Healthcare organizations spend millions, and sometimes billions, on capital projects intended to improve care. Yet too often, those investments are made under pressure, based on visible pain points, and aimed at symptoms rather than root causes. In this episode of The Architecture of Healing, host Chase Miller sits down with Bill Hercules to unpack a hard truth: great healthcare design isn’t just about form, function, or code compliance, it’s about understanding finance, incentives, and the operational reality that determines whether a facility actually performs.
Bill brings a rare perspective to the conversation. As a triple-Fellow in the American Institute of Architects (AIA), the American College of Healthcare Architects (ACHA), and the American College of Healthcare Executives (ACHE), he has spent decades bridging the worlds of architecture and executive decision-making. That blend matters, because hospitals don’t make design decisions the way architects do. Health systems make decisions through the lens of risk, margin, mission, and long-term viability and the built environment is ultimately a tool to support care, not the end goal itself.
Why architects struggle with healthcare finance
Bill traces part of the disconnect back to how architects are trained. Architecture school often emphasizes theory and possibility, removing constraints so students can explore what design could be. But the industry doesn’t always bring designers back to the practical realities that drive healthcare projects: What does it cost? What is the value? How do you translate design outcomes into dollars, risk reduction, or operational performance?
In practice, many architects outsource financial understanding, hiring accountants, relying on project managers, or avoiding the numbers altogether. Bill argues this is a fundamental weakness in healthcare work. If architects want to have meaningful conversations with executives, they must learn the language leaders use to prioritize investments: net present value, operational cost implications, reimbursement dynamics, risk mitigation, and the thin margins that shape what’s possible.
One of the most useful frames Bill offers is that architects and CFOs often see the world through different operating systems. Architects are trained to envision and optimize environments. CFOs are trained to protect stability, reduce risk, and ensure capital investments don’t compromise long-term sustainability. Aligning those mindsets isn’t optional. It’s the only way design can become strategy.
“No margin, no mission” and the real purpose of buildings
Bill and Chase return to a phrase that every healthcare leader understands: no margin, no mission. Nonprofit systems may be mission-driven, but they still have to generate financial strength to sustain that mission. As Bill points out, years after ribbon-cutting ceremonies and glossy photos fade, the only question that matters is: What value is that building contributing to care and community outcomes?
This is where many design teams lose the thread. Architects can take pride in the finished product because for the designer, that building is often “the thing.” For a health system, it’s a means to an end: a platform that enables clinical performance, operational reliability, safety, patient experience, and community trust. Bill makes it plain: health systems are not in the building business, they’re in the care business.
At the same time, he doesn’t dismiss beauty. A well-designed hospital projects confidence. It signals competence and stability in a place where the stakes are literally life and death. Architecture becomes a visible symbol of operational excellence and institutional trust. The challenge is not choosing between beauty and performance. The challenge is making sure capital strategy supports both—and that design decisions can be defended in the same language executives use to steward resources.
The changing competitive landscape and the “four-dimensional chess” of healthcare
The conversation also touches on the evolving market dynamics shaping capital strategy, including shifts in Certificate of Need (CON) regulations. Bill describes how deregulation can open the floodgates for growth, but not without consequences. In markets where barriers fall, competition intensifies, new facilities emerge, and the strategic game becomes more complex. Health systems are using more data than ever, more frequently than ever, to anticipate competitor moves and reposition service lines.
Chase raises a key concern: when competition becomes a constant chess match, does focus drift from patients to market positioning? Bill pushes back with a “both-and” mindset. Patient care remains central for mission-driven leaders, but the business environment has become more complicated—and organizations must navigate that complexity to keep delivering care.
Evidence-based design, ethics, and doing your homework
One of the strongest threads in the episode is the gap between research and execution. Bill argues that architects have an opportunity and maybe even a responsibility, to step into a higher order of design authority: not just aesthetics, but physiological, neurological, and evidence-based outcomes. Yet many don’t. They stay in the comfortable territory of code, standards, and habitual solutions.
He uses a practical example: the well-documented benefits of natural views. The research is robust, yet codes and standards tend to treat windows as safety devices (egress, rescue access, fire department operations), not therapeutic interventions. That creates an ethical tension: if we know an intervention can improve outcomes, but it costs more upfront and adds operational complexity (glare, heat gain, envelope costs), who is responsible for bringing the full picture to decision-makers?
Bill’s answer is blunt: the design team must do the homework. You can’t walk into an executive conversation with vague claims about “healing environments” and expect to win. You need to understand operational cost impacts, patient outcomes, length of stay dynamics, and even the perverse incentives embedded in reimbursement. If you can’t translate benefits into real tradeoffs, you’ll lose, and then complain that leadership “doesn’t get it,” when the truth is you didn’t come prepared.
Root causes: why projects often fix the wrong problem
A pivotal moment in the conversation is Bill’s classic example: emergency department overcrowding. The easy solution is to expand the ED and add more exam rooms—an expensive, politically attractive “easy button.” But often the real bottleneck is upstream: discharge inefficiency, delayed rounding, housekeeping constraints, or operational breakdowns in the bed tower. In those cases, spending $50 million on an ED expansion may do nothing but compound the problem.
This is why Bill and Chase emphasize the importance of the functional program. Without a disciplined process to define what the project is truly supposed to accomplish, teams default to assumptions and reactive fixes. A functional program doesn’t just clarify room counts—it forces the “why” questions that uncover root causes and align capital investment with operational reality.
Zooming out: health, culture, and personal responsibility
Late in the episode, Bill expands the question of “what should change in healthcare” to a broader cultural level. Rather than redesigning a room type, he argues the system is built to react to preventable conditions and that personal responsibility for health is a core driver of long-term sustainability. Whether listeners agree or not, the point is consistent with the episode’s theme: prevention and root-cause thinking beat reactionary, symptom-driven approaches.
Closing thought
This episode is a challenge to healthcare designers and leaders alike: stop defaulting to capital as the first answer. Diagnose the real problem. Learn the language of finance and operations. Bring evidence with rigor. And design not just for opening day, but for long-term performance, trust, and outcomes.
Because in healthcare, the best projects aren’t the most impressive buildings. They’re the ones that help a system deliver better care, sustainably, for decades.
