House of Hearts Business Plan

Vision: To be the facility of choice for respite / symptom management of hospice patients for local and surrounding areas.

Mission: To achieve dignity, comfort and choice for people affected by a life-limiting illness, by delivering and influencing exceptional care

CONTENTS

DEDICATION………………………………………………………………………………. 3

ACKNOWLEDGEMENT………………………………………………………………. 3

CONTENTS…………………………………………………………………………………. 4

1. EXECUTIVE SUMMARY………………………………………………………….. 5

1.1. Company description…………………………………………………………….. 6

1.2. Marketing Strategy……………………………………………………………….. 6

1.3. Organizational and Management Plan…………………………………….. 6

1.4. Execution plan……………………………………………………………………… 6

1.5. Financial Forecast…………………………………………………………………. 6

2. BUSINESS DESCRIPTION…………………………………………………………. 7

2.1. PERSONAL BACKGROUND……………………………………………….. 7

2.2. INVOLVEMENT OF THE BUSINESS…………………………………… 7

2.3. NATURE OF THE COMPANY……………………………………………… 7

2.4. NAME OF THE COMPANY…………………………………………………. 7

2.5. COMPANY LOCATION AND ADDRESS……………………………… 8

2.6. START OF BUSINESS OPERATIONS………………………………….. 9

2.7. INDUSTRY……………………………………………………………………….. 10

2.8. GROWTH STRATEGY……………………………………………………… 11

2.9. JUSTIFICATION OF THE BUSINESS…………………………………. 12

2.10. GOALS OF THE COMPANY…………………………………………….. 12

CHAPTER THREE……………………………………………………………………… 13

3. MARKETING PLAN………………………………………………………………… 13

3.1. INTRODUCTION………………………………………………………………. 13

3.2. Marketing area……………………………………………………………………. 13

3.3.Target Clients…………………………………………………………………….. 13

3.5. MARKETING SHARE………………………………………………………… 16

3.6. PROMOTION…………………………………………………………………….. 17

3.7. DISTRIBUTION STRATEGY……………………………………………… 18

CHAPTER FOUR……………………………………………………………………….. 19

4. ORGANIZATION AND MANAGEMENT PLAN………………………… 19

4.1. INTRODUCTION………………………………………………………………. 19

4.3. PERSONNEL, NUMBER AND DUTIES………………………………. 20

4.4. RECRUITMENT, TRAINING AND PROMOTIONAL PROGRAM……………………………………………………………………………… 21

4.5. LICENSES, PERMITS AND BI-LAWS………………………………… 23

4.6. SUPPORTIVE PROFESSIONAL AND SERVICES……………….. 23

4.7. REMUNERATION AND INCENTIVES:……………………………… 24

CHAPTER FIVE…………………………………………………………………………. 26

5. OPERATIONAL PLAN…………………………………………………………….. 26

5.1. PRODUCTION FACILITIES AND CAPACITIES…………………. 26

5.2. PRODUCTION STRATEGY……………………………………………….. 28

5.3. REGULATIONS AFFECTING THE BUSINESS OPERATIONS…………………………………………………………………………. 29

CHAPTER SIX……………………………………………………………………………. 30

6. FINANCIAL FORECAST………………………………………………………….. 30

6.1. ASSUMPTIONS…………………………………………………………………. 30

6.2. PRE-OPERATIONAL COSTS……………………………………………… 31

6.4. BREAK-EVEN LEVELS…………………………………………………….. 31

6.7. DESIRED FINANCING………………………………………………………. 32

REFERENCES……………………………………………………………………………. 33

APPENDICES…………………………………………………………………………….. 34

CHAPTER ONE

1.     EXECUTIVE SUMMARY

Introduction

The hospice philosophy recognizes that every person deserves to live out his or her life with respect and dignity, alert and free of pain, in an environment that promotes quality of life. This concept of care came to the United States in the early 1970s, at a time when the vast majority of terminally ill people died in the hospital, often alone and in pain. From its beginnings, hospice has focused on the whole person – body, mind and spirit – with an understanding that serious illness profoundly impacts not only the patient, but family and loved ones as well.

Over the years, the medical community came to embrace hospice for bringing quality end-of-life services into the home, wherever home may be. Now, with the support of hospice professionals and volunteers, individuals may maintain control over their end-of-life choices. They do so knowing that hospice will support the patient and family in a multitude of ways.

Business Description

House of Hearts is a new hospice facility in its start-up stages. Our hospice will be located in Florence county and surrounding areas. House of Hearts will provide the people of Florence county and surrounding areas with superior quality services such as medical, psychological, and spiritual support. The goal of the care is to help people who are dying have peace, comfort, and dignity. House of Hearts will try to control pain and other symptoms so a person can remain as alert and comfortable as possible. The facility will also provide services to support a patient’s family in a very accessible location.

Industry analysis

House of Hearts competes in the hospice and palliative care industry. Hospice services are cost-effective humane and compassionate care services provided to the patients who are in the last phase of their life and have completed the medical treatment course for incurable diseases such as congestive heart failure, cancer, dementia and lung disease. These services focus on the quality of the life instead of its length so that patients may live with maximum comfort in their last days. Usually hospice services are used when a patient is left with a life of approximately 6 months or less. The services provided include pain management, home care, inpatient care, spiritual care, family gatherings, respite care and bereavement care. These services can be used at home settings, hospitals, special hospice care centers and skilled nursing facilities.

Market analysis

Hospice care market is expected to gain market growth in the forecast period of 2020 to 2027. Market analyses shows the market is likely to grow at a CAGR of 8.25%. Increasing awareness amongst the physicians and patients regarding the benefits of hospice care will help in boosting the growth of the market.

Surging volume of patients suffering from cancer, renal diseases, respiratory failure and others, increasing number of geriatric population, growing awareness among the people regarding the benefits of hospice services and care, prevalence of services from various government as well as private oriented organizations are some of the factors that will likely to enhance the growth of the hospice care market in the forecast period of 2020-2027.

Marketing plan

The hospice industry has experienced dramatic change in the past few years. One of the chief changes is the rise of private, for-profit hospices across the country. This means that hospice marketing in today’s competitive environment is of the utmost importance. In hospice marketing, the advertising content can contribute to public notions about hospice care, death, and dying. Potential strategies for successful hospice marketing, or focused on hospice referrals, where physicians function as gatekeepers for attracting new patients.

Competitive Advantage:

Hospital palliative departments are typically focused on hospice. Hospice has greater revenue and hospitals already have the infrastructure for inpatient units. However, given the lower revenue per patient and the shortage of palliative clinicians, these healthcare systems are often interested in outsourcing palliative. Offering palliative care becomes a lead-in for hospice, this will make House of Hearts a preferred provider on the discharge planner’s list for palliative and hospice and many palliative patients will become hospice appropriate.

CHAPTER TWO

2.     BUSINESS DESCRIPTION

• BACKGROUND INFORMATION

The business is operated and managed by Carmen Witherspoon, a registered nurse who worked in hospice and discovered the need for more hospice facilities. She is a highly experienced professional with a demonstrated history of success in the health sector.

• INVOLVEMENT OF THE COMPANY

Hospices and palliative care businesses have become extremely popular over the past 20 years as people take a much more compassionate look at end-of-life matters. The demand for hospice services remain strong in any economic climate given that these businesses are able to render service given that there is the inevitability that people are going to get sick and pass away. Additionally, hospices have changed their business model over the years to accommodate for more affordable situation by allowing in-home nurses to render palliative care in conjunction with that of a properly licensed physician. The usage of an actual hospice facility is now about 50% of palliative care services given that most people would prefer to pass away at home with the assistance of a nurse rather than in an inpatient facility. House of Hearts looks forward to tap this industry and not only deliver care but also we will also provide education and support to those caring for patients at the end of life.

• NATURE OF THE BUSINESS

The business will run under the management of Carmen Witherspoon because of the following:

• Demonstrated long term success in the health industry.
• Highly experienced team in Management, Leadership, and Strategy.
• Decision making for such a business requires high expertise and extensive consultation. NAME OF THE BUSINESS

The business is called House of Hearts.

• BUSINESS LOCATION AND ADDRESS

1. Location

House of Hearts will be located in Florence County.

1. Address

The business will operate under the following address

House of Hearts, Florence County.

• COMMENCEMENT OF BUSINESS OPERATIONS

The management has extensive experience in the health and palliative care industry and thus will commence as soon as all plans are complete.

The problem

Palliative care is an essential aspect in the community. Being in the medical field, Carmen realizes there is such a need for hospice facility to help patients and families manage physical pain, depression, a variety of intense emotions, the loss of dignity, hopelessness, and the seemingly mundane tasks that need to be addressed at the end of life..

The solution

In order to meet their goals and objectives, House of Hearts relies heavily on its team of dedicated clinicians. These professionals will keep the wheels turning on a day-to-day basis with support from medical specialists and the administration team. House of Hearts will provide care for people from the point at which their illness is diagnosed as terminal, to the end of their life.

Business rules and regulations

House of Hearts uses these rules:

1. Palliative care services are of priority
2. Efficiency is key to patient satisfaction

• Understanding of the patient is as important as the health of the patient.
  • INDUSTRY

The U.S. hospice market size was estimated at around USD 28 billion in 2018 and is expected to expand at a CAGR of about 9% over the forecast period. Rising elderly population coupled with increasing prevalence of chronic as well as age-associated diseases is anticipated to boost the growth. According to the Population Reference Bureau, the number of U.S. population aged 65 and above is expected to reach 95 million by 2060 from 52 million in 2018. High prevalence of cancer, dementia, and respiratory, cardiovascular, and kidney diseases among the geriatric population is projected to further drive the growth.

An increasing need for quality healthcare services at home along with increasing Medicare reimbursement for hospice care is expected to fuel the market over the forecast period. Medicare and Medicaid and other public and private organizations contribute to hospice service. According to the Federal Register, the Centers for Medicare & Medicaid Services (CMS) proposed a 2.7% increase in the payment rate of hospice for FY 2020.

• GROWTH STRATEGY

Growth is being driven primarily by the availability of patients, increasing satisfaction and efficient palliative care service delivery. This is achieved through clinicians who are experienced in palliative care and are supported by a team of qualified and experienced nurses.

House of Hearts will be:

• Coaching and Consulting to help develop and install service delivery and growth strategies. Creating a culture of growth is very important.
• Training and Education to help build skill sets, competencies and build business development and sale staff “muscle”
• Strategic planning which employs a Hoshine method of planning and which is new to health care.
• Program Development such as Palliative Care, better use of GIP and the like.

JUSTIFICATION OF THE BUSINESS

The research carried on the area justify the suitability of Florence County and surrounding areas for the intended hospice business. This is due to the following reasons;

1. Demand: There is high and on the rising demand for hospice services in Florence county and surrounding areas.
2. There is only one Hospice facility in Florence County.
   • Critical Success Factors

The critical success factors in the industry are:

Location: Patients can easily distinguish House of Hearts from others in Florence county and surrounding areas.

Service factors: One of the primary drivers of excellent service that offers palliative care services.

Remote support: Our clients enjoy 24/7 customer support to help them deal with palliative and hospice related issues.

Price: Price is a critical factor that clients consider in ascertaining the overall value of an offering. Understanding what the patient is being asked to forego in exchange for what they get, is the key to our ability to deliver superior value.

Annual sales and market sales

The following steps will be taken to estimate annual sales.

Step 1: Determine the number of annual patients House of Hearts will have.

House of Hearts target is 25% of patients in Florence county and surrounding areas within 12 months of operation.

Step 2: Based on the 25% of patients, what will House of Hearts annual sale be?

We are projecting 35% growth at the end of 2020, followed by a 45 % growth after that.

• Marketing Objectives

• Combining hospice and palliative care.
• Having a competitive edge: by offering counselling and support to our patients and their families.

GOALS OF THE BUSINESS

1. Maximize profit and satisfy clients and their needs
2. Win families and patients’ loyalty
3. Provide the best and quality services to our patients
4. To increase company growth by 30%.

CHAPTER THREE

3.     MARKETING PLAN

• INTRODUCTION

Marketing our service-oriented business requires establishing a reputation for expertise and excellence. It starts with our known contacts who are in positions to recommend us and make referrals to us, and continues with long-term efforts to develop recognition among other professionals within the hospice facility fields.

Carmen Witherspoon is already well-known to physicians, other nurses and hospice facilities in our market area, and will work to maintain those relationships throughout our start-up process. Carmen Witherspoon will make initial contacts in the community as she establishes the business entity and provider status with House of Hearts, and local networks. Our communications will be professional, as will our marketing tools such as brochures, business cards, advertisements, face to face meetings, social media and online platforms.

Marketing area

Marketing areas will be selected according to the availability of patients. For example, since House of Hearts operates on hospice and palliative care service, the targeted market should be the availability of patients around Florence county and surrounding areas. This will lay the basis for our marketing initiative. House of Hearts will be in the business of providing in patient hospice services that allow terminally ill people to pass away in a comfortable environment with round the clock medical support. The company will employ a number of on staff nurses and contracted health professionals to ensure that the patients are tended to properly. Outsourced healthcare professionals include pain management physicians, pharmacists, and mental healthcare professionals.

• MARKETING SHARE

Research suggests that competitors take 90% of share in the total market area in Florence county and surrounding areas. House of Hearts looks forward to changing these figures and occupies 45% in a year with a target market share up to 65% in Florence County and above 75% market share in surrounding areas. This can be executed through the right advertising blend, which includes;

• Flexible pricing of service rates.
• Highly effective service delivery.

This could be done with the intention of retaining and enhancing market share, assembly opposition, maximizing income, reaching targets return on investment, and for survival.

• Marketing

This can be achieved through creation of online resources that portray the kind of services that we offer and publishing them across online platforms where there are families and patients who might need our services and convincing them that our services are only the great in phrases of rate, choice and convenience. Also, can be achieved through referrals made by physicians, families and friends.

• Social media marketing

This will involve the sharing of services through different social media platforms to reach more patients. For example, through Facebook Pages, Twitter, Instagram and WhatsApp showing our services.

CHAPTER FOUR

4.     ORGANIZATION AND MANAGEMENT PLAN

• INTRODUCTION

Five guiding principles support our vision:

• Satisfaction: working together for a common cause,
• Teamwork: working together for a common purpose,
• Growth through efficient provision of palliative services,
• Accountability: delivering on commitment,
• Diversity bridges cultural gaps enhances collective wisdom, and improve reliance, and
  • PERSONNEL, NUMBER, AND DUTIES

General Advisory Board

1. Manager

Primary Role: To provide advice for service delivery to increase efficiency.

2. Finance manager

Primary Role: To provide advice on service selection and to help shape House of Hearts’ approach towards finances and expenditure in the hospice industry.

Public Relations

Primary Role: To provide advice on P.R. marketing campaigns and growing clients trust.

Organizational Chart

House of Hearts wants everyone to play a pivotal role in service delivery. We intend to remain as customer-centric as possible to hasten the decision-making process and to react promptly to urgent and emergency calls.

• RECRUITMENT, TRAINING AND PROMOTIONAL PROGRAM

1. Recruitment

This will be done to identify the right and qualified and registered workforce from the hospice industry. It will be done in different ways, like:

• Oral interviewing
• Hands on experience-based

This process is also aimed at improving the productivity and palliative care service delivery.

1. Promotion

Health workers and any other employee in the company who work hard towards the success of the company shall be rewarded.

LICENSES AND BI-LAWS

(a) License

Licenses will give authority to operate within Florence county and surrounding areas.

(b) Bi-laws

The business will use bi-laws during its operations.

• REMUNERATION AND INCENTIVES:

The business shall use the following remunerations:

• Salary schedule:

The salaries shall vary with one’s position and responsibilities.

• Incentives

The nurses shall enjoy incentives such as overtime payments and holiday bonuses in the hospice as a way of motivating them.

CHAPTER FIVE

5.     PRODUCTION AND OPERATIONAL PLAN

• PRODUCTION FACILITIES AND CAPACITIES

1. Capital

The business source of finance will be from:

• Savings
• Owners’ equity
• Investments

1. Labor

The business has a capacity to employ enough support staff like nurses and therapists who are passionate about their jobs and ensure not to endanger our clients’ lives and strive to make House of Hearts the number one in our selected niche. They provide excellent hospice and palliative care service delivery and marketing services. They also have the following skill

• Communication skills to transfer information regarding our services to patients.
• Technical skills. This helps them to know about the health related service.

The business operates in Florence County.

• Technology

House of Hearts shall use secure and reliable House of Hearts services platforms as per the needs of the clients to ensure efficiency and ease their experience effectively.

• PRODUCTION STRATEGY

House of Hearts shall use production techniques such as combining care with holistic wellness and non-invasive options to market its services.

The palliative care service provision practice shall comply with the criteria as proven beneath

1. Determining the service and offerings within which patients will be reached.
2. Determine the importance of the service inside the location
3. Developing a larger picture relating to the patients’ preferences.

5.3 SWOT ANALYSIS

The SWOT Analysis that was conducted for House of Hearts Hospice is summarized as below:

• Strength

Top on the list of what we will count as our strength is that we have a team of well qualified professionals manning various job positions in our organization. As a matter of fact, they are some of the best hands in the whole of Florence County. Our location, the Business model we will be operating on, well equipped facility and our excellent customer service culture will definitely come to the fore and position us to stay highly competitive.

Also Carmen Witherspoon has the adequate qualifications and experience in the hospice industry.

• Weaknesses

House of Hearts is a new business which is owned by an individual, and we may not have the financial muscle to expand our facility within a short term therefore, we will be limited on the number of residents we can accommodate 14 clients within the first year of opening our facility.

• Opportunities

According to the National Hospice and Palliative Care Organization, as of 2020 (latest data available), 83.4 percent of patients in hospice and palliative care centers are over the age of 65. As this demographic expands, demand for industry services will likely also grow.

The number of adults in this age group is expected to increase going forward, presenting a potential opportunity for the industry. We are going to position our business to make the best out of the opportunities that will be available to us.

• Threat

Many patients that do not qualify for Medicare or Medicaid are eligible for hospice coverage under private insurance. Although the vast majority of hospice recipients do qualify for Medicare or Medicaid, an increase in the availability of private health insurance can have a positive impact on demand for industry services.

The number of people with private health insurance is expected to increase in the coming year. However, volatility surrounding health insurance policy poses a potential threat to the industry. Another threat that may likely confront us is the arrival of a new and bigger facility in same area where ours is located.

CHAPTER SIX

6.     FINANCIAL PLAN

This includes figuring out the route of action to reap the desired effects. It ensures financial operations, improves motivation, and helps manage through decreasing uncertainties.

• ASSUMPTIONS

1. Salaries will remain steady for the first three years of operations however will appreciate yearly via 3% from the fourth year of activity
2. Palliative care service delivery will appreciate with 10% especially after the Covid-19 pandemic.

Sales Forecast

One thing is certain, there would always be people citizens with one form of life terminating illness or the other who would need the services of a hospice facility. We are well positioned to take on the available market in Florence County and we are quite optimistic that we will meet our set target of generating enough income / profits from the first six months of operation and grow our business and our resident base.

We have been able to examine the senior scare facility services market and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the sales projection for House of Hearts, it is based on the location of our business and of course the wide range of related services that we will be offering;

First Fiscal Year: $100,000 (From Self – Pay Clients): $250,000

Second Fiscal Year: $250,000 (From Self – Pay Clients): $500,000

Third Fiscal Year: $500,000 (From Self – Pay Clients): $1,500,000

N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown and natural disasters within the period stated above. Please note that the above projection might be lower and at the same time it might be higher.

Our Pricing Strategy

House of Hearts will work towards ensuring that all our services are offered at highly competitive prices.

On the average, hospice and palliative care facility, nursing homes, senior care facilities and group home facility service providers usually leverage on the fact that a good number of their clients do not pay the service charge from their pockets; private insurance companies are responsible for the payment. In view of that, it is easier for these providers to bill their clients based in their discretion.

Be that as it may, we have put plans in place to offer discount services once in a while and also to reward our loyal residents especially when they refer clients to us.

• START-UP BUDGET

Payment Options include, bank transfer, online bank transfer, bankers cheque, mobile money and cash transactions.

The items listed below are the basics that we would need when starting our hospice and palliative care facility business in the United States;

The total fee for registering the business in the United States of America                        – $750.

Legal expenses for obtaining licenses and permits                                                    – $1,500.

Marketing promotion expenses for the grand opening of House of Hearts in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of – $3,580.

The cost for hiring Consultant                                                                                   – $2,500.

The cost for the purchase of insurance (general liability, workers’ compensation and property casualty) coverage at a total premium                                                             – $3,400.

The cost for leasing a standard and secured facility in Florence County for 2 years – $250,000

The cost for facility remodeling                                                                                – $50,000.

Other start-up expenses including stationery ($500) and phone and utility deposits – ($2,500).

Operational cost for the first 3 months (salaries of employees, payments of bills et al) – $100,000

The cost for start-up inventory (stocking with a wide range of products such as toiletries, food stuffs and drugs et al)                                                                                                            – $50,000

Cost for the purchase of storage hardware (bins, rack, shelves,)                               – $3,720

The cost for the purchase of furniture and gadgets (Beds, Computers, Printers, Telephone, TVs, tables and chairs et al):                                                                                        -$4,000.

The cost of launching our official website:                                                               -$700

Miscellaneous:                                                                                                            -$10,000

We would need an estimate of seven hundred and fifty thousand dollars ($750,000) to successfully set up our hospice and palliative care facility in Florence County.

Projected Profit & Loss

Projected Balance Sheet

Projected Cash Flow Statement