Digby Christian

The Sutter Medical Center Castro Valley project has been recognized throughout the construction industry as a unique project in design and approach, catching the interest of architects and builders throughout the world. We sat down with Digby Christian, Sutter Health Project Manager, for a closer look at what makes this project unique.

Q. Why is this project different than other projects you and the team members have been involved in?

One of the unique features of the project team is that we have an 11-party contract, with the non-owner members putting all of their profit at risk. I’m very confident that’s a unique set-up in the United States.

Another unique feature is that the trade contractors involved in the design and construction of the new hospital have a goal of achieving a fully coordinated, constructable, affordable design, complete with fabrication drawings, before the facility is even built. We do not want to resolve issues in the field during construction. We want to resolve them all as part of completing the design rather than in the field during construction when change orders are costly and time-consuming.

Q. There is a lot of emphasis on the team approach to this project. Who participates in the regular project team meetings?  How do they work together?

The Project Team is managed by a six-member team called the Core Group. I’m on it representing Sutter Health, as is Bryan Daylor, Eden’s Vice President of Ancillary & Support Services, representing Eden Medical Center. The other four members are from DPR Construction (general contractor), Capital Engineering (mechanical and plumbing design), Devenney Group (architectural design), and J.W. McClenahan (plumbing). We meet every two weeks to ensure the project is managing all the risks as optimally as possible. All decisions are required to be unanimous, and for the two years that we’ve been meeting, we have met that requirement.

A much larger group comprising all the designers, builders and specialty consultants meets at least every two weeks to resolve any strategic issues affecting the whole project. There are also subgroups that meet almost daily to keep information flowing fast and efficiently through the project team.

What are the benefits of this team approach?

You get a fully informed designed. You get an efficient plan for construction. But the main thing you gain is certainty about scope, cost and completion date.  These large projects traditionally go a long way over budget and finish very late and with compromises to the goals that the owner had. We worked hand in glove with each other for close to 18 months to get the cost of the project down without altering any of the goals for the building, and now for at least a year I have been completely confident of our ability to get the triple victory of on budget, on time, and with all the goals intact. That’s a tremendous difference from traditional delivery of these complex, expensive, long duration projects.

What have you learned by this approach?

That it works. To make it work requires that a very large team of people works very hard all day, every day for years. But if the owner’s goals are clear, and the team is working under a contract that puts their interests completely in alignment with the owner’s interests, that that monumental level of effort is exactly what you can get out of a team.  Hospital construction in California is some of the most complex, most strictly regulated, construction in the world and it is extraordinarily unforgiving of oversights and errors. To deliver a hospital on time, on budget with no compromises to what the owner and community want is about as ambitious as it gets in construction at this stage in our industry’s evolution.

How has this changed construction projects for the system? For the industry?

It’s been a tremendous proof of concept for how Sutter Health would like to deliver its projects.  And because the project has been written about in various trade publications and has now won two awards for its delivery model, it does have the potential to be a game-changing project in the industry. I would like it to be just that. Our modern society deserves a rock-solid reliable delivery method for these critical facilities, and until now, in my opinion it has not had that.

If you have any questions for Digby or any member of the team, please feel free to let us know or send us your comments.

by George Bischalaney
President & CEO, Eden Medical Center

National health care reform is now apparently right around the corner. After years of discussion, and more recently, weeks of debate in the House of Representatives, legislative action is now in the hands of the Senate. If enacted, it will be the most significant health care legislation in decades.

As a provider, it is both welcomed and feared. Welcomed in that it will help bring insurance to millions of people for whom it is now out of reach. In making this possible, it creates the possibility of opening doors for routine health care services that should help prevent late diagnosis of disease, which becomes problematic and costly to treat. From our perspective as a hospital provider, better access should redirect many people who use our emergency departments as their primary care providers.

But change comes with a cost. The mind-numbing price tag of reform is expected to be offset by future savings. In the short term, it will require shifting payments currently dedicated to the Medicare program.

Most hospital providers do not make a profit in caring for Medicare patients overall. There is no doubt that we need to drive inefficiencies out of the health care system in order to help address this issue. But that alone may not do it. When costs are rising at a rate of 4-8 percent per year and reimbursement is 3 percent or less, we are constantly falling behind. There are many reasons for escalating costs. Consider the constant introduction of new drugs, high tech and high-cost diagnostic and therapeutic equipment, and of course labor. Health care is a service business and 60% of hospital costs can be tied to salaries and benefits. The cost escalation of these items alone will keep us chasing the elusive break-even point. And once there, if achieved, there is still ongoing capital investment that is necessary to maintain the capabilities expected of community hospitals.

The final package is likely still months away. Even then, it will take time to analyze and truly understand the effects, positive and negative, of this landmark movement. We hope that the final outcome will have the proper balance, consider as much as possible all the consequences, and result in a healthier and more stable provider system.

I welcome your feedback.

George Bischalaney, President and CEO, Eden Medical Center

By George Bischalaney, President & CEO, Eden Medical Center

Health care reform is on the agenda, again. The stakes are high, but our President is determined to make some significant changes. As the discussion moves from general to specifics, special interests are staking out their positions. None of the stakeholders—hospitals included—wants to feel the impact or be at a disadvantage.

Amidst the demand for cost reduction and health care coverage for all, there is and must be continued investment in care. Physicians demand it. They expect to be able to practice with state-of-the-art equipment and facilities to produce outcomes that meet national, state and local quality standards. Patients demand it. They want to know that their local hospital has the right number of well-trained staff as well as the latest diagnostic and treatment equipment, and contemporary facilities.

With this backdrop of conflicting needs, Eden Medical Center is about to begin a three-year project that will result in the replacement of the Castro Valley hospital. The project cost is estimated to be $320 million. The current 55-year-old building is anything but contemporary. With few private rooms, small operating rooms and inadequate support space for clinical services, a new hospital is very much needed.

Eden Medical Center has served the community well, but it was not designed for patient comfort and needs, more for staff needs and functionality. While our project may seem ill timed given the uncertainty of hospital reimbursement, we are required to meet California legislated standards for seismic safety in hospitals. And it truly is needed.

We’ll celebrate our long sought goal with a ground-breaking ceremony on July 1st. Then we’ll spend the next three years continuing the investment in the new buildings and equipment, while observing and hoping that decision makers do not enact legislation that essentially penalizes us for the commitment we are making. When we celebrate the grand opening and our new beginning early in 2013, it should be with the same hope and dreams as those who celebrated the first ceremony in 1954.

By Cassandra Clark, Project Communications Director

To follow up on the May 12, 2009 Alameda County Board of Supervisors meeting, the decision to certify the final Environmental Impact Report (EIR) has been delayed to June 9th to address concerns raised about San Leandro Hospital, which is leased and operated as part of Eden Medical Center, but owned by the Eden Township Healthcare District (the District).  For more information, please see our previous blog post.

In the days prior to the May 12th meeting, after many rounds of public commentary, and after the EIR and related land use entitlements were approved by the Castro Valley MAC (Municipal Advisory Council) and the Alameda County Planning Commission, several community members and labor representatives raised last minute concerns about parts of the EIR. Those opposed to the EIR certification claim that there was not an adequate assessment of the impact of any possible closure or change of services at San Leandro Hospital, despite the fact that the EIR consultant and County planning staff have stated that the EIR is complete and the issues around San Leandro Hospital, while not related to the project, have no impact on the project. Supervisor Nate Miley made a motion for the Board to meet again to make the decision on June 9, 2009, which would provide attorneys for Alameda County an opportunity to examine these claims in more detail.

Supervisors Miley and Haggerty voiced their concerns about speakers making false or misleading allegations as a political tactic, in order to delay the EIR approval process, thereby “holding the Sutter Medical Center Castro Valley project for ransom,” which he and the other Supervisors warned could endanger the future of both Eden and San Leandro Hospitals. While there has been no decision by Sutter Health or the District on the future of San Leandro Hospital, the issue remains a topic of community discussion.

Eden Medical Center President & CEO George Bischalaney and other Sutter and Eden project team members emphasized the urgency of not going beyond June 9th to approve the EIR, as the delay of even a month could significantly hold up construction and may cause Sutter Health to withdraw its support from both hospitals. Sutter Health has already promised the $320 million to pay for the completion of the new Sutter Medical Center Castro Valley.

At the conclusion of the May 12th meeting, the four Supervisors present, with Supervisor Keith Carson absent, voiced their support for the new hospital project and the need to rebuild Eden Medical Center. They also are concerned about the future of San Leandro Hospital, and that concerns over San Leandro should perhaps be discussed in another forum, unrelated to the land use entitlements for Eden.

As our project team discussed in previous articles and blog posts and at the hearing, any delays in approvals and construction have serious repercussions, in terms of meeting state deadlines to rebuild, in creating a safe environment for patients and staff, and in funding this major project. The new hospital must be rebuilt, or it will close as an acute care facility effective January 1, 2013. We now have before us a fully funded hospital project—without public funding or taxes—that will secure the future of Eden Medical Center, preserve jobs and bring nearly 1,000 construction jobs to the region at a time when the economy is depressed and construction is drying up.

As I stated before, the issues around San Leandro Hospital are complex and important.  The community has a right to know what is happening. But the information being discussed now is no different that it has been for the past several years: the hospital is struggling and must be reinvented to bring value to the community and ensure that it can sustain itself over time.  It is clear to me that the residents of San Leandro desire a full service community hospital, yet the majority of them will never use it. The community and local elected officials have known that this is a concern, and yet this last minute effort to stop the EIR based on what some claim to be “new information” is not justified. San Leandro Hospital, its employees, physicians and patients need to be part of the solution for the hospital, to be discussed in its own forum with regional providers who can bring truth and substance to the discussion.  It should not be used as a political maneuver to stop Sutter Health from rebuilding Eden.

Please speak up, let our Board of Supervisors know they must not delay any further.  These delays put both hospitals in jeopardy. I encourage you to stand up and let your voice be heard on this issue.  Don’t just wait for the next hearing, but instead pick up the phone or send a letter to the Board and let them know you support the new hospital project, and encourage them to certify the EIR so the project can move forward before it’s too late.

Call today!

Supervisor Nate Miley — 510-272-6694

Supervisor Alice Lai-Bitker — 510-272-6693

Supervisor Gail Steele — 510-272-6692

Supervisor Keith Carson — 510-272-6695

Supervisor Scott Haggerty — 510-272-6691

By Cassandra Clark, Project Communications Director

YOUR HELP IS NEEDED!

We are only a week away from the Alameda County Board of Supervisors hearing in which the Board will consider the Final Environmental Impact Report, zoning changes, and Castro Valley general plan changes. We are asking for your support at this critical step.

Local groups and some residents of San Leandro are applying fierce political pressure on the Board members to deny approval. Their reason? The future of San Leandro Hospital is unknown, and therefore they are pressuring the Board of Supervisors to require Sutter Health to keep San Leandro Hospital open as a condition of approving the land use for the new hospital in Castro Valley.

What wrong with this?  First of all, the Board of Supervisors are not voting on the future of San Leandro Hospital—they are having a public hearing on the land use entitlements and certifying the EIR. To delay or deny approval based on pressure about San Leandro is wrong.

The future of San Leandro Hospital is not and should not be tied to the new hospital. Indeed, San Leandro Hospital is a critical issue that must be addressed—and it requires a regional solution, more careful planning, and a separate focus than this project.  It’s an important issue that cannot be overlooked, for the sake of the staff, physicians and patients. But the complex issues at one hospital should not be tied to the land use entitlements for the new hospital project.

Simply stated, by delaying plans for the new hospital, the Board will jeopardize the future of Eden AND San Leandro hospitals.

I am asking you to attend the Board of Supervisors meeting on May 12 and SPEAK UP in favor of our new hospital. Speakers are limited to 3 minutes, but a simple 30-second statement is powerful. The Board needs to know that residents of Castro Valley and surrounding communities want and need this new hospital, without delays.

Meeting details:

Tuesday, May 12
1:00 p.m.
Board of Supervisors Meeting Chambers
1221 Oak Street, Oakland

If you cannot attend the meeting, we need to you to contact the Alameda County Board of Supervisors and have you voice your opinion. It is so important that the Board hears from everyone, especially since the majority of people in our community support this project (an astounding 80% of community members are in favor according to recent polls!).

Call your Supervisors today!

Supervisor Nate Miley — 510-272-6694

Supervisor Alice Lai-Bitker — 510-272-6693

Supervisor Gail Steele — 510-272-6692

Supervisor Keith Carson — 510-272-6695

Supervisor Scott Haggerty — 510-272-6691

Thank you for your continued support!

As always, we also appreciate your comments and questions on this blog, and we’ll respond as quickly as possible.

The new Sutter Medical Center Castro Valley, which will replace Eden Hospital.