We’ve written many times before to highlight Cornell’s Professor Miguel Gómez and his many contributions to increasing the body of knowledge relevant to the industry and to highlight his contributions to The New York Produce Show and Conference. We’ve profiled his presentations in pieces including:
There is no hotter subject in America than health care, and when we heard Professor Gómez was working at the intersection of the produce system and the health care delivery system, and wanted to present on the topic at The New York Produce Show and Conference, we eagerly said yes. Then we asked Pundit Investigator and Special Projects Editor Mira Slott to give us a ”sneak preview” of what Professor Gómez will talk about in New York:
Miguel J. Gómez, Ph.D.
Associate Professor
Dyson School of Applied Economics and Management
Cornell University
Ithaca, New York
Q: With Cornell University being a Charter Participant of The New York Produce Show & Conference’s University Interchange Program, you have played an important role by sharing your evocative research each year; both at the educational workshops, as well as moderating a panel and presenting at the Global Trade Symposium, co-located at the Show.
Your talks have included, a new hypothesis of “local” based on performance of local and mainstream supply chains; ongoing studies on development of an East Coast broccoli industry; and analysis of a NAFTA-wide transparent and efficient dispute resolution mechanism.
Now you branch out into a new area of study: Farm-to-Hospital Programs: Factors Influencing Hospital Participation. What are the key issues you set out to tackle?
A: The primary goal of the thesis is to identify the factors that influence a hospital’s decision to adopt a Farm-to-Hospital (FTH) program in healthcare facilities.in the Northeast region. This is achieved through the following objectives:
• Develop a regional survey for hospital foodservice directors in the NE region of the U.S. to assess their interest in FTH programs.
• Utilize data from the regional survey to present an empirical model to discover the determinants that influence a hospital’s decision to adopt an FTH program.
• Identify and explain the potential barriers to the adoption of FTH programs through case-study analysis.
I want to be sure to mention that the study was conducted by Bobby Smith, 2013 M.S. candidate, Professor Harry Kaiser, as well as myself at the Charles H. Dyson School of Applied Economics and Management at Cornell University.
Q: What provoked your interest in this research? Is there a dearth of knowledge in this area?
A: Our interest to study farm-to-hospital programs stems from the fact that when we think about local food systems, we usually think in terms of direct channels — farmers markets, for instance. To an extent, we have an institutional sector. We know some things about farm-to-school programs and how schools provide fruits and vegetables to increase intake, but there is very little evidence about this happening in hospitals. We don’t know much about how cafeterias and food service managers in hospitals think about procuring fresh fruits and vegetables to include more local produce in diets.
By nature, hospitals have to be consistent with what they do. They deal with health, and food is a part of that; providing a healthy diet includes fresh fruits and vegetables. It’s consistent with their business purpose.
There are some case studies that look at particular hospitals and how they develop their procurement for fresh produce and the importance they place on buying from local farmers, but there is a lack of macro analysis. These are specific case studies, but there isn’t a systematic study. What types of hospitals are more likely to buy fresh produce especially from the local community?
Q: Can you explain why you need to go beyond the current research available to a more systematic approach?
A: There is just anecdotal evidence of how hospitals develop these practices. What we do is interview more than 100 hospitals; how are they getting their procurement programs including local food into their menus.
Q: What is the regional scope?
A: We study farm-to-hospital programs in facilities focused in the northeast region, which includes New York, Connecticut, Massachusetts, New Hampshire, Maine, Pennsylvania, Rhode Island, and New Jersey.
We developed a survey for hospital foodservice directors in all these regions to learn their interest in farm-to-hospital programs. In addition to conducting a survey of more than 100 hospitals, we did three case studies, one in Ithaca, New York, one in New Milford, Connecticut, and another in Burlington, Vermont.
Q: Why those three?
A: We just wanted to get more in-depth opinions from the foodservice directors about various opportunities for procuring local produce.
Q: How did the information in the case studies compare to the more general surveys? Did they confirm or contrast with your overall findings? Were there significant differences?
A: No. The information from our case studies was very consistent with what we found in the more general survey. Essentially, our interest in doing these case studies is to make sure our survey results correspond.
Q: What did you learn?
A: We sent this survey to 160 hospitals and received 101 results, which was an amazing response rate. We called every single one of them to follow through.
In the survey we asked first, did they sign the Healthy Food in Healthcare Pledge, a national initiative for hospitals to provide healthy food.
Q: Is this a government or private program?
A: It’s a private initiative in the healthcare system, launched in 2006 by Healthcare Without Harm. We found 36 percent of our hospitals signed the pledge. That was an important indicator of how much they care about providing healthy foods.
We wanted to know if they signed the pledge; what was the budget for foodservice; how much they allocated for fruits, vegetables, meat, dairy and other products. We also wanted to know for each category how much was local in the product mix. Also, if they owned their own cafeteria or contracted with a third party to run it. We wanted to know hospital size and those kinds of characteristics.
Q: What other variables did you consider?
A: We collected secondary data from the census, regarding whether the hospital was located in a metropolitan or rural area. We also wanted to know the degree, what percentage of the county’s land was devoted to agriculture because we thought that would be an important link to the strength of the FTH program. We collected data in the proportion of farms that participated in some sort of direct market, either farmers market or community-supported agriculture to understand the extent of the local system where the hospital was located.
For example, if you have a county where 10 percent of the community is participating in local agriculture, you have a stronger local supply chain, compared to a county that has one percent participating.
Q: How is local defined?
A: That’s a very good point to bring up. We asked the hospitals what is local to you. More than half of our hospitals classified local between 100 to 200 miles away or within the state. This was the general consensus.
Q: That’s quite a range…What else did you learn about the make-up of your participating hospitals?
A: About 60 percent of the hospitals reported that they adopted a farm-to-hospital program, compared to the 36 percent that signed the Healthy Food Pledge we discussed earlier. We also found out about 60 percent operate their own foodservice, and the other 40 percent contract with a third party.
The hospitals we surveyed averaged serving 500 meals per day, but it ranged from 100 meals per day to more than 3,000 meals per day.
In addition, 21 percent of the hospitals we surveyed were in non-metro areas. That gives you an idea of our sample.
Q: So, what does this information reveal?
A: We wanted to find out what types of hospitals are more likely to adopt an FTH program. One thing we discovered, which might be interesting to your audience, is that hospitals with an FTH program tend to buy more fresh fruits and vegetables in general than the others. Of course, fruits and veg are associated with a healthier menu.
Similarly, hospitals that signed the pledge devote a larger size of their budget to fresh fruits and vegetables.
Q: How much larger?
A: In our sample, on average, fresh fruits and vegetables make up 20 to 25 percent of the cafeteria/food budget for the hospitals that don’t have an FTH program Those that have an FTH program spend between 25 to 30 percent of their budget on fruits and vegetables.
Q: So it’s possible that hospitals with and without FTH programs could both be spending 25 percent of their budget on fruits and vegetables?
A: Yes. There is some level of overlap there.
Q: Were you able to pull out the percentage of local?
A: Let me give you the break down of categories. For meat it’s about 9 percent for local, for dairy 30 percent, for eggs 15 percent, for fruit 16 percent, for veggies 18 percent. These are the average overall shares of local for all the hospitals.
When we separate out hospitals with FTH programs, the share of local produce increases by 10 percent. Those hospitals that have FTH programs say 26 percent of that local produce is fruit, and about 30 percent for veggies. This is pretty much the same for those that signed the Healthy Food Pledge. One of the surprising findings is how much local produce these hospitals are buying.
Q: Did the strong local showing also correlate to those hospitals that were located in agricultural areas?
A: We found no evidence of that. That was surprising. The reason maybe is that for local produce you don’t need a lot of land. It’s not like growing corn or soybeans. Produce can be grown in high volume in a relatively small space.
Q: What other factors were statistically relevant to FTH development?
A: Let me summarize the factors that increase the likelihood that hospitals adopt FTH programs. First of all, smaller hospitals are much more likely to adopt FTH programs than larger ones. When you have a smaller operation, it’s much easier to develop relationships with the local community.
I have to tell you something important: It’s very, very unlikely that the hospital will buy directly from the farmer.
Q: So they’re buying from a distributor?
A: Yes. And the distributor is developing the local program. One of the insights is that the distributor plays a key role, and the same distributor brings the local and non-local produce and is very flexible. They try as much as they can to meet the expectations of hospital but also have access to the national system. From a logistics standpoint they can handle it better.
Q: What are main issues hospital foodservice directors pointed to in their efforts to develop an FTH program?
A: What we found is that those hospitals located adjacent to metropolitan areas are less likely to adopt an FTH program. The likelihood of a rural or urban hospital to adopt an FTH was no different; the likelihood was just the same, but those in the suburbs of the cities were less likely to adopt.
Q: Why?
A: We really did dig deep into this, and it’s true. One of the reasons when we talk to the managers is that in rural areas you’re close to farms, and in urban areas you’re close to distributors with supply logistics for both local and non local.
In between, you don’t have the same infrastructure to deliver fresh produce. These are locations that are not rural and not urban. They’re in limbo.
Another interesting finding that surprised us: We thought that hospitals that owned their foodservice operation would be more likely to have an FTH program because they’d have more flexibility. We found that some of the hospitals that contract foodservice with a third party results in the same likelihood that they’ll have an FTH program as those that do their own. We found no statistical difference, and we were looking at more than a 100 hospitals here.
Q: What accounts for that?
A: I think that in the end, if a hospital wants to adopt an FTH program and increase the amount of healthy local foods in their menu, the third party has to accommodate them or lose the business. In fact, while we can’t say it is statistically significant, we see evidence that the hospitals that have third parties running their foodservice operations are more likely to have an FTH program. The infrastructure is set and it’s easier for them. It’s not conclusive, but we see indications that this is the case, and want to do further study here.
Q: Did you garner more insight from the hospital directors on the obstacles and rewards of pursuing the FTH process?
A: Opinions in our case studies were very consistent with our survey results. We asked foodservice directors to rank the challenges and benefits. The Number One challenge was reliability of supply. Second was the cost. The directors told us it’s more expensive to procure local. The third challenge was the lack of infrastructure, which is also related to cost. Fourth was the seasonality of production, which connects back to reliability of supply. These are perceived challenges from the hospital directors.
When asked to rank the top benefits, Number One was food safety.
Q: Really? You did say “perceived”…
A: Exactly, because we know local is not necessarily safer. That was a real wow finding, and especially because it was ranked Number One. Number Two was support of the local economic environment. Number Three was quality of food, that it’s fresher. And the fourth perceived benefit was that it promoted environmental sustainability. In our survey, they had to rank each one of the factors at different levels of importance, slightly important, important… with Number One as critical.
Q: But no one said anything about the health and wellness impact for their patients… perhaps that’s just a given premise?
A: I know. In the introduction to our research, we point to how “hospitals benefit from a Farm-To-Hospital program by upholding the common mission of many hospitals to 1) promote healthy living, 2) provide a model from which patients may learn, and 3) foster a healthy food environment.”
Q: For so long, hospitals had a reputation of serving patients and visitors all kinds of processed foods and unhealthy choices…
A: Yes I remember. We recognize through the interviews and surveys that there’s been a major shift toward healthier options.
Q: Can you talk a bit more about your three in-depth cases? Did you gain any more perspective?
A: One thing we learned is that developing relationships within local food systems takes a lot of time and effort. It’s a question of developing business partnerships, and it’s not easy. It’s harder than they thought when they started the program.
Q: Did they note problems within the hospital to handle fresh produce, like the logistics/labor training issues expressed by many school administrators?
A: Basically, those that have third-party management have no problems with fresh fruits and vegetables. They did mention they had difficulty finding the particular varieties and consistency in supply. That was a limitation.
Let me read you a quote from a Milford, Connecticut, hospital dining service director: “Initial resistance from senior hospital management, changing preparation techniques and the lack of education in regard to local foods” are the greatest challenges faced by the FTH program.
We found that comment repeated by other foodservice directors. It took some effort to convince the senior management that FTH was a good idea.
Q: What advice do you have for produce industry executives who would like to get involved in this channel of distribution?
A: I think this is an interesting and important market for the produce industry. Distributors play a crucial role here. The produce industry should look at distributors that are able to have the flexibility to procure local produce for these FTH programs as well as from other regions to participate in this market channel.
We don’t study this enough.
Q: Will you be doing additional studies to build on this initial research?
A: We want to do a complete national study, but we need $1 million, if anyone would like to contribute! We want to see if what we’ve learned in the northeast region translates to other regions. We also want to identify and explore supply chain practices. That’s really the next stage. What are the best practices for hospitals to increase fresh fruits and vegetables, and what is the best combination of local and non-local produce.
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Ok, let’s understand the distinctive meaning of Farm to Hospital. Hospitals that don’t have such a program get produce that is grown on farms, distributed through distributors and then delivered to the hospital. In contrast, those hospitals that do have such a program, well, they get produce that is grown on farms, distributed through distributors and then delivered to the hospital. Hardly sounds like a dramatic departure from standard operating procedures.
There are a lot of interesting questions this study raises that will have to wait for future studies:
It would be great to do a profile of the audit status of vendors’ produce bought under a farm-to-table program rather than bought conventionally. There is not much reason to think it would be stronger and a lot of reason to think the audit profile of local vendors may be weaker.
And the really interesting question is to audit procurement documents to see how procurement changes when a hospital adopts a farm-to-hospital program. This is different from comparing hospitals that have a program to those that don’t.
Of course, a truly important study would be to study patient outcomes in hospitals that have such programs vs patient outcomes in those that don’t. These are very complex studies — after all a trauma center may have a lot of fatalities not due to poor patient care, much less poor diet, but due to the patient profile — so many adjustments must be made, but isn’t this really the point of hospital food — to encourage health? So shouldn’t we study whether we are achieving these goals?
We also would be interested in seeing how procurement splits between the commercial foodservice elements of a hospital — say the cafeterias and coffee bars that sell food — versus the food given to the patient population.
This discussion raises many of the questions we had regarding the UC Davis program, which also emphasized local. We dealt with these questions in a series of pieces including these:
Are Critics Of Local Programs Devoid Of Taste Buds?
Pundit Mailbag — Where Does ‘Affordability’ Fit Into UC Davis’ Local Decision?
Pundit Mailbag — Taste Trumps Over ‘Local’
Dissecting The Meaning Of Local, Sustainable And Flavorful
Reality Check For Locally Grown Advocates: Economics Don’t Measure Up
Everyone Is In Favor of Better Flavor But Is ‘Local’ A Solution Or An Ideology?
Tom Reardon of Michigan State University Speaks Out: Wither Local?
The jist of our argument, of course, is that it makes sense to target various attributes in line with a purchaser’s values and desires, such as to decide to buy food that is, say, better-tasting, more nutritious, less expensive, with a lower carbon footprint, etc. But deciding to buy local isn’t even a rough approximation for most of these values.
It is not surprising to us that a hospital outsourcing its foodservice would be quicker to adopt a Farm-to-Hospital program than one that does not. A hospital that contracts just adds a specification to a contract; it is the contractors’ job to work hard and make it happen. And the higher price tends to get lost in the mix, as opposed to overtly and directly buying higher priced items when one knows a less expensive option is available.
It will be interesting to see if publicly owned hospitals procure differently than privately held. Perhaps the public ones need to curry favor with rural legislators and do so by publicly identifying with buying their product.
One other point for future study: What audits are done of the distributors to make sure the “local” product actually is local? Maybe the foodservice directors aren’t getting what they think they are?
Health care is a booming consumption sector with an aging population expecting to cause growth far into the future. Turning hospitals into models for good eating behavior sounds like a worthy goal, but should the focus be on local? We have no evidence that the locally grown produce served in hospitals is distinguishable in nutrition content over produce grown 50 miles further away or, for that matter, 500 miles or 5,000 miles further away, and one of the national priorities is reducing health care costs, so how can we justify spending more money to buy local if that doesn’t improve health outcomes?
We can’t wait to hear from the case studies Professor Gómez and his fellow researchers have conducted.
You too can learn about this potentially explosive market opportunity by registering to attend The New York Produce Show and Conference right here.
Bring your spouse to our spouse/companion program here
Sign up for the Global Trade Symposium right here.
And the “Ideation Fresh” Foodservice Forum right here.
And there is an assortment of regional tours; let us know your interest here.
Looking forward to hearing Professor Gómez in New York City.
