Cost overruns caused by the increased cost of building materials and design alterations have hit the ambitious expansion project at New Hanover Regional Medical Center.
Hospital officials will cut back on some components of the project as a result, including the expansion and renovation of the emergency and imaging departments.
Following a public hearing held Jan. 9 at Cape Fear Community College, a state agency is considering approval of the cost overrun application for the master facility expansion and renovation at New Hanover Regional.
The Certificate of Need Section of the N.C. Division of Health Service Regulation would issue the approval by late April.
The state approved the $204 million project in its original form in December 2006. The revised plan requested by the hospital calls for an additional expense of $45 million, for a total project cost of
$249 million.
“What has prompted it is the unprecedented rise in the cost of (construction) materials. It has made a lot of changes in the cost of the project,” hospital spokeswoman Martha Harlan said.
Projects that exceed 15 percent of the initial estimate must go through the cost overrun application process, said Tanya Rupp, a project analyst in the Certificate of Need Section of the N.C. Division of Health Regulation.
A public written comment period ended Dec. 31.
The master plan approved in 2006 includes the renovation of the patient tower, emergency and imaging departments and The Coastal Heart Center.
The plan also included construction of a Surgery Pavilion and the Betty H. Cameron Women’s and Children’s Hospital, both of which opened in 2008. Additional funds were earmarked to upgrade the hospital’s central heating and
cooling plant.
Work on the patient tower is ongoing. The ninth and 10th floors of the tower have been gutted for renovation, and the eighth floor is an open area. Crews will gradually work their way down from there.
To compensate for the cost overrun, hospital officials propose delaying indefinitely the expansion and renovation of the emergency and imaging departments and The Coastal Heart Center, all located on the first floor of the patient tower on the hospital’s main campus.
Additional project costs prompted design changes that will expand the Surgical Pavilion to include 44,000 feet of unfinished space to keep egress paths and necessary connections in place, according to the state.
Harlan said money is on hand to offset the additional $45 million project cost.
“It’s my understanding we
do have the funds available
from bonds, operations and
philanthropy,” she said.