returned to the challenge of capital allocation in an environment defined by rising construction costs, reimbursement pressures, labor shortages, and strict regulatory mandates. 

Pietrafeso noted that healthcare organizations must constantly balance “must-do” investments — such as seismic compliance, aging infrastructure upgrades, and regulatory requirements — with strategic growth initiatives designed to improve long-term competitiveness. 

For many systems, essential compliance projects come first, particularly in California where seismic regulations continue to drive significant investment needs. Only after those obligations are addressed can organizations pursue aspirational projects such as new campuses, expanded service lines, or advanced technology deployments. 

Bader discussed Providence’s long-term goal of investing approximately $6 billion to support both compliance requirements and strategic growth initiatives. That investment strategy reflects the scale of financial commitment now required to remain competitive and operationally resilient. 

Agility Is a Core Requirement 

Another major takeaway from the panel was the need for healthcare systems to remain agile in an environment where technology, reimbursement models, and patient expectations are changing rapidly. Traditional long-range planning models are becoming harder to maintain as artificial intelligence, digital care delivery, and evolving regulatory frameworks reshape the healthcare ecosystem. 

Panelists stressed that healthcare organizations must now design facilities, operating models, and strategic plans with flexibility in mind. Physical infrastructure must be adaptable enough to accommodate future clinical needs, technology integration, and changing care delivery patterns. 

This shift is particularly important as systems continue expanding outpatient and community-based care networks while also evaluating opportunities for mergers, acquisitions, and strategic partnerships. 

Mergers and Partnerships Will Continue Shaping Healthcare 

Scale increasingly matters for financial sustainability, operational efficiency, talent recruitment, and speed to market. As reimbursement pressures intensify and capital costs rise, partnerships and acquisitions are becoming essential tools for many systems seeking to expand geographic reach and service capabilities. 

Kung compared healthcare consolidation trends to those previously experienced in other industries, suggesting that healthcare may continue moving toward larger, more integrated delivery networks over the next decade. At the same time, successful growth strategies must remain rooted in community needs rather than expansion for expansion’s sake. 

Workforce Challenges Remain a Critical Concern 

Beyond infrastructure and capital planning, panelists acknowledged that attracting and retaining physicians, nurses, and specialized healthcare talent remains one of the industry’s greatest challenges. 

Jith discussed Hoag’s investment in training pipelines, integrated physician networks, and innovative care models designed to support workforce retention and improve care coordination. 

Several panelists emphasized that healthcare systems must integrate workforce strategy into infrastructure planning. Future-ready healthcare environments must support both patient outcomes and clinician experience. 

Healthcare’s Future Will Depend on Disciplined Innovation 

Ultimately, the panel underscored that healthcare systems are operating in one of the most complex environments ever faced. Organizations must simultaneously navigate regulatory mandates, financial pressures, technological disruption, workforce shortages, and growing community expectations, all while continuing to deliver high-quality patient care. 

The future of healthcare will require disciplined investment strategies, operational agility, collaborative partnerships, and a willingness to rethink traditional delivery models. For healthcare leaders, the challenge is no longer simply managing growth. It is building resilient systems, in service of our communities,  capable of adapting to an industry that continues to evolve at unprecedented speed.