A multitude of lessons are being learned from the pandemic’s wake. In particular, location and proximity matter for certain types of activities connected to work, health and well-being. The pandemic has also heightened people’s awareness about mental health issues, compounded by the isolation and loss experienced during the pandemic. In new research by ITOM Professor Vishal Ahuja of SMU Cox and co-authors Alvarez and Staats, they show that proximity of physical spaces, that they refer to as co-location, matters. In the healthcare setting, co-location of providers in the same hospital or clinic can save money, but more importantly lives. Their findings about co-location relate to other business settings as well, with tech firms like Apple and Google purchasing new real estate to bring people back together. It’s not just about whether co-location matters to an organization but to whom it matters most and why.

In the U.S., the health care sector consumed roughly 17.7% of GDP, or $3.8 trillion, in 2019.[i] Ahuja mentions that, according to the Centers for Disease Control and Prevention, 9 out of 10 healthcare dollars in the United States are spent on individuals who suffer from chronic diseases such as diabetes or asthma and mental illnesses like depression, anxiety, or other types. This underappreciated problem in health care is “the Pareto rule on steroids,” says Ahuja. The Pareto rule is the 80:20 rule, wherein 80% of the consequence is caused by 20% of a group in this case.

The pandemic’s effect on mental health in both adults and children was a large influence for the study. “Mental health issues are off the charts,” says Ahuja. One in five adults experienced mental health illnesses each year, a number that is now risen to four in ten, according to the National Alliance on Mental Health in March 2021. There has been a movement towards co-locating or integrating physical health with mental and behavioral health services since the medical community advocated for the approach, but the impact on patient health was missing from the research literature.

Ahuja and his co-authors saw the relevance of co-location in the operations management literature, with decisions about location being an important operational choice. In knowledge-intensive work like tech firms, co-location can enhance the likelihood of collisions, or chance encounters and unplanned interactions between workers, that improve performance. Numerous studies have shown positive performance, communication, and quality improvements, resulting from co-location of people or teams. Their insights in the health care setting are a leap forward as the system grapples with containing costs and achieving better health outcomes. 

Being There Matters

The study analyzed data from patients with chronic health conditions – specifically diabetes and chronic kidney disease – and mental or behavioral health issues from the Veterans Health Administration, part of the Department of Veterans Affairs (VA). Often the two types of care go hand-in-hand, notes Ahuja. The data covered 300,000 patients, spanning 11 years. In the study, co-location, physically having both primary care and mental health care providers in the same facility, significantly improved the health benefits for patients. It also saved money for the system.

In the study, patients with chronic conditions were considered high risk, suffering from not only physical health conditions (eg. heart or kidney disease) but also mental health issues such as depression, PTSD, suicidal thoughts or attempts as well as substance abuse. Ahuja asks, “If a person had visited a primary care provider or a specialist who was in same facility as a counselor, psychiatrist or social worker, do outcomes improve? Just by having both the medical and mental health providers in the same facility, there is substantial evidence that physical proximity improves outcomes. This is irrespective of whether there is an interaction – formal such as a consultation or informal like a chance encounter – between the two types of providers.” Ahuja suggests that these findings illustrate why one should be more mindful of embedding [the right types of providers] or having them be in physical proximity.

From an execution standpoint, says Ahuja, “you reduce reasons why veterans wouldn’t seek care and enhance the likelihood that they’ll get the right type of care.” For example, traveling to two different types of doctors or health professionals in different locations is a burden, a logistical barrier. Think of it like one-stop-shopping. In discussions with Ahuja, a variety of VA leaders highlighted the fact that there is a stigma associated with seeking care for mental health, especially among veterans who are predominantly male. Co-location can help in that regard too.

Specifically, their research showed that a co-location approach would reduce hospitalizations as well as length of stay and 30-day readmissions of those hospitalizations. Co-location would also reduce suicide ideation or attempts, something Ahuja says is critical among veterans, who are twice as likely as civilians to die by suicide, according to the VA.[ii] Their study also showed that appointment no-shows were reduced and medication regimes were better followed as a result of co-location. The authors offer insights into how health care organizations can develop targeted interventions, which yield the highest benefit—better integrated care delivered to specific at-risk patients in the right way.

Co-location Applications

The concept of co-location stems from the management literature. “Co-location helps with productivity and firm performance, but in health care we’re talking about potentially saving lives,” says Ahuja. “Co-location is not new, but the application to high-risk patients is new.” It is not just about embedding a mental health professional in an outpatient setting with other providers,” Ahuja notes. “The very fact that you co-located can make a difference.”

In the VA setting with more severe patients, co-location has a direct link to health improvements but it offers a preventative side such as a screening tool. “In education, the research substantiates the idea of embedding teachers, counselors and coaches in schools,” notes Ahuja “By having them work together, you can identify at-risk children early on.”

In the virtual world, co-location has implications for remote working. “The Facebooks and Googles are buying buildings and calling employees back to the office, observing that productivity has declined throughout the pandemic,” says Ahuja. “Firms need to differentiate their types of workers. For those who are significant contributors to your company’s productivity or those generating ideas, a hybrid situation can provide flexibility.” He suggests having those employees on-site at a certain time on certain days, say 2-3 days per week, so you get the collisions that spark ideas.

The authors offer the healthcare system a path forward in dealing with the mental health issues amplified by the pandemic. Additionally, the ideas behind co-location are relevant for the shifts occurring with organizations’ activities, services and employees as the work world re-thinks its physical spaces and options.

The paper “How and in What Ways Does Co-location of Services Matter? Empirical Evidence from a Large Healthcare Setting,” By Vishal Ahuja, Southern Methodist University, Cox School of Business, Carlos Alvarez of Texas Tech University Health Sciences Center, and Bradley Staats of University of North Carolina at Chapel Hill, is currently under review. A clinical abstract of this paper is a finalist for the 2021 Dlin/Fischer Clinical Research Award, presented for significant achievement in clinical research and the best paper submitted for presentation at the annual meeting of the Academy of Consultation-Liaison Psychiatry (winner to be determined).

Written by Jennifer Warren.

[i] Cms.gov

[ii] https://www.mentalhealth.va.gov/mentalhealth/suicide_prevention/data.asp