HLTH 5683 Module 5 Budget, Communication and Change Control Plan Example

A $1.88 Million Baseline, Six Audiences and a Second Pass-Through: Budget, Communication and Change Control for a Hospital Cleanroom Project

Student Name

American College of Education

HLTH5683: Project Management for Healthcare Administrators

Module 5 Assignment

Instructor Name

October 2, 2028

The Cost Baseline

The charter approved $2.04 million for the composite hospital's sterile compounding suite. The project manager divided it into a cost baseline of $1.88 million, the budget for the planned work, and a contingency of about $157,000 for identified risks, controlled by the sponsor. The baseline is time-phased by month from the schedule, so that planned spending can be compared with progress. Design and approvals account for about $180,000 from October through January, the temporary cleanroom for $90,000 from November through August, construction and air handling for about $1.39 million from February through June and equipment, certification and training for the remainder, mostly in May through July.

The contingency is kept separate so that it is visible. It is not spread across line items, where it would be spent quietly; it is released only by the sponsor, in response to a specific risk in the register, and every release is recorded. Contingency hidden inside line items is not a reserve; it is a spending plan nobody approved.

Earned Value: Seeing Trouble Early

Comparing money spent with money budgeted says little on its own, because spending less than planned could mean savings or could mean the work is behind. Earned value management compares three figures: planned value, the budgeted cost of work scheduled to date; earned value, the budgeted cost of work actually completed; and actual cost. Anbari (2003) describes how these figures produce two indexes: a cost performance index, earned value divided by actual cost, and a schedule performance index, earned value divided by planned value, where values below 1.0 indicate overspending or delay.

A worked example shows how the method will be used. Suppose that at the end of March 2029, the planned value is $1.02 million, the earned value is $950,000 because wall framing is behind and the actual cost is $1.01 million. The cost performance index is 0.94 and the schedule performance index is 0.93. Dividing the $1.88 million baseline by 0.94 gives an estimate at completion of about $2.0 million, roughly $119,000 over the baseline, which would consume most of the contingency. A simple comparison of spending, $1.01 million against $1.02 million planned, would have suggested the project was on budget. The earned value report would prompt a review of the wall framing crew, the likely cause of both indexes falling, while there was still time to act.

Communication by Audience

The communication plan lists each audience, what it needs to know, how often, through what channel and from whom. The sponsor, the chief pharmacy officer, receives a monthly one-page report with the earned value indexes, the critical path float, the top five risks and any pending change requests, from the project manager. The steering group, which includes facilities, infection prevention, pharmacy and finance, meets every two weeks during construction. Pharmacy staff, who will work in the temporary cleanroom and then the new suite, receive a weekly update at their huddle from the designated person for sterile compounding, including what will change for them in the coming week.

Nursing units, the operating rooms and labor and delivery, which rely on compounded preparations, receive notice from the director of pharmacy two weeks before each transition, the move to the temporary room and the move to the new suite, with the name of a pharmacist to call during each. Regulators, the building official, fire marshal and state board of pharmacy, receive formal notices from the facilities project manager at each approval point. And the outsourcing vendor receives written volume forecasts from procurement each month, so that supply does not drop before the new suite can replace it.

The Change Request Process

Any change to scope, schedule or budget starts with a written request stating what is proposed and why. The project manager then prepares an impact analysis covering cost, effect on the critical path, new or changed risks and compliance with the sterile compounding standard, since a change that makes the suite harder to certify is not a small change. Approval depends on the impact. The project manager may approve changes under $10,000 with no effect on the critical path. The sponsor may approve changes up to 5 percent of the budget and two weeks of schedule. Anything larger goes to the hospital's capital committee. Every request, approved or not, is entered in a change log with its decision and reason. The Project Management Institute (2021) describes this kind of integrated change control as the way to ensure that changes are reviewed for their effect on the whole project before they are accepted.

Changes After Construction Starts

The same request costs more, and carries more risk, the later it arrives. A second pass-through requested before the wall is framed is a drawing change; the same request after the wall is finished means cutting an opening inside an active construction zone next to a working compounding room. The process therefore adds two steps for any change requested after demolition begins. First, the infection prevention director must review whether the change alters the infection control risk assessment, such as by requiring a barrier to be opened or extended, and may attach conditions or refuse. Bartley (2000) described infection control professionals' role as continuing through every phase of health care construction, including changes made once work is under way, and this step puts that role into the change process rather than relying on someone to remember it. Second, the certifier is asked whether the change could affect air flow or pressure, since an opening, a new penetration or a relocated fixture can undo a balanced design.

The project manager will remind requesters of these extra steps at the start of construction, with a simple message: if you want something changed, ask now. Requests made during design are nearly free; requests made during construction are slower, dearer and sometimes unsafe.

Two Worked Change Requests

Change request 1: the designated person for sterile compounding asked to add a second pass-through between the ante-room and the buffer room, so that finished preparations and incoming supplies would not share one opening. The impact analysis found a cost of $14,000, no effect on the critical path because the wall was not yet built and a small improvement in contamination control. Because the cost exceeded $10,000, the sponsor approved it from the baseline's design allowance, not from contingency. The change log records the decision, and the communication plan's next update told pharmacy staff and the certifier.

Change request 2: the pharmacy's informatics lead asked to install data cabling and wall-mounted scanners in the buffer room for the intravenous workflow software the pharmacy hopes to buy. The impact analysis found a modest cost but a scope conflict: the charter explicitly excludes the workflow software, which is a separate project without approved funding. The sponsor declined the request and directed that the design include spare conduit, costing about $1,200, so that cabling can be added later without opening walls. Saying no to a reasonable request is easier when the charter already said why.

References

Anbari, F. T. (2003). Earned value project management method and extensions. Project Management Journal, 34(4), 12-23. https://doi.org/10.1177/875697280303400403

Bartley, J. M. (2000). APIC state-of-the-art report: The role of infection control during construction in health care facilities. American Journal of Infection Control, 28(2), 156-169. https://doi.org/10.1067/mic.2000.106055

Project Management Institute. (2021). A guide to the project management body of knowledge (PMBOK guide) (7th ed.). Project Management Institute.