Italian company wins bid for new general hospital

POSTED: 08/10/16 2:57 PM

St.maarten– The Italian company INSO has won the bid for the construction of the new hospital. With a bid of $59,578,655 the company outbid Vamed ($80,149,443) and BAM/Philips ($138,843,852). The difference between the lowest and the highest bid is close to $80 million. Contract negotiations with INSO will be concluded by August 30, and construction will begin in September. The new hospital is scheduled to open its doors in June 2019.

Yesterday afternoon Public Health Minister Emil Lee, interim SZV director Glen Carty, SMMC-director Kees Klarenbeek and Henk de Zeeuw, project manager at KPMG and an advisor to the tripartite of government, hospital and SZV announced the winning bid during a press conference at the government administration building.

The hospital will be built at the location of the current medical center. The number of beds will increase from 66 to 110, and the hospital requires 73 additional staff – 24 general nurses, 45 specialized nurses and technicians and four doctors assistants.

During the construction phase the project will require jobs at one or more local contractors who will work under the responsibility of INSO. Local involvement in the construction was one of the five main criteria.

Minister Lee noted that the current medical center has outlived its lifespan and that one of the main priorities when he took office was the provision of affordable healthcare. “This is an important milestone; the team has worked tirelessly to get the project where it is today. This will be a modern, affordable, practical and efficient hospital. It will result in fewer referrals abroad and improve the recovery time for patients.”

The contract negotiations with what is currently called ‘the nominated contractor’ begin this month and construction will begin in the third quarter, “providing that financing is in place,” the minister said, though this does not seem to be a problem.

The ideal financing structure requires the approval of financial supervisor Cft and it would open the door to cheap capital with an interest rate between 1 and 2 percent. However, SZV is also prepared to finance the project; it would get a 5 percent return on its investment. Henk de Zeeuw clarified that, in case the approval from the Cft takes too much time, SZV will step in to help with the financing.

St. Maarten Medical Center director Kees Klarenbeek emphasized the importance of the tripartite – government – hospital and SZV. “Working together has made it possible to build this new hospital,” he said. Step by step we will move towards a better quality healthcare. This is a huge step forward.”

Klarenbeek noted that the current hospital is too small, too old, and too expensive to maintain. “We have been looking forward to this moment for a long time. This will enable us to provide more healthcare close to home.”

The hospital will be a safe building, Klarenbeek said, referring to its hurricane and earthquake proof construction. Furthermore, he added, this new hospital is “an absolute necessity.”

“This means a lot for our patients especially for those who have now to go abroad,” interim SZV director Glen Carty said. “Imagine: no more travel issues, no more immigration issues, no more language issues.”

Prime Minister William Marlin said he had very little to add to the statements made by Minister Lee and the others. “Congratulations are in order; this is worth a celebration, not only for the minister. This is also a milestone for the SMMC and its employees, and for SZV and it will benefit our people. SZV will no longer have to write huge checks for people going abroad; this will bring down the cost of healthcare.”

Marlin noted that his political adversaries will say that they were already busy with the project and that his government now runs with it. Minister Lee however said that when he took office, he found a “rushed decision to award the new general hospital project to a company without public tender. Awarding a contract of this magnitude without a public tender violated all principles of an open and transparent government.”

The Council of Ministers reversed the decision. In April 2015, then Public health Minister Rafael Boasman said at a Council of Minister press briefing that his department was talking with the Austrian company Vamed about the construction of the new hospital.

Minister Lee said that the previous government wanted to give the project to Vamed for more than $100 million.

Vamed still made the cut to the shortlist of three bidders for the project, but its bid was around $20 million higher than INSO’s winning bid. Vamed also offered a maintenance price for a period of twenty years of $102,955,560, while INSO’s bid for the same aspect of the project is just $45,600,483.

Asked about the huge difference between the highest and the lowest bid – around $80 million – KPMG-project manager Henk de Zeeuw said that each bidder had come up with its own solutions, and that some were more luxurious than others.

Asked whether INSO’s project price is written in stone, or that the country may face serious cost overruns in the next couple of years, De Zeeuw said that the project is based on a standard contract. “It is turn-key with a fixed price,” he said. “We expect to stay close to the budget. The only reason that it could become more is when you want to add something to the current design.”

Minister Lee said that yesterday’s milestone had been reached “not in isolation or secrecy but in an environment of openness, transparency, collaboration and partnership. It is this inclusive process that will ensure that this hospital will become a reality.”

Five independent evaluation teams scrutinized the three bids for the project. INSO scored high on the price for design, building and maitenance costs, quality, timing and local involvement. With a score of 165.4 points out of a possible 200, the winner left BAM/Philips (103.8) and Vamed (82.8) far behind. The contract includes the building of the hospital as well as state of the art medical equipment.

The hospital will have 110 beds in clusters of one and two beds per room and four state of the art operating theaters including one with a limited heart intervention lab. Other additions include a dedicated dialysis center, telemedicine for diagnosis and treatment by specialists abroad, increased parking and ease of access for patients and visitors.

The new hospital will offer the following other services: emergency care, obstetrics and gynecology, general surgery, internal medicine (nephrology, oncology and infectious diseases), gastroenterology, pediatrics, cardiology, dermatology, anesthesiology and pain clinic, ear-nose-throat, radiology including advanced MRI, psychiatry, urology, neurology, orthopedics, ophthalmology, pulmonology, hematology and dialysis.

The hospital will have a helipad for emergency evacuations.

Referrals for treatment and diagnosis abroad will go down by 85 to 90 percent.

SZV will become the owner of the hospital, unless low interest financing from the Netherlands becomes available with the approval of financial supervisor Cft. In that case, the government will own the hospital.

The contract contains penalties in case the contractor takes more than 36 months to finish the project and rewards when it completes the project quicker.

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