A Sign of the Times

Coming Soon, North Shore University Health Systems Medical Office Building.

For me, this is sad news. I am not saddened that North Shore University Health is opening yet another medical office building. It is where they are opening that gets me. They are taking over a two story building that used to house a Border’s Bookstore. My Border’s Bookstore. Sure, Border’s may have been a bit corporate, but this was still a great bookstore. They sold best sellers there, of course, but they also carried all the classics and lots of eccentric titles. Heck, they even briefly carried one of my own books! They had a vast selection of books about military history and an amazing travel section. My wife lost herself for hours in gardening and my sons ogled the aisles of mystery and fantasy novels. Border’s also had vast CD and DVD departments (with classical CDs and Criterion Collection movies) and the café sold a chocolate bundt cake that was out of this world. Maybe best of all, the building had an odd layout with lots of nooks and crannies and surprises around the corner. For a corporate bookstore, it oozed charm. Medical office buildings never ooze charm.

Border’s is not the only retail chain to suffer in the new economy. The adjacent Office Depot is also shuttered. The strip mall directly to the north lies nearly deserted and the strip mall directly to the west is struggling, having lost Blockbuster Video, Best Buy, and the giant Great Indoors (a failed Sears venture). Of course, NSUH is not to blame for any of these closings. Put that at the doorstep of Amazon and Costco. Yet with healthcare eating up more and more of our disposable income, who can blame consumers if they are reluctant to burn gasoline in order to pay retail for most goods and services. It seems that healthcare is the big exception.

A decade ago, it seemed that there was a new bank opening on every street corner. The stock market collapse of 2008 put paid to that trend. (Ironically, two of the banks that closed near my house now house physician offices.) Now, our medical providers gobble up all available real estate (dare I say, medical providers are metasthesizing?) But I don’t expect health care to suffer the same fate as banks. Banks fell victim to a bubble economy; there is no bubble in healthcare. Healthcare spending is going to keep growing; the only question is how fast.

Fortunately for all of us, our doctors, hospitals, minute clinics and everyone else who cares for us will be able to find lots of cheap real estate. That ought to hold down health care spending a wee bit. Heck, there is a Barnes and Noble in a strip mall just a few miles from my home that is nearly deserted every time I visit. I doubt it will last much longer. With lots of available parking and a Whole Foods nearby, this would be a great location for a wellness clinic.

Postscript: I just returned from a walk around downtown Evanston. There, I noticed that the Border’s Bookstore has been converted to a Northwestern Memorial Medical Group office building. This is mind boggling!

David Dranove, PhD, is the Walter McNerney Distinguished Professor of Health Industry Management at Northwestern University’s Kellogg Graduate School of Management, where he is also Professor of Management and Strategy and Director of the Health Enterprise Management Program. He has published over 80 research articles and book chapters and written five books, including “The Economic Evolution of American Healthcare and Code Red.” This post first appeared at Code Red.

10 replies »

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  2. Exactly. But when they add the letters “ACO-PCMH” to their names, everything will be wonderful.

    This is precisely the reason why Dr. Lamberts’s work is so praise worthy: if he saves just a thousand patients from big box medicine, he’s done a good job.

  3. The tentacles Of UNC and Duke health care satellite clinics around Chapel Hill area does not bode well for patient prices. They crowd out any other “competition” in the community and charge the highest prices.

    Direct example would be an imaging center that UNC bought out in Burlington after which prices for x-rays went from $35 per shot cash pay to about $150 – $200 per shot.

  4. I found the “customs agent” part confusing, maybe it was just me. But after much searching I believe the best term to use is customs broker, if I am not mistaken. Seemed to bring up plenty of results and options for me on google. Just in case any of you were thrown of by that. Regardless though, thank for the information. Very useful like the rest of your articles.

  5. I hope that North Shore University Health Systems can make up for the lost Borders with a unique consumer experience: focus on wellness with fitness area, botox and plastic surgery; healthy snacks and glutenfree bakery (heck, maybe they can keep the chocolate bundcake), massages and maybe a few free backrubs for satisfied customers; natural stone, healing garden, player piano and maybe at peak times life music (not much shortage of qualified student musicians in Chicago). Of course the docs should be handpicked to be great communicators and keep patient satisfied with thorough work ups with plenty of scanning, if so desired.

  6. The demise of book stores and of print books is, in my opinion, a good thing. Less resources spent shipping, manufacturing and tree cutting and driving to the book store, I don’t think that’s the fault of health care. Ebooks are here to stay.

    However one statement you made does pose a threat to non-health care businesses: “Yet with healthcare eating up more and more of our disposable income” This is a reality if health care spending is not controlled. Other disposable income areas could be pensions and housing.

    By the way the banks falling victim to a “bubble” economy was a result of fraud, in real estate, in banks and in Wall Street.

  7. Oh, but there is a bubble in health care….
    For each of those mega-clinics opening up in places like Evanston, there are dozens of little “mom and pop” clinics shutting down, or never opening, everywhere else.
    What is peculiar about the health care bubble, and what makes this a bubble, is that services sold in the new mega-clinics are more expensive and many times less pleasant than what the little clinics offered.
    This would have never been possible in the bookstore market or any other market for that matter…