SOUTHERN PARTNERSHIP GROUP Dunedin Hospital Redevelopment Overview and Stage 1 Project Brief Sign Off This document requires the following approvals: Southern Partnership Group Approved SPG 10 Nov 2015> Author Document Location Status Kieran Reilly Lotus Notes Capital and Operating/ Capital Project Dunedin/ Key Documents Final
Version History Version Date Summary of Changes 1.0 11/11/2015 Approved by SPG at their 10 Nov 2015 meeting Document Consultation The following stakeholders (internal or external) have been consulted with regarding the content of this document. Name Organisation/ Role Date Southern Steering Group MoH and Southern DHB joint group 3 Nov 2015 Southern Partnership Group Governance 10 Nov 2015 Confidentiality The information contained in this document is proprietary to the Southern Partnership Group. This document must not be used, reproduced, or disclosed to others except employees of the recipient of this document who have the need to know for the purposes of this assignment. Prior to such disclosure, the recipient of this document must obtain the agreement of such employees or other parties to receive and use such information as proprietary and confidential and subject to non-disclosure on the same conditions as set out above. The recipient by retaining and using this document agrees to the above restrictions and shall protect the document and information contained in it from loss, theft and misuse.
1) Purpose of this Document The purpose of this project brief is to provide an overview of Stage 1 of the project and seeks agreement, at a high level, on how the work will be managed. 2) Project Overview a) Project objectives The main objective for Stage One is to prepare a Strategic Assessment and Indicative Business Case that will provide an early indication of the best way forward to address issues with the facilities at the Dunedin Hospital campus. b) Context and Background A number of buildings on the Southern District Health Board s 1 Dunedin Hospital Campus site are not considered economically viable for relifing including the Children s Pavilion Building (built 1945), the Psychiatric Services Building (built 1935), the Fraser Building (built 1940) and the Clinical Services Building (built 1960s). Recent urgent maintenance issues with the existing facilities include the water tightness of the Clinical Services Building and a required roof replacement for the Fraser Building. For instance the Clinical Service Building s does not meet the standards for electrical wiring and protection of patient treatment areas (cardiac Protected Status ASNZ 3003:2011), nor for infection control and management of dirty laundry. In 2014, Dunedin Hospital lost its College of Intensive Care Medicine accreditation for specialist training. And in October 2015 the pathology lab and mortuary were closed due to asbestos with a cleanup also required in other areas of the building. Southern DHB commissioned Chow Hill & Sapere to develop a Service and Facilities Strategy for Dunedin Hospital facilities which it completed in March 2014. Southern DHB also recently completed development of a whole of health, system-wide Southern Strategic Health Plan 2015-2025. It is mandatory that all major capital projects follow the standards and processes required by the Better Business Cases Model 2 (BBC). The Southern Partnership Group (SPG) has been commissioned to govern the redevelopment of hospital facilities for Southern District Health Board Dunedin including $11.5M of urgent interim works at the Dunedin and Wakari hospital campuses that was recently approved. The interim works include changes to the Gastroenterology and Audiology facilities as well as a programme of deferred maintenance. A further xxxx has been reserved in the Health Capital Envelope for redevelopment of the Dunedin Hospital Intensive Care Unit subject to 1 Southern DHB was created in 2010 as the result of a merger of Southland DHB and Otago DHB and employs approximately 4,500 staff. The DHB provides health services to a population of over 313,000 people (2015/16 estimate) who live in their catchment area which includes Invercargill City, Queenstown - Lakes District, Gore, rural Southland, Clutha, Central Otago, Maniototo, Waitaki District and Dunedin City. 2 BBC guidance is mandatory for all capital expenditure, lease and asset disposal proposal undertaken by Government Departments or Crown entities that require Cabinet approval (Cabinet Office Circular CO (10) 2:Capital Asset Management in Departments and Crown Entities Redevelopment of Dunedin Hospital Project Brief Stage 1 3
Southern DHB developing an Implementation Business Case that is approved by the Capital Investment Committee. Southern DHB will not be able to fund any of the capital development. A $300M potential capital cost has been signalled in the DHB s capital intentions for this project. Based on other rebuilds this project is expected to take 7-10 years to complete. 3) Reasons for this Project a) Mandate The Ministers of Health and Finance have approved the formation of the Southern Partnership Group to oversee the redevelopment of Dunedin Hospital (HR20141648). The Ministers of Health and Finance (HR20151391) also approved the urgent interim works including the redevelopment of the Gastroenterology and Audiology facilities and a programme of deferred maintenance. 3 These works and any additional approved capital projects for Southern DHB in Dunedin will be subject to the oversight of the Southern Partnership Group to ensure they align with the overall redevelopment. For Stage 1 of the project the Ministry of Health holds legal authority for any contracts. b) Project Drivers and Rational The Better Business Case process is focused on being smarter about how we invest for change as well as deliver better services and better outcomes for New Zealanders. It is based on robust planning, analysis, decision making, implementation and review. Strategies to manage expected growth, service changes, whole of service alignment and financial viability will need to be fully explored and agreed prior to approval of any capital works. The health partnership group model has elsewhere proved to be an effective and successful mechanism for ensuring that the business cases developed are robust, the outcomes are appropriate to the needs of the local population and that the options being put forward provide best value for public money. c) Key Benefits The key outcomes and benefits of this project will be covered in detail as part of producing the Strategic Assessment and Initial Business Case. 3 Gastroenterology - a redevelopment on Level 8 of the south wing of the Ward Block. The Audiology service will relocate to the Wakari campus. Redevelopment of Dunedin Hospital Project Brief Stage 1 4
4) Project Deliverables and Approach a) Project Scope The following table delineates the scope of this project. In Scope Determining the pathway forward to address issues with the facilities at the Dunedin Hospital campus. Progress reports to SPG on the approved urgent interim works at the Dunedin and Wakari campuses and any other relevant capital works Review of an Implementation Business Case for the Dunedin Hospital ICU and any subsequent progress reports Completing the requirements for Health Capital Approvals (based on the Better Business Case Model) and production of key documentation Development of a financial model for Southern DHB with a focus on hospital services RFPs for undertaking the Strategic Assessment and Indicative Business Cases Project Assurance Out of Scope (but has linkages to) Implementation of the Southern Strategic Health Plan The University of Otago s master site plan Health Reports and Cabinet papers (MoH/ Treasury) Southern DHB operational arrangements for the urgent interim works and ICU redevelopment (e.g. projects and internal steering groups) Processes related to CIC and the signoff processes required by Cabinet and the Ministers of Health and Finance. Regional Service Planning b) Project Approach The project approach is based on the requirements of the Better Business Cases Model. Appendix One summarises how the Better Business Case Model is applied to Health Capital Business Cases. A core team of Southern DHB and Ministry of Health staff will work in partnership to support the project. Consultants will be used, either where suitable expertise is not available or as required as part of the business case process. Redevelopment of Dunedin Hospital Project Brief Stage 1 5
c) High-Level Milestones and Deliverables Within the above scope, the initial timelines for the Stage 1 are listed. A more detailed project schedule will be developed as the RFPs are completed. # High-Level Milestone or Deliverable Target Date A Stage 1 Strategic Planning Phase 1. Completing a Risk Profile Assessment RPA (BBC) December 2015 2. Review the current site Masterplan December 2015 3. RFP for health planners and business case writers to support development of the Strategic Service Plan, Strategic Assessment and Service Plan 4. Appoint contractor to develop a financial model for Southern DHB December 2015 February 2016 5. Complete financial model for Southern DHB April 2016 6. Draft Strategic Service Plan for Southern DHB April 2016 7. Finalise the Strategic Assessment document covering the case for change June 2016 8. Finalise the Strategic Service Plan June 2016 9. Produce a Detailed Services Plan June 2016 B Proposal phase 10. RFP for Health Design Team to work on Indicative Business Case (commencing June 2016) April 2016 11. Finalise the Detailed Service Plan 4 March 2017 12. Update the Masterplan April 2017 13. Draft Indicative Business Case document produced for review April 2017 14. Define the Models of Care May 2017 15. Feasibility Study (Facility options) June 2017 16. Finalise the Indicative Business Case document June 2017 The timeframes for the remaining steps of the project have yet to be confirmed and will be detailed in project plans for Stage 2 and 3. The steps are: a) Developing the Detailed Business Case b) Developing an Implementation Business Case c) The Delivery Phase Design, Procurement, Construction 4 Refining the preferred service of models of care in detailed consultation with Departments, staff and the community. Redevelopment of Dunedin Hospital Project Brief Stage 1 6
d) Post Implementation Review Refer to Appendix for further information on the Health Business Cases. d) Assurance Assurance requirements are built into the Better Business Cases model. 1) A Risk Profile Assessment (RPA) will need to be completed at the commencement of the project. 2) Subject to the outcome of the RPA, Gateway Reviews 5 will need to be completed and the outcome discussed with SPG in December. These are independent and confidential peer review process that examine projects and programmes at key points in their lifecycles to assess their progress and to rate the likelihood of successful delivery of their outcomes. The key decision points (or gates ) are: Gate 0: Strategic Assessment Gate 1: Business Justification & Options - Indicative Business Case Gate 2: Delivery Strategy - Detailed Business Case Gate 3: Investment Approach Gate 4: Readiness for Service Gate 5: Operational Review & Benefits Realisation It is likely the project will be deemed of sufficient risk that it will be required to complete Gates 0 and 1 as part of Stage 1 of the project. The Southern Partnership Group will determine what other peer reviews of work are required. The Capital Investment Committee will review the Strategic Assessment and Indicative Business Case produced by the project. They will provide their independent advice to the Ministers of Health and Finance on these documents as part of the sign-off process. 5) Stakeholders, Organisational Implications and Handover a) Key Stakeholders The following stakeholders (internal and external) have been identified as playing a key role in the success of this project. This will be expanded on in a formal communications plan. Stakeholder Relationship to Project Initial Engagement Approach Cabinet Will formally sign off on each stage of the Better Business Officials will provide reports and attendance at meetings 5 Gateway is Cabinet-mandated for high risk capital projects and programmes run by Government departments and Crown Agents refer http://www.treasury.govt.nz/statesector/investmentmanagement/review/gateway/gatewayfactsheet.pdf Redevelopment of Dunedin Hospital Project Brief Stage 1 7
Ministers of Health and Finance Capital Investment Committee (CIC) Southern Partnership Group (SPG) Southern DHB (including the Executive, Clinical Council and clinical leaders) Treasury Ministry of Health University of Otago (occupy 20% of the Dunedin campus) Case Model and any additional capital works Will provide to recommendations to Cabinet on each stage of the Better Business Case Model and any additional capital works Will review and provide the Ministers of Health and Finance with independent advice on the key business case documents produced by the project. Governance role for the project Partner to the project. Owner and end user of any completed capital works. Oversee the assurance requirements for the project and will provide official advice to joint Ministers Partner to the project. Will oversee the initial contract arrangements. Responsible for supporting both SPG and CIC and providing advice to joint Ministers. Share staff and students with Southern DHB. The Dunedin School of Medicine has its offices on the Dunedin Hospital Campus in the Ward Block. The University has its own Master Site Plan that includes a Health Precinct as required. Quarterly Reports are required from SPG to the joint Ministers. Reports and meetings with officials as required. This project is a high priority for CIC and the Ministry of Health. 6 CIC will also need progress reports on any approved capital work funded from the Health Capital Budget.. Orientation meeting and arrange meetings with key stakeholders in Dunedin. DHB management and staff need to be fully involved in all processes run by the project team. Southern DHB will be a joint sponsor of the project team, provide communications support for Southern DHB. Will attend the Southern Partnership Group and Steering Group This project is a high priority for CIC and the Ministry of Health. Will be a joint sponsor of the project team and provide communications support for SPG. Arrange meeting between SPG and University of Otago representatives to discuss ongoing input. Otago Polytechnic Provides clinical training Cover in communications plan Staff and Professional Associations DHB staff will raise issues and concerns with their own professional associations Cover in communication plan Staff and patients are the end users. Good staff involvement 6 One of the SPG members is also a member of CIC Redevelopment of Dunedin Hospital Project Brief Stage 1 8
Dunedin City Council Southern DHB community/ patients Media Rural Hospital Trusts, PHO and Alliance South and unions. Dunedin Hospital is a significant asset to the city and the Dunedin campus site is centrally located on a constrained site that is also bound by State Highway 1 on Cumberland Street. Central to any service planning work and the consumer of services at any new facilities The local media already have a strong focus on reporting on Southern DHB matters including service issues, the formation of the Southern Partnership Group. Southern DHB s financial deficit and the work of the Commissioners. Need to be involved in the strategic planning phase and clinical leadership is recognised as critical to completing the BBC processes. Arrange meeting between SPG and key council representatives to discuss ongoing input. 7 NZTA may also need to be involved in the future. Staff and patients are the end users. They will need to be focused on in the communications plan. The project will look to set up a website with publicly accessible information on it Cover in the communications plan. The project will look to set up a website with publicly accessible information on it. The Chair of SPG is the designated contact for media communications. Meetings to be set up by the Health Planners being appointed by RFP b) Stakeholder Engagement & Comms Plan As per the terms of reference for SPG: a) The Southern Partnership Group is to provide the Minister of Health, the Southern DHB and the Ministry with reasonable advance notice and the content of any media statements or reports to be publicly published. b) Partnership Group members, including ex officio members and members of advisory committees, and staff supporting the Hospital Redevelopment Partnership Group may not comment on the developments, to external individuals or organisations, including the media, without the prior agreement of the Chair. c) The Southern DHB Commissioner (or Board Chair) is the spokesperson for Southern DHB. A communications plan and protocols for sharing information will be developed by MoH communications staff working with Southern DHB communications staff. The communication plan will become part of the overall Stage 1 project plan. It may not be finalised until after meetings between SPG and the University of Otago and DCC are held. 7 One of the SPG members is currently a Dunedin City Councillor Redevelopment of Dunedin Hospital Project Brief Stage 1 9
c) Handover Approach The main deliverables from Stage 1 are the key business case documents and service plan for Dunedin which will be inputs to subsequent stages of the project. 6) Risks a) Project Dependencies There will need to be a review by the health planners and business case writer of key reports already commissioned and produced by Southern DHB including the Service and Facilities Strategy document and Strategic Health Plan 2015-20125. The RFPs associated with the Strategic Assessment and Indicative Business Case will invite respondents to outline the processes they will run with Southern DHB within the set timeframes. Minimum levels of engagement will be specified. It is currently assumed they can be completed within the indicative timeframes otherwise they will delay the work. b) Other Key Risks The following risks have been identified as having the potential to delay progress of the project and/or impact on the ability to achieve the deliverables. Risk Description (If X happens, there is a risk of Y, meaning Z impact) The initial timelines assume that the work already completed by Southern DHB will shorten the usual processes in the Stage 1 of the project. Not all resource has yet been appointed to support the project and planning for involving Southern DHB staff in the Strategic Assessment Phase needs to be worked through as part of the RFP process. There has been relatively little communication with key stakeholders to date as the project has worked through its establishment processes. Misinformation may already be in circulation. The Health Planners appointed by RFP to work on Stage 1 will need to keep up to date with the work to implement the Southern Strategic Health Plan Risk Rating Medium Medium Medium Medium How Risk Will Be Managed The consultants will commence their work with a review of all relevant documentation produced by Southern DHB. They will be asked to meet with the SPG in February. As part of the RFP respondents are to outline the process they propose to run with Southern DHB. The Steering Group will be able to focus on the arrangements for involving Southern DHB staff. SPG will be kept updated at its meetings. Cover in communications plan and develop material on the scope of the project and key dates for wider dissemination. Create a website with publicly accessible information to be managed by the MoH s communications resource with links to Southern DHB communications. Will be managed as part of monthly reports to steering group and communications plan. Redevelopment of Dunedin Hospital Project Brief Stage 1 10
Given the long timeframes involved in capital projects there is a risk that the scope of work and approvals given are relitigated in the future. Medium Manage through good documentation and full consultation processes 7) Funding and Resourcing a) Funding Arrangements On 29 October the project was granted $1.6M from the Health Capital Envelope until 30 June 2016. This budget will be used for project establishment, supporting the Southern Partnership Group (including travel and meetings), Ministry of Health staff costs, assurance processes like Gateway Reviews as well as funding for additional project team resources (refer overpage). A separate budget bid for 2016/17 will need to be prepared in April 2016. Strategic Planning Stage(June 2016) Funding ($) Item Consultants Health Planner plus team xxxxxxx Strategic Service Plan Service Plan Strategic Assessment Financial analyst xxxxxxx Financial model Sundry travel for consultants xxxxxx Project Support Project manager xxxxxx Admin xxxxxx Communications xxxxx Communication Plan Website access Assurance Peer review QS xxxxx Review RFP evaluation Gateway/Assurance xxxxxx Gateway 0 Legal fees xxxxxx RFP evaluation Probity costs xxxxxx RFP evaluation Governance costs Exec Communication travel PCG travel Additional meetings Contingency xxxxxx xxxx xxxxx xxxxxx HRPG costs xxxxxx Total 1,599,960 Redevelopment of Dunedin Hospital Project Brief Stage 1 11
b) Resource Requirements The core project team members for undertaking the planning stage are detailed below. Name Peter Beirne Kieran Reilly Karen Irving Role Executive Director, Southern DHB Senior Project Manager, MOH Senior Advisor Capital MOH Additional key roles still to be appointed into the project team include Communications Support for SPG Consultants for the Strategic Assessment Phase including a) Health planners b) Business case writer(s) A contractor to develop a financial model Health Design Team to work on Indicative Business Case Both MOH and SDHB need dedicated communications support RFP November 2015 TBC RFP to appoint early 2016 NB Treasury will assist contractor RFP April 2016 8) Project Structure a) Project governance Minister of Health Minister of Finance Capital Investment Committee Southern Partnership Group Southern Steering Group Project Control Group Working Groups (TBC) Southern Partnership Group Members: Andrew Blair (Chair) Mr Andrew Connolly Redevelopment of Dunedin Hospital Project Brief Stage 1 12
Dr Tony Lanigan Richard Thomson Dr Margaret Wilsher Ex Officio Other attendees Secretariat John Hazeldine (MOH) Davin Hall (Treasury) Kathy Grant (Southern DHB Commissioner) Carole Heatly (Southern DHB CEO) Kieran Reilly (MOH) The terms of reference for the Southern Partnership Group have been approved by the Ministers of Health and Finance and will be discussed at the first meeting. Southern Steering Group Sponsors: Mhairi McHugh (MOH) or delegate Carole Heatly (Southern DHB CEO) or delegate Other attendees Sandra Boardman (Southern DHB) Peter Beirne (Southern DHB) Leanne Samuel (Southern DHB) Lexie O Shea (Southern DHB) Karen Irving (Ministry of Health) Kieran Reilly (Ministry of Health) Davin Hall (Treasury) An additional clinical representative from Southern DHB will also join the group. The role of the steering group is to support the project team and to ensure the Southern Partnership Group receives timely and appropriate information. The Project Control Group will provide a regular monitoring and catch-up forum for key members of the project team. As different workstreams commence they will report on progress to the MoH Project Manager through the control group. b) Reporting Requirements The reporting requirements will be elaborated on as the project team is built up and the communications plan developed. Initial arrangements are: Who reports To whom What is reported When SPG Ministers of Health and Finance 1) Written Progress Report (Secretariat to prepare) 2) Business Case 1) Quarterly From February Redevelopment of Dunedin Hospital Project Brief Stage 1 13
Documentation 2016 Southern DHB SPG Updates on the approved urgent interim works and any other requests to CIC Southern DHB CIC Updates on the approved urgent interim works and any other requests to CIC Ongoing as per SPG s meeting schedule Quarterly via SPG Project Manager SPG (via Steering Group) Progress Report and Risk Register Ongoing as per SPG s meeting schedule Project team. Work stream leaders and consultants Project Manager Participate in weekly update meetings (additional meetings may be required during establishment) Ongoing Reports on request or as specified in agreements with contractors MoH CIC Monthly reports to CIC Ongoing Redevelopment of Dunedin Hospital Project Brief Stage 1 14
Appendix One: Health Business Case Early engagement A business case approach encourages early engagement with stakeholder to confirm: Fit with strategy and need to invest The way forward with short-listed options That the best value option is affordable and deliverable and that the risks are acceptable Benefits of using the business case approach The key benefits for our stakeholders include: Decision makers better strategic alignment, value for money and evidence based assurance. Project managers early engagement and influence on direction. Business case developers clear expectations with flexibility and permission to take a risk-based, right size approach. Reviews early engagement and common language Stakeholder and public early engagement and influence on direction. Private sector suppliers certainty of implementation. How the Health Business Case approach works The Health Business Case approach is an adaption of the NZ Treasury s Better Business Case (BBC) model, which provides a structured way to develop an investment case in an inclusive way. The HBC will follow the principles of Treasury s BBC process using the key deliverables; strategic case, indicative business case, detailed business case and implementation business case. These are structured into 5 case models being strategic, economic, and commercial, financial and management. Redevelopment of Dunedin Hospital Project Brief Stage 1 15
Strategic Planning Phase (approx.12 months) Strategic Service Plan Reviews whole of health service operations over the next 10 years, providing a foundation for strategic clinical service planning and site specific capital developments. Ensuring the needs of the community are met by the DHB as an integrated and self-sufficient health service with integrated clinical service streams across a DHB. Providing a strategic view of service configuration, models of care and key enablers, determine the need going forward and possible strategies to manage growth, service changes, whole of service alignment and financial viability. Strategic Assessment (Business Case) Determines the key problems. It also provides stakeholders with a high degree of confidence that the investment they are considering aligns with the organisations strategic priorities identified in the strategic Service Plan and responds to a true business need. Stakeholders can consider the rationale for a proposed investment at an early stage and determine if the proposal warrants further business case development. Informed by ILM Proposal Phase (approx.12 Months) Service Plan Service delivery models are an adaption of an organisation's model of care and describes 'where and how work is to be carried out. Service Delivery models suit the local environment and resources to best meet the overarching organisational requirements. Redevelopment of Dunedin Hospital Project Brief Stage 1 16
Masterplan The purpose of a Master Plan Study is to identify and evaluate all the project planning options for the facility with consideration of the services to be provided, demographics, future trends, existing facilities, capital and recurrent costs and implementation strategy. Model of Care A model of care outlines best practice patient care delivery through the application of a set of service principles across identified clinical streams and patient flow continuums Indicative Business Case Provides decision-makers with an early indication for the preferred way forward. It confirms the case for change and the need to invest, identifies a wide range of options and recommends a preferred way forward for further development of the investment proposal, supported by a preferred short-listed options for further analysis. Planning and Evaluation Phase (approx.12 months) Feasibility The feasibility study is a detailed analysis of a preferred facility development strategy as determined in the master plan study. It should enable a DHB to fully determine the outcome, which will provide the most, cost efficient and effective delivery of its services. The preferred options for developing facilities to accommodate service delivery can then be determined. Functional Brief A description of the function to be accommodated and the relationships between functions for a proposed capital project. It should identify how the project meets the objectives and policies of the organisation Detailed Business Case The primary purpose of the Detailed Business Case is to recommend a preferred solution that optimises value for money. Implementation (approx. 12 months) Procurement Study Design development Implementation Business Case Delivery (approx. 18months 3 years) Construction Redevelopment of Dunedin Hospital Project Brief Stage 1 17
Post Delivery Benefits Realisation Post implementation review Post occupancy review Approval process Each completed business case will then go through an approval process. Initial endorsement by Southern Partnership Group, then endorsement from the Capital Investment Committee and finally approval from joint Ministers of Health and Finance and Cabinet if required. Redevelopment of Dunedin Hospital Project Brief Stage 1 18