penetrate new markets: evaluate opportunities in different geographies, in other parts of the value...
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An Affordable HealthcareOutlines for a Public HospitalDecember 2012
Healthcare Business: An Overview
Competitive Advantage for the Healthcare Industry
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Penetrate New Markets: Evaluate opportunities in different geographies, in other parts of the value chain, and through new lines of business
Grow Revenue: Ensure optimal pricing, optimize product/service portfolios, and expand distribution channels
Track Competitors and Drive Differentiation: Track competitors' product developments, customer markets, and geographic expansion; identify unique and sustainable product and brand positioning
Acquire and Retain Customers: Develop a deeper understanding of customers' diverse requirements and unmet needs
Predict and Respond to Market Dynamics: Monitor, forecast, and proactively respond to trends in regulations, technology, and emerging business models
http://www.bostonanalytics.net/business_research_analytics/healthcare_analytics.html
Healthcare Value Chain
4http://www.scientiaadv.com/blog/2011/01/11/was-2010-the-engagement-year-between-pharmaceutical-and-diagnostic-companies/
Research Tools
Product Development
Regulatory Approval and
Reimbursement
Healthcare Delivery
Genomics
Proteomics
Metabolomics
Pharmaceuticals
Diagnostics
Regulators
Governments
Payors
Physicians
Pharmacies
Hospitals
Healthcare Business
Healthcare Development
5http://lumetrasolutions.com/integrated-solutions/value-convergence/
Proactive Procedures
Information Technology
Resources & Logistics
Clinical Workflow
Optimization
Sustainability
Prevention Programs
Payor Issue
6http://www.healthonomics.org/2007/11/healthcare-value-chain-new-business.html
ProducersDistribution IntermediateProvidersFinance
IntermediatePayers
Cost
Innovation
Classic Approach
Producers
Distribution Intermediate
Providers
Finance
Intermediate
Payers
New Approach
Consumer
Driven
Healthca
re
Personalized Healthcare
Retail HealthcarePublic Health
care
http://www.cross-check.com/blog/bid/158182/Medical-Payment-Services-Help-with-Rising-Costs
Obamacare: Complexity of Healthcare
7http://www.generationamerica.org/obamacare/
Healthcare Spending in E&NA
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Healthcare @ GDP
9http://economix.blogs.nytimes.com/2009/07/08/us-health-spending-breaks-from-the-pack/
Hospitalization: In most countries, this just means care that takes place in a hospital. The US is in outlier, in this case, though. Here, doctors might be employed by a hospital, or they might contract with one. In the latter case, a doctor would use hospital facilities but be paid by patients (or insurers). OECD counts this as ambulatory care.
Ambulatory care: Care that happens outside of hospitals, which may include general out-patient services, specialist practices and private clinics.
Public health: Efforts, usually on the part of governments, to manage the well-being of a population, for example vaccination campaigns, education and disease response.
Pharmacies and medical goods: Drugs, syringes, stents, wheelchairs and other purchased goods related to health care.
Administration: The overhead costs of health care, from billing to building maintenance, essentially everything not related to patient care in a system. In the U.S., "administrative costs" includes the cost of managing public programs such as Medicaid and Medicare, as well as the administrative costs of the private health insurance industry.
Data Sources: OECD Health Data 2009, World Health Organization World Health Report 2000.
Healthcare Reform
10http://www.pbs.org/newshour/indepth_coverage/health/healthreform/july-dec09/chart_08-18.html
Cost Breakdown
11http://healthcare-economist.com/2011/02/24/patient-centered-health-spending-categories/
Rethinking entire production processes and
business models
The First is to contract out ever more work
The Second money-saver is to use existing
technology in imaginative new ways.
The Third way to cut costs is to apply mass-
production techniques in new and unexpected
areas
“Frugal” Constraint-Based Innovation
Reverse Innovation
Henry Ford's Style
A health-insurance scheme, working with various local self-help groups, that covers 2.5m people for a premium of
about 11 cents a month each
A sliding scale of fees is used for operations so that richer customers subsidize poorer ones
Hospital group reports a 7.7% profit after taxes
Dr Shetty has performed more than 15,000 heart operations and other members of his team more than 10,000
Narayana Hrudayalaya Hospital in the “Electronics City” district of Bangalore, has 1,000 beds (against an average of
160 beds in American heart hospitals), and Dr Shetty and his team of 40-odd cardiologists perform about 600
operations a week.
An Indian Breakthrough
12http://www.economist.com/node/15879359?story_id=15879359
A Hospital
13http://www.reverehc.com/Consulting.html
Logistics and Supply Chain
Mobility & Reach-out
Emergency & Trauma
Departments
Medical Centers & Clinics
Type of Hospital
Medical & Technical Staff
EPC Cost Plan
14http://baydim.com/BayDim02HospitalCosts.htm
Creating Fable 2.0Like its predecessor, the Fable 2.0 hospital is an imaginary facility located in a medium-sized American city. It is a new three-hundred-bed regional medical center built to replace a fifty-year-old institution. Fable 2.0 provides a comprehensive range of inpatient and ambulatory services. It is located on a donated urban site, so the cost of the land is not included in the calculations. Fable 2.0 is approximately 600,000 square feet (2,000 square feet per bed) and costs $350 million to construct. Construction costs have increased substantially since 2004. According to Turner Construction, the average cost per square foot in an average city has more than doubled, from between $170 and $185 per square foot, to approximately $450 per square foot today. While construction costs in some areas are significantly higher or lower, we chose $450 per square foot as our baseline. Fable hospital's leadership promotes superior clinical quality, safety, patient-focused care, family friendliness, staff support, efficiency, community responsibility, and ecological sustainability. Reflecting the latter goal, Fable 2.0 decided to achieve a sustainable building that met LEED's gold-certified level using a range of construction and operational initiatives.
http://www.medscape.com/viewarticle/736012_3American Hospital Association Resource Center Blog
Apollo Hospitals - India
15http://www.apolloglobalprojects.com/images/news_pdf/Financing%20Healthcare.pdf
Healthcare in Africa
Diseases in Africa
17The future of healthcare in Africa, A report from the Economist Intelligence Unit, sponsored by Janssen
Treatable diseases continue to blight the futureThe continent’s continuing struggle with communicable diseases such as HIV/AIDS and tuberculosis (TB), parasitic diseases and poor primary and obstetric care has been a major factor in stalling the development and the extension of healthcare services in African countries at the most basic level.
Life Expectancy in Africa
18The future of healthcare in Africa, A report from the Economist Intelligence Unit, sponsored by Janssen
Healthcare Spending in Africa
19The future of healthcare in Africa, A report from the Economist Intelligence Unit, sponsored by Janssen
Payors in Africa
20The Business of Health in Africa, IFC, World Bank Group
Healthcare Funds in Africa
21The Business of Health in Africa, IFC, World Bank Group
Consistent with international trends, this growth in GDP will drive a greater demand for health care and an increase in per capita expenditure on health related goods and servicesBased on projected economic and population growth rates, the health care expenditure in Sub-Saharan Africa is expected to grow from $16.7 billion in 2005 to $35 billion in 2016 an annual growth rate of 7.1 percent per annum.
This report also estimates that around $25–$30 billion in incremental investment will be required for the physical assets (hospitals, clinics, distribution warehouses, etc.) needed to meet this increased demand over the next ten years.
Healthcare HR in Africa
22The Business of Health in Africa, IFC, World Bank Group
Healthcare Investment in Africa
23The Business of Health in Africa, IFC, World Bank Group
The priorities include:1. Developing mechanisms for creating and enforcing quality standards for health services and medical product manufacturing and distribution;2. Including as many of the population as possible in risk pooling programs;3. Channeling a portion of public and donor funds through the private health sector;4. Enacting local regulations that are more encouraging of a private health care sector; and5. Improving access to capital, including by increasing the ability of local financial institutions to support private health care enterprises.
Comparison of Unit Cost
24ANALYSIS OF HOSPITAL COSTS: A MANUAL FOR MANAGERS, by Donald S. Shepard, Ph.D., Dominic Hodgkin, Ph.D. and Yvonne
Anthony, Ph.D. , September 29, 1998, Institute for Health Policy, Heller School, Brandeis University
Cost of Hospital Care for HIV/AIDS Patients
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PatientFinancing
and location
Totalnumberof cases
Daysper
patient
Costper
Day+
Costper
Patient+TotalDays
TotalCost+
Private coverage 906 34.0 52.5 1,785 30,804 1,617,210
Civil servants 1,812 20.0 10.6 212 36,240 384,142
Other urban Abidjan 8,699 16.3 15.0 245 141,794 2,126,906
Other urban interior 3,624 14.0 5.0 70 50,736 253,680
Rural 3,081 5.0 5.0 25 15,405 77,025
Total or Average* 18,122 15.2 16.2 246 274,979 4,458,965
* This row represent totals for columns with heading beginning with “Total,” and averages for other columns.+ All monetary amounts are in thousands of F CFA, where 1,000 F CFA equals US $2.00.
Côte d’Ivoire, 1995
ANALYSIS OF HOSPITAL COSTS: A MANUAL FOR MANAGERS, by Donald S. Shepard, Ph.D., Dominic Hodgkin, Ph.D. and Yvonne Anthony, Ph.D. , September 29, 1998, Institute for Health Policy, Heller School, Brandeis University
Hospital Construction Cost Model
26http://www.maps-jo.com/www.maps-jo.com/Calculate_Gross_Hospital_Area_Construction_Cost.php
Proposal Outlines
Investment & Development Management
FeasibilityPlan
The Hospital Facility
Theme Approach
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Patient
Free Paid Combined
Self Paid
Fully Insured
Investment StructureDonors
Impact Investor
Seed Investor
Government
Operator Funds OPEX
Recoveries
CAPEX
Volunteer NGO
SustainabilityFramework
Project Management
OperationsManagement
Critical Success Factors (CSFs)
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Information Management Systems
Procurement Governance
Optimized Design Solutions
Logistics & Supply Chain
Resources & Training
Marketing & Sales
Performance Monitoring
Financial Model
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Sustainability
Growth
Innovation
Optimization
Outflows
OPEX
Recovery Plan
CAPEX
Initial Investment InvestmentPlan
Inflows
Subscriptions
Self-Paid Patients
Insurance Policies
InvestmentPlan
Facility Model
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Target CAPEX US$ 150k/Bed
GFA 20,000 m2 100 m2/Bed
Public Basic Infrastructure
Minimum Area50,000 m2
FAR 0.4Single Story
Accessible to Public Transit
160 Ward Bed20 Single Bed
20 Double Beds
ER200 Visits/Day
OP20 Clinics
ICU10 Beds
FF&E CostUS$ 2,000/m2
Target Profitability
5%
Served Population
200,000 Capita
CSR, Vocational and Volunteer
Programs
Compliances to WB. IFC, UNDP
& ADB Codes
Land/PlotCapital Investment
Development Baselines
StatuaryPermits
Conceptual Master Plan
Independent Operating Corporate
Target OPEXUS$ 2,000/Case
Construction Cost
US$ 2,000/m2
EPC Contract18 Months
Strong Payors Programs
Timeline
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H1/Year -2 H2/Year -1 H2/Year 1H1/Year 1H1/Year -1H2/Year -2
ESC Corporate & Capacity Building
Hospital EPC, FF&E and FM
Corporate Social Contribution Plan
OrganizationStrategy & BD
Finance
LogisticsEngineering
Quality
Procurementof Contractors,
Operators & Suppliers
FF&E
FM Operator
FF&E DLP
Medical Operations
Marketing & Sales Operations
Implementing CSR Programs
EPC
HRLegal
Procurement
SalesMarketing
Internal Audit
Planning CSR Programs
EPC DLP
Thank You
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