Hospital project $14 million over budget
By Steve Herring
Published in News on March 28, 2018 10:23 AM
File photo
Higher construction costs and additions to a project to expand and renovate surgical and endoscopy space at Wayne UNC Health Care have pushed the project to 24 percent over budget.
The project, originally budgeted for slightly more than $34 million, is now expected to cost just under $48 million.
The hospital's initial certificate of need allowed for it to spend 15 percent above the original projected cost, said Melissa Shay, vice president of strategy and business development at Wayne UNC Health Care.
Wayne UNC Health Care has taken out variable rate bonds through the North Carolina Medical Care Commission to pay for the project, which is scheduled for completion in late summer of 2019.
The cost of the surgery center will not impact hospital fees, Shay said.
"You have to refile if you are expected to go over and above the 15 percent they allow," she said.
A public hearing for a new certificate of need to reflect the new cost will be held at 10 a.m. Friday, April 13, in the Wayne County Public Library's Gertrude Weil Auditorium, 1001 E. Ash St.
State law prohibits health care providers from "acquiring, replacing, or adding to their facilities and equipment, except in specified circumstances, without the prior approval of the Department of Health and Human Services."
Prior approval is also required before certain medical services can begin.
The intent of a certificate of need is to restrict "unnecessary increases in health care costs and limits unnecessary health services and facilities based on geographic, demographic and economic considerations."
The project is over the initially approved amount because of several factors, including an increased price per square foot, addition of an electrical hub and increased technology expenses, Shay said.
"More specifically, the final price per square foot has increased by $73 due in part to additional electrical and infrastructure requirements," she said. "The addition of an electrical hub is necessary in order to meet the increased electrical demands the new surgery center will place on the system as well as allow for future growth.
"The increase in technology costs is due to the expanded implementation of integrated digital surgical suites to all of the operating rooms. IDSS are high definition video routing and display solutions for surgical environments that are designed to enhance visualization and collaboration in the operating room."
This advanced technology is found across the country in state-of-the-art operating rooms to enhance safety and quality of care, Shay said.
"The electrical hub was not included in the original design," Shay said. "This was added after the team determined the amount of electrical that would be needed with the new center, as well as allow for future growth.
"The additional electrical and infrastructure was not an oversight, it was not in sight when the project was planned."
The original certificate of need was filed in June 2015, for just more than $34 million based on the schematic design provided by the architectural firm.
Pricing for the certificate of need was based on 2014 construction and technology costs, Shay said.
The project is on schedule to take the two and half years that was originally planned, she said.
"The team took additional time in the planning phase in order to involve all key stakeholders in the design process to ensure a thoughtful plan that took into account patient experience, operational efficiency and advanced technology," Shay said.
"The new surgery center was designed in order to improve the patient experience, as well as, give our doctors and clinicians access to advanced technology in an efficient environment. If the certificate of need is refused, we will consider alternatives that will enable us to continue fulfilling these objectives."
Anyone may file written comments concerning the new certificate of need proposal. Comments must be received by the Healthcare Planning and Certificate of Need Section no later than 5:30 p.m. on Monday, April 2.
Comments may be submitted as an attachment to an email if they are sent to DHSR.CON.Comments@dhhs.nc.gov.
Comments may also be mailed to the following address: Healthcare Planning and Certificate of Need Section Division of Health Service Regulation, 2704 Mail Service Center, Raleigh, NC 27699-2704.
For more information, contact Bernetta Thorne-Williams, project analyst, Healthcare Planning and Certificate of Need Section, at 919-855-4665 or send email to bernetta.williams@dhhs.nc.gov.