When a healthcare organization thinks about a capital project, often the first thought is they want to see a beautiful rendering of the building. Rather than mentally jumping directly to the bricks and mortar solution, we suggest that a more thorough and meaningful feasibility study should be conducted first, before ever thinking about hiring an architect. The dynamics of every organization and project is different, but here is a check list of items you may want to consider as you think about a new or renovation project:
1) Assemble a building program committee composed of board members, medical staff, hospital leadership and legal counsel. Define their role, responsibility and timeline.
2) Assemble your financial performance data and patient data for the past 3-5 years as this information will be required in determining volume projections for various services.
3) Perform a debt capacity analysis.
4) Determine or validate the care delivery model. Do you maintain the approach currently in process or do you consider another model.
5) Develop financial scenarios for a worst case, moderate case and best case so the potential levels of risk are more clearly defined.
6) With the assistance of a medical space programmer, have a preliminary departmental space program (list) prepared.
7) While many organizations jump directly to building a new facility, sometimes it may be prudent to perform a “build new versus renovate scenario”. This will likely require the assistance of an architect and engineer to evaluate the existing facility.
8) Assemble a preliminary capital budget, preliminary project development schedule and cash flow projections.
9) Evaluate financing alternatives.
10) Consider reviewing your initial strategy with the local authorities, in case it requires rezoning, street closure, etc.
11) Once a go/no go decision is determined, then you can proceed with a preliminary design phase; if the decision is to proceed.