Hospitals taking on new construction or renovation projects employ architects and design professionals to guide the process. For both the hospital and the design firm, their top priorities are completing the project on time and under budget, as well as creating a productive and efficient asset that meets the needs of staff and patients effectively years down the road. Given the complexities in construction projects, meeting these priorities is not easy.
To bridge potential gaps in communication, expectations and functionality of the finished space with the various stakeholders, hospitals are increasingly leveraging industry expertise and resources of construction advisors and equipment planners. This can also potentially generate cost savings on materials and capital equipment.
“When involved at the outset of a project, these expert partners can offer insights that create standardization opportunities for materials and equipment, and opportunities to leverage group purchasing contracts that result in significant cost savings,” said Theresa Brigden, LEED AP, associate principal, capital and construction advisory solutions at Vizient.
Providing expertise to enhance strategy
Much like the first stroke of an architect’s pen, the first step in constructing a new facility or renovation is to identify what issue or need they want to address and how that will increase revenue and improve patient experience.
“Project goals and an operational strategy must be identified at the start,” Brigden said. “An experienced construction advisor provides value by offering options to enhance and execute that strategy, such as identifying cost reduction opportunities through contract utilization.”
The next step is securing leadership buy-in, as well as gaining the support of key stakeholders
“Having a construction advisor on the hospital’s team is incredibly valuable. They have the construction background and ‘speak the language’ of architects and general contractors. They can clearly articulate what the hospital’s unique long-term goals and expectations for the building are,” Brigden said. But the value the construction advisor brings doesn’t stop there.
Once construction starts, the general contractor hires subcontractors who buy the raw materials. The subcontractor often has no idea that the hospital’s construction advisor can leverage contracts to obtain better pricing on materials. For example, the advisor might know of a lower price point on paint because it’s on contract.
“A primary responsibility of the advisor is to help the hospital negotiate best pricing,” Brigden said. “If somebody isn’t connecting the dots and enabling the subcontractors and vendors to obtain best pricing by utilizing GPO contracts, the hospital won’t receive maximum benefit.”
In other cases, the advisor might suggest that the hospital procurement team directly purchase the materials. This can lead to a reduction in mark-up costs, generation of sales tax savings, increase in negotiating power and the ability to lock in pricing for necessary enterprise-wide materials that could be utilized on multiple projects.
“An effective construction advisor will work with the hospital to create solid RFPs, bid packages and contracts to ensure that direct purchase risk is minimal to none,” Brigden said.
Configuring optimal designs for medical equipment
Many construction projects include capital equipment purchases. Much like construction projects, medical equipment planning and purchases require an expert advisor’s early involvement to help ensure the hospital gets the best price.
“The hospital’s design team needs information regarding equipment very early in the project to incorporate mechanical, electrical and plumbing requirements into the schematic design,” said Rodney Cadwell, associate principal, capital and construction advisory solutions at Vizient. “An equipment planner can work in concert with architects, hospital leadership and end users, e.g. radiologist, to appropriately set budgets, participate in space planning and potentially offer alternative solutions that may improve operations and provide cost savings.”
To identify cost saving opportunities, an equipment planner should be involved in the planning phase to identify optimal contract pricing where applicable, rather than waiting to the point of procurement.
“There are questions that typically surface in the conceptual design phase that must be answered,” Cadwell said. “This discussion helps uncover any potential issues that could arise during installation and develops a solution to address them.”
Common areas of discussion include:
- Defining current equipment standards and investigating alternatives that may be more cost effective or operationally prudent
- Determining budget parameters and identifying existing equipment that could be utilized or repurposed
- Agreeing upon a design and implementation schedule and identifying installation professionals
“The equipment planner’s primary role is to bridge communication of these details between all stakeholders, including end users, clinical engineering, supply chain, IT, hospital leadership, and the design and installation teams,” Cadwell said.
Aligning with the right partner
Brigden and Cadwell oversee capital and construction advisors who possess extensive industry experience to help members produce a long-term quality result.
“Our equipment planners and project professionals manage numerous diverse projects and medical equipment purchases on many levels,” Cadwell said. “We utilize technology and software specifically geared to capital equipment project management and capital process improvement.”
“With extensive backgrounds in architecture, engineering and construction, our advisors have supported member initiatives ranging from $1 million to $1 billion in construction value,” Brigden added. “We have saved them millions of dollars not only on project planning and execution, but future maintenance and operations.”
For more on how Vizient can help your organization plan and execute an upcoming capital or construction project, click here.