Factors influencing cost overruns in publicly funded hospital projects

Abstract

In the context of Vietnam's strong economic development and increasing demand for healthcare, enhancing healthcare infrastructure and addressing the issue of overcrowding in public hospitals has become a crucial government objective. This study focuses on identifying the factors influencing cost escalation in public hospital construction projects funded by public investment. The research applies a non-probability sampling method, using convenient sampling and Referral/Snowball sampling techniques. A total of 120 individuals participated in the study, including investors, project managers, design and construction contractors, subcontractors, and relevant suppliers. The study's findings have identified and ranked the ten most significant factors affecting cost escalation in public hospital projects. These factors include inadequate functional design, inadequate functional design, delay in disbursing public investment capital, unforeseeable events, design errors leading to repetitive construction, impact of exchange rate fluctuations on imported medical equipment, unfavorable weather conditions during construction, delay in providing adjusted contract prices or approving adjusted investment amounts, complex geological conditions, and use of estimated quantity estimates in bidding when design is incomplete. The results of this research contribute significantly to the management of construction costs in public hospitals, particularly in the context of public investment funding.