Review of the Replacement of the Denver Medical Center, Eastern Colorado Health Care System

The concept for the Denver Medical Center Replacement project dates back to the late 1990s and was in response to the region’s growth in the veteran population and the need to replace an aging and inadequate facility built in 1951. The new facility will be larger than the current facility by approximately 600,000 square feet. The Denver project will provide additional functional capability, such as more examination, treatment and dental procedure rooms, as well as 30 beds designated for Spinal Cord Injury patients. (The existing hospital has none.) The project took years to start due to decisions under five former VA Secretaries that resulted in extensive changes to the concept, scope, and design of the project from 2000 through 2009. Significant and unnecessary cost overruns and schedule slippages related to the construction of Denver Medical Center were primarily the result of poor business decisions, inexperience with the type of contract used, and mismanagement by VA senior leaders. The OIG’s review identified major points of failure that encompass a series of questionable business decisions by VA senior officials concerning planning and design, construction, acquisition, and change order issues. Congress appropriated $800 million between 2004 and 2012 for land acquisition, design, construction, and consultant services. VA’s 2009 acquisition plan initially estimated construction would be finished in 2013. However, 2015 project estimates place the final cost at approximately $1.675 billion or more than twice VA’s fiscal year 2009 approved $800 million project budget. The project is estimated to be completed mid to late 2018, or almost 20 years after VA identified the need to replace and expand its aging facility in Denver.