Embrace Change When Planning Medical Equipment

Part one of a three part series on how equipment planners—backed by Attainia’s powerful medical equipment planning platform—can manage change to a positive clinical and financial outcome during healthcare construction and renovation projects.

• Read part two here
• Read part three here
• Download the complete guide, Embrace Change When Planning Medical Equipment, here

The concept of change can bring about angst in any hospital construction, expansion or renovation project. And it’s no wonder– research shows that change represents an 11% impact to a construction project’s budget, on average. As for changes specific to medical equipment: that typically accounts for a full 4% of the project change. To an equipment planner who is driving toward two specific goals— completing projects on budget and on time—change may represent a significant threat:

• Change costs money.
• Change causes delays.

But while change—usually manifested in construction projects as change orders—often brings about a negative reaction within equipment planning teams, there is a critical point to consider: not all change is avoidable, and not all change is bad. Construction projects are inherently organic, dynamic endeavors that must manage both expected and unexpected changes throughout their duration. In healthcare projects: hospital business needs change; budgets change; physician preferences change; regulations change. New discounts become available. New technology launches. Time also plays a significant factor; projects that span several years will be more susceptible to change compared to projects that complete in less time.

Regardless of the nature of the change, the goal for equipment planners and project management team members remains the same: to manage change as effectively as possible to mitigate costs and project delays. And sometimes, effective change management can even lead to cost savings to the project’s medical equipment budget.

Causes of Change Orders

Change occurring throughout a hospital construction or renovation project can have wide-ranging implications to the medical equipment being planned, as well as the equipment budget. Here are the typical sources of change.

Owner or Equipment Vendor-Initiated Changes

Owner changes typically account for 88% of all equipment related change requests, and are typically initiated because of clinical staff requests. Many are based on vendor technology changes, user preference, or budget reductions. While largely unavoidable, these can be identified early, in the design or validation phase of planning, and can be managed to bring about positive change within the project. Examples include:

• A physician requests a specific piece of equipment based on their use preference
• The scope of work changes – for instance, converting additional rooms to ICU patient rooms, which would require increasing the number of ICU beds
• An upgrade to the equipment model or software becomes available
• Equipment is discontinued or recalled
• Equipment goes on backorder
• There is a delay with delivery or installation
• An organization’s contract with the supplier changes
• An organization’s equipment standards change

The goal of the equipment planning team is to identify these types of changes (when possible) early in the project, at the validation stage, when the impact of the change can be contained to simply updating the equipment list—and to bring visibility of the change to all stakeholders. When any change occurs, a variety of stakeholders will need to approve the change, understand the financial and design implications, and ensure all team members downstream are aware of the change.

Programmatic and Construction Changes

Programmatic changes are modifications to the project scope, such as a reduction in the number of operating room suites or a change in clinical service offerings. These changes typically account for 8% of the total equipment-related change requests.

If there is a design change to the structure being planned, equipment may need to be reimagined to accommodate those changes. For instance, if a door is moved, the equipment that was configured around that door may need to be changed to work within the new design.

Other external factors, like new regulations being announced, also can drive construction changes that impact equipment. In California, for example, a structure might be reviewed for compliance with seismic regulations. This could impact the physical design of a building—which could trickle down to impact the equipment.

While typically unavoidable, changes driven by construction modifications need to be managed very closely by equipment planning teams, as these types of major changes can quickly trigger changes to the labor and schedules associated with the equipment. Again, it is critical that planning teams effectively communicate the change and implications to all stakeholders (including the design team, clinical team, contractors, program managers, finance team, subcontractors, and vendors).

Contractor-Initiated Changes to the Construction Project or Schedule

Contractor changes involve structural changes that impact the placement of medical equipment. State or local regulations may dictate structural changes. Contractor-initiated changes typically account for approximately 4% of the total equipment-related change requests.

Common Causes of Change that Impact Equipment Planning

• Lack of coordination between the owner, general contractor, equipment planner and architect/MEP teams
• Specification sheets are not accurate
• Vendor specifications are out of date
• Field changes are not communicated to the equipment planner
• Schedule changes are not communicated to the equipment planner
• Equipment changes and updates are not communicated to the general contractor
• The general contractor is not using the latest equipment drawings
• The general contractor is looking at old specification sheets
• Subcontractors are not reviewing vendor equipment drawings
• Subcontractors are working from old drawings
• Equipment delivery schedule is not synced with construction schedule
• Client clinical user requests an equipment change due
  to preference
• Equipment is discontinued, or new equipment is introduced into market
• Equipment requires software updates to new versions that are not client-security approved
• Changes to regulations (i.e. OSHPD or state inspections)
• Acts of God, for instance: weather, accidents or pandemics
• A long project duration, which makes the project susceptible to the change in inventory, clinical needs, and equipment technology that occurs naturally over time
• An equipment planner is unaware of an organization’s standards and specifies off- standard equipment
• Errors are introduced by the equipment planner, such as forgetting a piece of equipment or mistyping data (if a project is managed in a spreadsheet, vs. in an equipment planning platform like Attainia)

Shifting Priorities—and Implementing Change— Due to a Pandemic

The 2020 Coronavirus pandemic posed an unexpected question to many hospital executives and equipment planners: How can we shift our project plans to be more supportive of care during a pandemic?

Many organizations have answered this question by introducing change to their project plans. Some have chosen to equip single-patient rooms in a way that the rooms could rapidly make a transition to two-patient rooms if needed to rapidly increase capacity. Others have reduced the scale of other areas, like the physical therapy department, to reallocate that budget to a pandemic-supportive care investment.

In this case, embracing change —even with additional costs incurred—allowed these hospitals to be better equipped to respond to a pandemic and provide the best patient care possible.

Cost Associated with Equipment Changes Add up Quickly

When a change order associated with medical equipment occurs, it can be difficult to assess the true cost of the change as the implications can be far and wide within a project. Sources of additional—and potentially avoidable—costs include:

• Construction costs associated with any structural changes needed to accommodate equipment changes—such as a door needs to be removed to bring in a large piece of equipment.
• Labor costs to re-work a task that has already been completed. The cost of labor may also be higher if overtime is incurred.
• Equipment return fees, including shipping, freight and penalties, if you need to send back any already-purchased equipment.
• Materials, which may increase in cost as the project progresses due to inflation.
• Loss of revenue if delays in the schedule push back a project completion date.
• The cost and time associated with design changes, including updating drawings and coordinating labor, and equipment warehousing.
• Patient safety and satisfaction. If off-standard equipment is specified, purchased and installed, this introduces a risk for errors and delays in patient care due to clinical staff being unfamiliar with the equipment. Also, if off-standard equipment needs service, it may take the biomedical team longer to service the equipment or order parts they have not stocked, potentially increasing patient wait times.

Mitigate Costs by Identifying Changes Early

Identifying changes as early in the project as possible gives equipment planners the best possible chance to mitigate costs. The further into the project a team gets, the cost of change increases exponentially, as physical structures may need to be altered and purchased equipment may need to be moved or returned.

On a typical project, a project team should aim to identify 80% to 90% of potential changes during the project’s design phases, which would mean the remaining 10% to 20% of changes would occur during the implementation and construction phases (procurement through installation). Changes implemented during the design phases would typically have less of a financial impact to the project, as compared to those implemented during the construction phase.

All changes—regardless of the project stage— need to be tracked and managed by the equipment planner. 35% to 40% of equipment changes require consultative engagement by the equipment planners to determine viability/cost/schedule impact—and these changes represent the largest opportunity to generate a positive outcome to a project.

The Importance of Process

Successfully managing change and mitigating risk to the project budget and/or timeline involves implementation of an effective change management process. It is vital that all of the project participants agree to and support the process. The key components of this process should minimally contain the following:

• A methodology to capture early detection of the change
• Change order request documentation
• An integrated system for change order communication
• A clear change order impact assessment process
• An effective change order tracking and control system
• A change dispute resolution process
• Expedient decision making and timely approval
• Equipment specifications and cost data transparency
• Approvals documented in writing (no verbal approvals)
• Accurate contingency dollars in the project budget

Ready to Learn More?

If you’re ready to hear how Attainia’s industry-leading tools can empower your teams through successful change, let’s talk.