Financial Analysis/Management - Case #1
Market Analysis
Issue
An unusual opportunity to obtain substantial property at no cost, coupled with a growing demand for increasingly sophisticated research facilities and healthcare services as well as a space-constrained campus were the primary reasons that this health sciences center decided to relocate to a new campus.
At the onset of the engagement, the health sciences center's senior leadership recognized the need to develop a detailed database as the foundation for forecasting research-facility needs, student enrollments (medical, nursing, dental, pharmaceutical, graduate), and patient volumes in the affiliated, private hospital. This in-depth market analysis then lead to the development of a detailed capital forecasting model to analyze capital requirements needed to support the relocation of the entire campus and its multiple functions over 12-year and 20-year periods.
Solutions
Following the preparation of workload forecasts, consultants with Turning Point Healthcare Advisors, Inc., worked with the master site planner to develop a master plan, supplemented by detailed financial forecasts, to meet the demand expected over the next 20 years.
Results
We successfully accomplished the following:
Prepared a detailed market analysis
Forecasted student enrollments in the various teaching programs
Assisted the project architects in preparing a site and facility master plan for the university's relocation to a new campus
Developed a flexible forecasting model to determine when and how much capital would be required to support the relocation of various buildings and functions over a 12-year as well as a 20-year period
Assessed the extent to which costs would be duplicated as a result of operating two campuses over an extended period of time
Collaborating with Perkins and Will (Chicago, IL) on this project, we prepared the market analysis and created the financial model to forecast capital requirements.
Financial Analysis/Management - Case #2
Issue
A major home healthcare provider in the West experienced difficulty accounting for the Medicare Prospective Payment System and other financial related issues.
Solutions
Consultants with Turning Point Healthcare Advisors, Inc., were contracted to assist the CEO in providing leadership to the accounting staff and assist in resolution of these issues.
Results
We successfully accomplished the following:
- Reviewed PPS payment reports and recommended entries to correct prior reports
- Developed a cash flow forecast used to increase a bank line-of-credit
- Reviewed the statements of cash flow and assisted staff in making corrections
- Developed a plan to prepare for the fiscal year-end audit
- Trained internal staff
Financial Analysis/Management - Case #3
Pediatric Hospital Strategic Plan and Financial Analysis
Issue
The impending opening of a state-of-the-art, university-affiliated children's hospital prompted this institution to prepare a strategic plan that would position it to become the premier provider of children's health services in its geographic region. In addition, no financial forecast regarding the new facility's viability had been prepared prior to construction.
Solutions
Our approach to the two issues was two-pronged. First, consultants with Turning Point Healthcare Advisors, Inc., developed a process to secure input from university administrative personnel as well as from key physicians on the faculty. As a result of one-on-one interviews as well as a number of group meetings, the university's pediatric component crafted an energizing vision statement, identified its considerable strengths, and established a set of values that supported and clarified its mission.
For the second and separate task, we prepared a detailed financial forecast that demonstrated how well the hospital would fare financially under several different, volume-dependent scenarios. Each scenario required a detailed cost allocation for all indirect and some direct expenses since these costs were co-mingled with costs related to the main hospital and to the faculty.
Results
We successfully accomplished the following:
- Developed a strategic planning process tailored to the hospital's needs
- Articulated the institution's mission, vision, and values clearly and concisely
- Prepared a market analysis and forecasted inpatient and outpatient demand
- Developed a strategic plan that:
- Focused on market- and patient-driven approaches to healthcare delivery
- mandated teamwork among faculty and other diverse interests
- set priorities in three categories (operations, strategic alliances, and clinical services)
- assigned target completion dates and responsible individuals to each task
- Suggested an organizational restructuring to address coordination of care and service delivery issues
- Identified ten factors critical to the hospital's continued success
- Prepared a detailed financial forecast including both occupancy and capital costs associated with the new hospital
- Identified areas of potential expense reduction and revenue enhancement to make the hospital more profitable
- Documented a method for allocating costs among the various entities sharing services.
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