Transcript Elements of a Business Plan - Ensuring Financial Viability for an Eye

Leadership
Core
Services
Community
Support
Financial
Self
Sufficiency
Programme
Design
(leading to
model
development)
Building
capacity
(Infrastructure
& HR)
Commitment
by
Leadership
Finances
(internal &
external)

Gap analysis:
 Assess unmet need in the community
 Assess current utilization of Infrastructure and
Resources

Set Targets:
 Based on community need
 Lead to optimum utilization


Strategic approaches to achieve targets
Financial viability: what it takes to provide
services/achieve targets and how to meet
the expenditure
Assumptions about the environment
 Assumptions about the Mission
 Assumptions about the core
competence

Applying it to the “Present” and “Future”
Relevance
 Standardisation of processes and
protocols
 Ensure service uptake levels
 Quality of diagnosis & treatment
 Patient comfort
 Outcome

Helps in:
 Instrumentation
 Training
 Patient flow
 Quality improvements
 Patient’s understanding & co-operation
10
Performance
 Addressing challenges
 Monitoring changes & variations
 Review effectiveness of the strategies &
introduce necessary changes to
programme implementation

Cost Containment
Improve
Resource
Utilization
e.g. Surgeries/Surgeon
Operations/bed/year
Fixed
Cost
Revenue Generation
Implement
Low-cost
Technologies
Self
Generated
e.g. Sutures, Eye
drops, IOL/Specs,
Maintenance
e.g. Rich patients,
Support services,
Spectacles
e.g. Govt,
Local NGO,
Community
e.g.
Multilateral,
Bilateral, INGO
Patient
Generated
Revenue
Subsidy
National
Subsidy
Other
countries
Variable
Cost
Other
Sources
Subsidy/Donation
Self-reliance
Continually refine pricing &
management processes
Sustainability Process
Ext. Dependence
Diversify the
portfolio
Revenue > Cost of eye care services
 Maximize
Revenue
Tension: Social obligation
 Minimize
costs
Tension: Quality & Patient Satisfaction
Scale: Investment in infrastructure, size of
the facility and staffing are the major
determinants
 Efficiency

 Optimum utilization of the infrastructure
 Seasonal variations in patient load
 Staffing & Staff utilization pattern
 Productivity

Logistics driven
 good inventory management
 group purchasing for better price
 Good materials management (reduce
wastage in storage & pilferage)

Cost engineer your clinical protocol
 Eliminating unnecessary investigations,
procedures & medications
Hospital’s perspective:
 Hospital Charges
 Medication ??
Patients’ perspective:
 Cost of care
 Transportation
 Food
 Lost wages
 Cost of
accompanying person
 Family visits
 Follow-up visits
 Restrictions
Location: 80 km, west of Madurai
Service area population
• Theni District
: 1 million
• City Population : 111,500
• Kerala districts : 3.2 million
55% of population in rural area
Total Beds: 63 + 100
• Paying
: 40 (22 %)
• Free walk-in : 23
• Camp
: 100
Services offered:
Cataract; Refractive Errors;
Glaucoma; Medical Retina &
Lasers
Human Resources:
Ophthalmologists
Residents
Clinical staff
Administrative staff
:2
:7
: 37
: 29
Patient Fee Strucutre (US$):
OP Consultation:
Paying: 1.00; Walk-in: Free
Cataract:
• Camp: US$ 0 (- US$ 6)
• Subsidized: US$ 17
• Paying: US$ 30 - $ 380
All Financial figures are in US$
Paying
Cataract Surgeries
Fixed Costs
Variable Costs
Total Cost
Unit Cost
Fee/Subsidy per case
Contribution per case
Total Surplus
2,008
$ 150,630
$ 40,965
$ 191,595
$ 95
122
$ 27
$ 54,216
Free Hospital
Camp
Subsidised
1,841
3,707
$ 10,958
$ 10,958
$6
12
$6
$ 11,046
32%
Total
7,556
$ 150,630
$ 35,305 $ 87,228
$ 35,305 $ 237,858
$ 10
$ 32
14
$4
$ 14,828 $ 80,090
Capital cost: Cost of Land, Building, major
equipment, etc
 Recurring cost: Ongoing cost of providing
the services

 Fixed Cost: Costs that have to be incurred
regardless of the level of activity
 Variable cost: Costs that vary directly with the
level of activity

Unit cost: (Fixed cost + variable cost) per
unit of service