'Major risks' to hospital, document shows

Will the new Dunedin hospital meet the health needs of the local community and wider region?...
Will the new Dunedin hospital meet the health needs of the local community and wider region? PHOTO: PETER MCINTOSH
Te Whatu Ora Southern staff believe "significant overarching risks" remain to the cost and function of the new Dunedin hospital, a newly released document reveals.

A memorandum titled Response to presentation of Value Management Option 4.5 provided to the Otago Daily Times by Te Whatu Ora Health New Zealand (HNZ) under the Official Information Act, shows concern was voiced about the new design in early November.

HNZ said robust conversations had been held and the current hospital plan approved in December — Option 4.5a — was refined to address concerns, but did not specify how.

Some issues raised have not been changed, including the risk posed by fewer beds, operating theatres and workspaces, and the decision not to install a PET scanner on opening.

The memorandum shows the response of three senior staff members to design changes made to address concerns about the much-criticised earlier proposal, Option 4.3.

The various proposals were put forward to address a predicted $200 million cost overshoot, before the Government approved $90 million worth of cutbacks under the current option, in addition to $110 million in additional funding.

Southern’s response to the earlier design, leaked to the ODT last year, criticised multiple aspects of the changes made to the Detailed Business Case of the new hospital, concluding that any alteration was likely to result in poorer outcomes.

The newly-released memorandum thanked the design team for responding to Southern’s concerns and said "significant mitigations" had been presented in the new design, but also detailed multiple problems that remained unaddressed.

"Southern considers that those significant overarching risks to programme, cost and functionality remain, regardless of whether we see Option 4.5 or 4.3," it stated.

The proposed shelling of 1000msq of supplied workspace was "not considered clinically workable", despite the potential for it to be activated in future.

The loss of two operating theatres was also listed as a risk.

Also raised were problems incorporating logistics into the inpatient building, the clinical workspace reduction of 6.4% and concerns about the dairy building’s suitability for workspace use given its distance from clinical areas.

Achieving the redesign in the proposed programme timeframe was also a risk.

Potential knock-on effects were expected to become apparent as design progressed.

The reinstatement of 12 mental health services for older people (MHSOP) beds was listed as a welcome change, as the earlier redesign proposed to delete them.

The proposed reduction of 35 medical/surgical beds had been reduced to a loss of three beds on opening.

However, this still left a reduction of nine MHSOP and three medical/surgical beds on opening, compared to what was outlined in the Detailed Business Case.

"There remain the risks that the predicted growth in demand for MHSOP may not be able to be accommodated without further expenditure, and that detailed work on a suitable model of care (including primary and community-based services) is yet to be completed."

Shell space for a PET scanner to be installed in the future also provided "some mitigation", but this transferred the cost of instalment to Te Whatu Ora Southern, the memorandum said.

Outsourcing volumes would continue past the opening of the new inpatient building.

About one third of the memorandum was redacted.

HNZ delivery, infrastructure and investment director Monique Fouwler said the new hospital project team was made up of local and national staff, and robust conversations were held as the value management exercise was completed.

Option 4.5a was simply a further development of Option 4.5, refined to reduce risk and address previous concerns, she said.

"These changes will not impact the delivery of health services now and will meet the health needs of the local community and wider region in the future.

"We have strong risk management processes in place and Te Whatu Ora remains committed to ensuring Dunedin will receive a fit-for-purpose, state- of-the-art facility."