Searching for a Better Way to Build Big Veterans' Hospitals
With millions of veterans in need of care, the U.S. Dept. of Veterans Affairs (VA) could have been forgiven the inevitable slipups in building out its already big portfolio of hospitals, clinics and treatment facilities.
In the past two years, as differences with contractors on big medical centers in Aurora, Colo., and Orlando, Fla., have spun into noisy feuds, recriminations have replaced understanding.
Should Congress respond by taking control of big medical-center construction away from the VA?
Some legislators already are trying to get it done.
Rep. Mike Coffman (R-Colo.), a veteran's-affairs committee member whose district includes Aurora, says the VA should stick to health care and wants to call in the U.S. Army Corps of Engineers to manage building. The veterans' agency has been formally and gradually working more closely with the Corps since 2007.
The problems at the VA are reminiscent of difficulties faced over the years by other federal agencies. The US Dept. of Energy oversees hazardous- and nuclear-waste cleanup projects that have dragged on for years. The US General Services Administration has experienced a number of misadventures building new federal courthouse complexes.
On these projects, scopes often have proved hard to pin down, and the costs to complete end in guesswork and, eventually, claims.
"Cost and schedule overruns on federal construction projects are not isolated to the VA," wrote Mia Steinle, an investigator for the Project on Government Oversight, a watchdog organization, in a blog post last year.
Congressman: Call in the Corps
Coffman believes the Corps is more suited to managing the task. "The core responsibility of the VA," Coffman said in a statement, "is to deliver the health care and the benefits that our men and women who have served in the military have earned through their sacrifices in defense of our country."
Another idea is to require the Corps to place a project manager on each VA hospital center or other big project.
But a top Corps official says that isn't a formula for success.
"We know that's not an effective way for us to operate—for the VA or the Corps," says Lloyd Caldwell, Corps director of military programs. "The success of major-complex projects depends on the entire enterprise and capacity and leadership, not one or two individuals."
Aurora and Orlando are two of four new VA hospitals, with facilities also in Las Vegas and New Orleans. The U.S. Government Accountability Office last year reported that the total estimated costs of the projects had risen between 80% and 144%, and that completion dates had extended time frames, ranging from 14 to 74 months.
Of course, GAO's job is to monitor, and its 2013 report doesn't say specifically where early budget and schedule baselines were driven up by scope changes. Of 26 recently completed major medical-facility projects included in the GAO review, 13 had either come in on or below budget.
So, the issue boils down to whether the VA is a competent builder capable of learning from its errors.
Judged by its conflict on the Aurora project with Kiewit-Turner, a powerhouse prime joint-venture contractor, the VA looks bad.
The project was bid as an integrated design-and-construct (IDc) contract, similar to construction-manager-at-risk. It established separate contracts for the contractor and the designers, with the intention of bringing the former into the design process early to help manage costs.
It is the first time the VA has attempted to use the IDc delivery process.