Purpose: This article aims to complement the historical literature on the evolution of hospital buildings via a holistic analysis of the contextual factors triggering hospital design innovation over the past 100 years. Background: Innovation in hospital building design should be considered as a complex ecosystem with a heterogeneous set of actors. Methods: A novel hybrid research design to the Mixed Grounded Theory methodology, with Charmaz’s constructivist paradigm, was developed to explore, construct, and interpret concepts and the interconnections between them. Results: Six hundred seventeen interconnections between 146 factors, classified across 14 categories, were developed to explain the individual and combined impacts of all components of the design innovation ecosystem. Conclusions: This study provides hospital building designers, researchers, policy makers, and stakeholders with a systemic understanding of the innovation ecosystem and their potential role in this system. This knowledge suggests the need for interdisciplinary education to address complex and quickly evolving real-world building design problems.