Healthcare Design - November 2015 - 106

C CONSTRUCTION | 11.15
Delivering results

Whether reduced cost, speed to market, risk mitigation, or ownership control is the
objective, there's a delivery method out there that's right for your next healthcare
construction project By Charles H. Griffin
You're a healthcare project manager responsible for
constructing a new building in your system. To date,
you've followed the strategic plan and the master plan
and have developed a conceptual project budget.
You've secured board approval, too. Now it's time to
review and make recommendations to your leadership
on the project delivery approach. This is the legal/contractual arrangement that will define the relationships
that the hospital will have with the project delivery
team, including the design team and consultants, and
the construction team and its subcontractors.
What are your project delivery options and how do
they vary?
Contracting methods are evolving in response to
the challenges of delivering a successful, large-scale
healthcare project. Meanwhile, as the Affordable
Care Act is more clearly understood, most hospitals
are learning to work with the regulations and are
motivated by new reimbursement models to pursue
outpatient or ambulatory care sites. This trend moves
patient care away from the inpatient environment and
into smaller, less complex facilities.
Depending upon the type, scope, and scale of a
project, the delivery method of choice will vary. Further
complicating the picture, there are a variety of pros
and cons to consider within even the most successful
delivery methods.
Design-bid-build
Design-bid-build is the traditional approach: The client
hires the architecture firm, which prepares design
and construction documents. Once the design and
construction documents are complete, the contractors bid on the work based on the documents. It's
good practice to prequalify the contractors, using a
request-for-proposal process similar to that used for
architectural selection. Major subcontractors can also
be prequalified, which is wise given that MEP systems
can cost as much as 40 to 50 percent of the construction budget.
Pros:
* It's the industry's most familiar delivery method
* Roles and responsibilities for the team are well
defined
* More firms can bid on a project
* The owner can benefit from lower market pricing in
a competitive environment, and the low bid may be
the deciding factor in a selection.
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Cons:
* The lowest bid leaves little or no room for the changes
(and potential conflicts) that can be expected on
complex projects of long duration, such as a hospital
* The owner is often required to act as an issues
resolution agent when architectural documents and
construction conflict
* Relationships can be adversarial
* Owner control over the general contractor team is
limited
* Bids can be high in a tight construction market.

Contracting methods are evolving in response
to the challenges of delivering a successful,
large-scale healthcare project.
Construction manager at-risk
In the construction manager at-risk model, the owner
hires both the architect and construction manager (CM),
which is brought onto the project team during the early
design phases to assist with constructability, logistics, and estimating, providing an early opportunity for
collaboration. Under this method, the CM will define a
scope of work, construction duration, and a guaranteed
price and, by doing so, takes on the risk of the project.
With comprehensive and complete estimating, a CM
can help the team keep the project within the budget.
This requires transparency and effective communication
between the design and construction partners to be
sure that as the planning and design evolves, the CM is
responding with cost information that accurately reflects
any changes.
This method is the most common delivery method for
large-scale healthcare projects, and is especially helpful
in renovations because the CM is part of the team and
can better watch the budget and schedule goals as well
as allocate resources for unknowns that often arise.
Pros:
* Cost and change risks are more easily mitigated
* There are more opportunities for a faster construction
schedule with less risk than other methods
* Tension between project team members is reduced
* Work from project team members, excluding the CM
and architect, can be competitively bid.
Cons:
* The construction team is required to play a larger

Charles H. Griffin

http://www.HCDmagazine.com

Healthcare Design - November 2015

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