Medical Associates

Jess i ca Jacobs . Karen Jose . Er in Lenhardt .

Veron ica Locke. Dan ie l Lynn.

Middleboro Ambulatory Surgery Center Business Plan FY 2010

Middleboro ASC

• Duplication of Jasper ASC

• Located within our Middleboro facility

• Satisfy community demand and organizational needs

Rationale: Progression of Organizational Goals

•Return to nurse-dominate staffing structure (as opposed to medical assistants)

CPI #1: Staffing Care Model

•EHR implementation to bill wider payer audience and compliance with Medicare reimbursement guidelines

CPI #2: Payor Mix •Clarify organizational structure of the surgical department: hierarchy and decision-making

CPI#3: Organizational Management

•Increase profitability and market share

CPI#4: Financial Growth

Rationale: Successful Jasper ASC

Rationale: Significant Increases in Demand

Demand: The Base Case

Base Case Calculations

% of Uptake

Total Current

Procedures

Total Uptake

Procedures

Middleboro Community Hospital

23% 3455 781.5

MA Jasper ASC 20% 3046 609.2

Total Procedures 6501 1390.7•Limit the initial base case from our Jasper ASC to 20% of existing cases

•60% of our 37.7% market share, for a total of 23% of MCH’s ambulatory surgery market

Demand: Projections and Utilization

Finance: Debt, Staffing, and IT

Debt Financing

• Borrow debt in two stages, once in 2010 and once in 2011.

• 8% Interest Rate

• This debt will cover: • Facility Modernization• Pre, Post, and Operative Suites• Recruitment Costs • IT Investments – including mobile

devices and imaging

Human Resources & IT

Human Resources: • HR structure will remain primarily the

same• Hire, in conjunction with our Jasper ASC:

– 9 RNs by 2013– 6 Surgeons by 2014

Information Technology: • Implement EHR approved by MA• Purchase flat screens and mobile

devices for all staff members

Finance: Expected Returns

Break Even Analysis

Time Breakeven 4.37 Years

Net Present Value

$ 102,900Horizon Value (2015)

$ 2,063,377Present Value (including Horizon)

$ 2,711,571

Internal Rate of Return 25%

Modified IRR 23%

Finance: Profit and Loss

Risk Management

External• Legal Risks

– Stark Laws– Anti-Kickback Laws– Anti-Trust Laws

• Ethical Risks– Middleboro Community

Hospital– Community Impact

Internal• Technology

– Interoperability– EHR in an ASC

• Personnel & Management– Staff Competency

• Patient Care– Infection Control– Sentinel Events

Risk Management

Probability of

Occurrenc

e

•Ethical risk – Relationship with Middleboro Community Hospital

•Cultural risk: phase-in of nursing model

•Interoperability of newer technology systems (iPad, flat screens, etc)•Personnel issues (hiring competent staff)

•ASC-tailored EHR system

•Inadequate patient care•Legal compliance•Financial – demand projections not realized

Impact of Risk

Implementation Timeline

Renovation and Investment of Suite A

Seek CMS Accreditation

Electronic Health Record Implementation

Organizational Restructuring

Recruitment of RNs

Recruitment of Physicians

Labor Investments

Investment of Suite B

Opening of Suite A

Opening of Suite B

2010 2011 2012 2013 2014 2015

Rationale: SWOT Analysis

Strengths• T

echnological advancement

• Community benefit

• Internal stakeholder benefit

• Debt financing

• Strong market position

Weaknesses• L

iquid capital

• Staff communication, ambiguous authority, and decision making

• Organizational management and need for knowledge, skills, and expansion management

Opportunities• N

ew and/or expanded service lines (orthopedics, cardiac services, and family practice)

• Market growth – expanded insurance coverage

• New payment & reimbursement opportunities

• Meaningful Use Incentive Payments

Threats• A

dversely impacted relationship with Middleboro Community Hospital

• Increased risk – debt, higher fixed, and variable costs

SWOT Analysis

Middleboro ASC

• Questions & Answers