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Hospital Business Plan
Starting a hospital is a huge responsibility because taking care of millions of people in a year is difficult. If you are considering starting a hospital, then staffing, financial and business planning are necessary, for which a business plan is vital.
Need help writing a business plan for your hospital business? You’re at the right place. Our hospital business plan template will help you get started.
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- Fill in the blanks – Outline
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How to Write A Hospital Business Plan?
Writing a hospital business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:
1. Executive Summary
An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready and summarizes each section of your plan.
Here are a few key components to include in your executive summary:
Introduce your Business:
Start your executive summary by briefly introducing your business to your readers.
Products and services:.
Highlight the hospital services you offer your clients. The USPs and differentiators you offer are always a plus.
Marketing & Sales Strategies:
Financial highlights:, call to action:.
Ensure your executive summary is clear, concise, easy to understand, and jargon-free.
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2. Business Overview
The business overview section of your business plan offers detailed information about your business. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:
Describe your business in this section by providing all the basic information. Describe what kind of hospital you run and the name of it. You may specialize in one of the following hospital businesses:
- General hospitals
- Specialty hospitals
- Teaching hospitals
- Children’s hospitals
- Outpatient clinics
- Rehabilitation hospitals
- Maternity hospitals
- Describe the legal structure of your hospital, whether it is a sole proprietorship, LLC, partnership, or others.
- Explain where your business is located and why you selected the place.
If you’re an established hospital, briefly describe your business history, like—when it was founded, how it evolved over time, etc.
This section should provide a thorough understanding of your business, its history, and its future plans. Keep this section engaging, precise, and to the point.
3. Market Analysis
The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.
Start this section by describing your target market. Define your target market and explain what types of services they prefer. Creating a buyer persona will help you easily define your target market to your readers.
Analyze emerging trends in the industry, such as changes in patient behavior or preferences, etc. Explain how your business will cope with all the trends.
Here are a few tips for writing the market analysis section of your hospital business plan:
- Conduct market research, industry reports, and surveys to gather data.
- Provide specific and detailed information whenever possible.
- Illustrate your points with charts and graphs.
- Write your business plan keeping your target audience in mind.
4. Products And Services
The product and services section should describe the specific services and products that will be offered to patients. To write this section should include the following:
Describe your facilities:
Mention the hospital facilities your business will offer. This list may include,
- Intensive care
- Neonatal care
- You can also mention the number of beds & specialized units
This section should explain how you maintain quality standards and consistently provide the highest quality facility.
In short, this section of your hospital plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.
5. Sales And Marketing Strategies
Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:
Unique Selling Proposition (USP):
Define your business’s USPs depending on the market you serve, the equipment you use, and the unique services you provide. Identifying USPs will help you plan your marketing strategies.
Sales strategies:, testimonial and success stories:.
Overall, this section of your hospital business plan should focus on patient acquisition and retention.
Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your hospital business, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.
6. Operations Plan
The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:
Staffing & Training:
Operational process:, equipment & machinery:.
Include the list of equipment and machinery required for the hospital, such as operating rooms, tables, surgical lasers, surgical drills & saws, vital signs monitors, etc.
Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.
7. Management Team
The management team section provides an overview of your hospital business’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.
Introduce your management and key members of your team, and explain their roles and responsibilities.
Compensation plan:, advisors/consultants:.
Mentioning advisors or consultants in your business plans adds credibility to your business idea.
This section should describe the key personnel for your hospital, highlighting how you have the perfect team to succeed.
8. Financial Plan
Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:
Profit & loss statement:
Cash flow statement:, balance sheet:, break-even point:.
Determine and mention your business’s break-even point—the point at which your business costs and revenue will be equal.
Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.
The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.
- Add a table of contents for the appendix section to help readers easily find specific information or sections.
- In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more. These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
- Provide data derived from market research, including stats about the industry, user demographics, and industry trends.
- Include any legal documents such as permits, licenses, and contracts.
- Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.
Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.
Remember, the appendix section of your healthcare business plan should only include relevant and important information supporting your plan’s main content.
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This sample hospital business plan will provide an idea for writing a successful hospital plan, including all the essential components of your business.
After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our hospital business plan pdf .
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Frequently asked questions, why do you need a hospital business plan.
A business plan is an essential tool for anyone looking to start or run a successful hospital. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.
Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your hospital.
How to get funding for your hospital business?
There are several ways to get funding for your hospital, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:
Small Business Administration (SBA) loan
Crowdfunding, angel investors.
Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.
Where to find business plan writers for your hospital?
There are many business plan writers available, but no one knows your business and ideas better than you, so we recommend you write your hospital business plan and outline your vision as you have in your mind.
What is the easiest way to write your hospital business plan?
A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any hospital business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software .
About the Author
Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more
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Healthcare Business Plan Template
Written by Dave Lavinsky
There are several types of Healthcare businesses, from family medicine practices to urgent care centers to home health care agencies. Regardless of the type of healthcare business you have, a business plan will keep you on track and help you grow your healthcare business in an organized way. In addition, if you plan to seek funding, investors and lenders will use your business plan to determine the level of risk.
Download our Ultimate Business Plan Template here >
Below is the business plan outline you should use to create a business plan for your healthcare company. Also, here are links to several healthcare business plan templates:
- Assisted Living Business Plan
- Counseling Private Practice Business Plan Template
- Dental Business Plan
- Home Health Care Business Plan
- Medical Practice Business Plan Template
- Medical Spa Business Plan Template
- Non Medical Home Care Business Plan Template
- Nursing Home Business Plan Template
- Pharmacy Business Plan
- Urgent Care Business Plan
Finish Your Business Plan Today!
Healthcare business plan example outline, executive summary.
Although it serves as the introduction to your business plan, your executive summary should be written last. The first page helps financiers decide whether to read the full plan, so provide the most important information. Give a clear and concise description of your healthcare company. Provide a summary of your market analysis that proves the need for another healthcare business, and explain your company’s unique qualifications to meet that need.
Your company analysis explains your healthcare business as it exists right now. Describe the company’s founding, current stage of business, and legal structure. Highlight any past milestones, such as lining up clients or hiring healthcare providers with a proven track record. Elaborate on your unique qualifications, such as expertise in a currently underserved niche market.
The healthcare industry is incredibly large and diverse, but your analysis should focus on your specific segment of the market. Do you specialize in pediatric healthcare? senior healthcare? emergency medicine? family medicine? Figure out where your healthcare company fits in, and then research the current trends and market projections that affect your niche. Create a detailed strategy for overcoming any obstacles that you uncover.
Who will your healthcare company serve? Are they families? The elderly? What is important to them in a healthcare business? How do they select a healthcare provider? Narrow down their demographics as closely as you can, and then figure out what their unique needs are and how you can fulfill them.
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Your direct competitors are those healthcare companies that fulfill the same needs for the same target market as yours. Your indirect competitors are healthcare businesses that target a different market, or other companies that fulfill a different need for your target market. Describe each of your direct competitors individually, and talk about the things that set your healthcare company apart. Categorize your indirect competitors as a group and talk about them as a whole.
A solid marketing plan is based on the four P’s: Product, Price, Promotion, and Place. The Product section describes the healthcare you sell along with any other services you provide. Price will change according to the specifics of the property, but you can delineate your fees here. Promotion is your means of getting new business. Place is your physical office location, along with your web presence and the areas where you sell. Another category, Customer retention, refers to the ways you will build loyalty.
Your operations plan explains your methods for meeting the goals you set forth. Everyday short-term processes include all of the daily tasks involved in servicing clients. Long-term processes are the ways you will meet your defined business goals, such as expanding into new markets or new types of service.
The management team section highlights the backgrounds of the key members of your team. Focus on those aspects that prove your team’s ability to build and run a successful company. A business mentor or advisor can help fill in any gaps, provided you can identify the specific ways that your advisor will influence your company’s growth.
Investors and lenders heavily scrutinize the financial plan, but it is often the most challenging part of the business plan to write. Healthcare is a strong market, it usually not subject to economic turns. The financial plan requires you to detail your individual revenue streams by implementation timeline and relative importance, and disclose any sources of outside funding. You also need to summarize your past and future Income Statements, Cash Flow Statements, and Balance Sheets, based on key assumptions that must be both reasonable and verifiable based on an analysis of similar companies. You should also provide a solid exit strategy that shows your understanding of the market and your desire to capitalize on profitability.
Your full financial projections should be attached in the appendix along with any other documents that support your claims, such as letters from key partners.
Healthcare Business Plan FAQs
What is the easiest way to complete my healthcare business plan.
Growthink's Ultimate Business Plan Template allows you to quickly and easily complete your Healthcare Business Plan.
What is the Goal of a Business Plan's Executive Summary?
The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of healthcare business you are operating and the status; for example, are you a startup, do you have a healthcare business that you would like to grow, or are you operating a chain of healthcare businesses?
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Other Helpful Business Plan Articles & Templates
How to Write a Business Plan for an Outpatient Medical Practice
16 min. read
Updated November 13, 2023
Free Download: Sample Medical Practice Business Plan Template
So you’re thinking about starting your own outpatient medical practice.
You probably have many good reasons to open a private practice. Private practices can be lucrative, although it requires you to spend time building relationships with patients while also attending to all business processes that are part of running your practice .
Maybe you want more autonomy over your practice and your workflow. Or maybe you hope to expand your services to underserved areas or specific populations based on your expertise.
If you’re thinking about starting an outpatient medical practice, one of the first things you should do is write a business plan. Even if you’re able to self-fund your practice and don’t need outside investment, your business plan is a great tool for thinking through all the different aspects of building a profitable and sustainable practice.
You should go into this thinking about your business plan as a living document, not something you do once and then file away forever. Use it as a tool, especially around your financials. Revisit and update it regularly by comparing your forecasts to your actuals and adjusting as necessary.
To help you get started, you can download our free business plan template . If you’ve never written a business plan before, Bplans also offers a library of sample medical business plans that you can review or even download to use as a model.
- Executive summary
The first section that will appear in your business plan is the executive summary . But before you dive right in, it’s the section of your plan that you should actually write last. It’s a summary and an overview of your outpatient medical practice and your plans, so it will be easy to put together after you’ve written the rest of your plan.
Executive summaries are short—keep it to one to two pages. Keep in mind that if you’re using your plan to get funding, investors and banks tend to read your executive summary to get a sense of whether to read on and consider your request. Do not neglect it; just write it last.
Your executive summary will include the following sections:
- Who you are: Your business name, location, and contact information.
- What you offer and the problem your business solves: What does your practice offer and why is it needed? This is your value proposition .
- Target market: Who is your ideal patient? Do they self-pay or use insurance? Be specific.
- Competition: Who else is offering similar services?
- Team: Who is on your management team?
- Financial summary: Explain your business model, startup costs, revenues, and liabilities to the company. Mention your funding needs.
- Milestones and traction: How have you validated that there’s a need for your practice in your location?
- Position your practice’s business opportunity
Now that you’re familiar with what’s included in your executive summary, tuck that information away, and get to work on the rest of your plan.
What’s your biggest business challenge right now?
Think of the next few sections of your plan as the overarching description of your practice’s business opportunity. You’ll cover the problem you’ve identified and the solution that your practice offers. Then you’ll think through your ideal customer , your competition , and your opportunities for growth . This section area should describe the services you provide and how they benefit your patients.
- Problem and solution
First, describe the problem that you’ve identified and how your practice solves that problem. Here’s a brief example:
The problem : There is a lack of affordable pediatric and gynecological care available in coastal areas of Lane County, Oregon. Many patients have to travel miles to the closest practice.
The solution : Dr. Gardner plans to open Ocean Lane Outpatient Care to serve smaller Oregon coastal communities scattered outside of major towns with major hospitals. Due to her focus on pediatric and gynecological care, Dr. Gardner’s particular services are especially valuable in this location due to the lack of available service providers in the area. Dr. Gardner’s practice will accept private insurance and Medicaid, as well as a sliding scale for patients in a certain income bracket.
The services section identifies what kind of medical practice you are opening. Restate who your practice serves and what kind of services you specialize in. Talk about how your practice approaches treatment and what goals you have in addition to providing quality care. Here’s an example from a sample business plan for a medical practice.
Include a breakdown of all services furnished by the clinic, being as granular as possible. For example:
- Annual women’s wellness exam
- Youth eating disorder treatment
- Target market
Next, talk about your ideal patients. If you’re in the earliest stages, you’ll want to do some research that verifies your hypotheses.
For example, Dr. Gardner would have needed to verify her assumption that people in coastal towns in Oregon are in need of pediatric and gynecological services—a need that isn’t currently satisfied by available resources.
A formal market analysis can help verify that there’s a need for your particular practice in your intended location.
Your target market section should include:
- TAM, SAM, and SOM: Total Available Market (TAM), Segment of the Available Market (SAM), Share of the Market (SOM). Here, you are looking at the difference between targeting everyone: TAM (all people who need medical care—so all humans in your area), versus your ideal clients: SAM (maybe this is those with certain insurance or ability to self-pay), versus the number of new patients you think you can realistically reach: SOM, especially within your first few years. The idea is that not everyone will be an ideal patient. It matters because you can waste a lot of money with marketing outreach to everyone, instead of targeting a specific population that is more likely to be looking for your services.
- Buyer persona : Imagine there’s one specific patient who represents your ideal patient. Be specific. Maybe she’s 34 years old, has private insurance, is relatively healthy, but needs more regular medical care and advice.
- Competition and competition matrix : List competitors and analyze what makes them competitive. For instance, your competitors might be large hospitals because of the wide range of services they offer. You might also be competing with local chiropractors or other alternative medicine practices that already have a foothold in local communities.
- Future products and services : Name the products/services you will offer as your practice grows and earns more money and as your patients develop new needs. Maybe you will want to open a second location when you gain enough patients. Or maybe you will want to extend your practice’s hours of operation.
Ideal patient profile
Your ideal patient profile identifies the type of patient whom you hope to attract and retain. To clarify, this does not mean you only serve your ideal patient type. Rather, focusing your outreach efforts on attracting your ideal patient will allow you to grow your practice more effectively than targeting a large number of patients who may or may not be in the market for your practice’s specialty.
When developing your ideal patient profile, consider:
- Who you enjoy working with
- Who needs the services you provide
- Who can and will pay your pricing (or have an insurance plan that you want to accept)
For instance, because Dr. Gardner specializes in preventive and curative care, a patient seeking palliative treatment for terminal cancer is not the ideal patient. This patient would not receive the best care for their needs from Dr. Gardner’s services.
Acquiring a new patient is six to seven times more expensive than retaining a current patient. In order to support and retain current patients, develop a strategy to proactively meet their needs and set benchmarks to measure the success of your strategy.
- Execution: How your practice will respond to the opportunity
First, your business plan laid out the opportunity at hand. Now, the rest of your plan will focus on how to take advantage of that opportunity. Now is the time to lay out what you’ll do to attract patients and set up a viable business model with healthy financials.
Components of this section include:
- Your marketing and sales plan
- Strategic partnerships or alliances
- Your operations plan
- Your team and company information
- Financial plan
- Milestones and metrics that you’ll need to hit to be viable
- Your key assumptions and risks
- Your funding ask and exit strategy, if applicable
- Marketing and sales plan
The marketing and sales component of your plan should include how you plan to reach the patients in your target market, how you’ll bill for your services, and what you need to do to bring in the right number and type of patients.
- Positioning : Describe how you will present your company to your customers with your positioning statement . Think about answering these questions: What are you offering your patients that they can’t get elsewhere? Why should they pick you instead of another practice? Where do you see yourself in the competitive landscape? Use this model to help:
“For [target market description] who [target market need], [how our business offering meets the need]. Unlike [key competition], it [most distinguishing feature].”
For [coastal community members] who [require gynecological care], Ocean Lane Outpatient Care [provides both pediatric and women’s health services]. Unlike [other area medical practices], Ocean Lane Outpatient Care is [conveniently located near the communities it serves and can fill the gap between pure pediatric care and full-blown adult care for young women].
- Pricing and billing : Medical pricing is complex, especially if you plan to work with insurance companies. Practice Builders says that “a 10 percent increase in pricing can result in a much better return than a 10 percent reduction in costs—or even a 10 percent increase in patient volume.”
Make sure you price your services at what they are worth and explain your pricing to your patients. Consider the demographics your practice serves when you choose your pricing. Research other practices in the area and learn more about how you can choose the best prices for your patients and your practice.Also, consider how you will get patients to keep coming back to your practice. Sometimes you can increase sales by upselling and cross-selling , or offering complementary services.
If you accept insurance, the contracts you set up with insurance companies for reimbursement will probably dictate your pricing, so this is a good place to talk about your negotiation strategy as well.
- Update your website and social media frequently and ensure your website is mobile-friendly and share-friendly with credible links added.
- Make sure all communications with and about patients are HIPAA-compliant . Download a HIPAA Compliance Guide to ensure you are following regulations.
- Maintain a positive online reputation for your practice as a key management technique. You can do this by claiming your profile on any third-party sites that list it. Encourage your patients to review you online, too.
- Strategic alliances : List any people or organizations with whom you are working. You will most likely need to partner with a regional lab for medical testing. Opening an on-site lab can be costly for a smaller practice. You will most likely need to partner with a nearby hospital as part of a referral system or to share select services and equipment.
The operations section of your business plan covers how your business works, from the logistics to the technology.
- Technology: Describe how your technology works, but do not go into too much detail. Investors can ask for more information if they want to. Will you rent or buy equipment ? The technology you need ranges from simple items like thermometers to more complex items like centrifuges.
- Billing and information storage: Provide a brief overview of how you will manage information technology and patient records to promote safety, efficiency, and compliance with HIPPA regulations and industry standards. Explain your usage of Electronic Medical Record (EMR) software in this section.
- Payment types you accept: Consider payment types such as private pay, private insurance, Medicaid/Medicare, etc. What kind of referrals can you offer to the uninsured or those who cannot afford your services?
- Milestones and metrics
In this part of your plan, you set measurable, achievable milestones, such as the number of new patients added per month in the first year of operations. Milestones can be about any aspect of your medical practice as long as they emphasize growth. For metrics , decide which numbers to check regularly to track your company’s health. This area should also include information about traction (past successes) and risks:
- Traction: Look back at major milestones you have achieved. Hopefully, they demonstrate that your business model works and that you are filling a need for your market. If you’re looking to attract private funders, this section is important since it shows your initial success .
- Key assumptions and risks : Acknowledge the assumptions you are basing your business on. Set out to prove them right if you can. Also, discuss risks so that investors know you have considered what could go wrong and that you have a plan for dealing with challenges. Malpractice suits and changing healthcare regulations are risks specific to the healthcare field. Malpractice insurance is a must for addressing the former. Changing healthcare regulations can affect the volume of patients who are able to afford your services.
Your team can be more important than your product or service. Describe your team here, even if it is just you and a receptionist who answers the phone in your office building.
- Management team and qualifications: Address who works for you, what do they do, and how much you pay them. Compile the details of their relevant experience and education.
- Hiring plans : Outline who, if anyone, you need to hire to fill skills gaps in your management team and how much you plan to pay them.
- Company overview
The company overview tells about who you and your staff are and appeals to potential investors. Keep it short—it should be the shortest chapter of your business plan but is still very important.
It needs to include these elements :
- Mission statement : Your mission statement articulates your goals for what your company does for its customers, employees, and owners. It will read something like this: “Our mission is to provide X (services) for Y (customers) by Z (methods).” For instance, Ocean Lane Outpatient Care is dedicated to providing quality care for all the inhabitants of coastal Lane County by providing affordable and versatile services.”
- Intellectual property : List any patents you have or have pending, and mention any core technology you are licensing from another company.
- Legal structure and ownership : Explain your business structure and who owns how much of it. More on considerations for physicians and legal structure here.
- Business location : Describe the company’s location and any facilities it owns.
- Company history if it’s an existing company
Having a solid financial plan is critical, whether you’re seeking funding or not. A typical financial plan includes projections by month for the first year and annual projection for the next three to five.
Include these key elements:
- Profit and loss statement : this explains how your business made a profit or incurred a loss in a given amount of time (typically three months) by listing all revenue and expenses, then documenting the total amount of net profit or loss.
- Cash flow statement: documentation of how much cash the business brought in, how much it paid out, and the amount of its ending cash balance (on a monthly basis).
- Balance sheet : snapshots how your company is performing at a given moment by including how much money you have in the bank, how much your customers owe you, and how much you owe your vendors.
- Sales forecast : projections of what you think you will sell in a given timeframe (one to three years).
- Business ratios : Comparisons of your company’s financials with numbers from the industry profile.
- Keep it brief. For example, Dr. Gardner will employ administrative aides and nurses.
- Use of funds : Needed if you’re seeking investment or a loan. This section explains how you will use investors’ money.
- Exit strategy : You only need this if you’re seeking outside investment. An exit strategy is a method by which entrepreneurs and investors, especially those that have invested large sums of money, transfer ownership of their business to a third party to recoup money invested in the business. Common exit strategies include being acquired by another company, the sale of equity, or a management or employee buyout.
When writing your financial plan, make sure to consider startup costs . For a medical practice, average startup costs can include initial fees, malpractice insurance, cost of renting or leasing office space, and the cost of any legal or tax advisors.
Consider submitting your plan to at least five to 10 banks if you need help financing your startup costs. Many banks have divisions designated to providing loans to new dental and medical practices , so submit your plan to that division if you can. Startup costs can be high in the medical field, so make sure not to underestimate them.
Finally, your appendix is the holder for any supporting information such as charts, images, graphs, and more. If you need to include large sets of data or pages of information, put it here. That way, it is available but does not distract from the plan’s most important pieces.
For instance, you can expand on your personnel plan with charts of each employee’s annual insurance costs. You can also include versions of your profit and loss statements and other financials that extend further into the future.
Don’t forget to go back to your executive summary! Remember to keep it brief and write it based on what you have written already.
When you’re ready to write your business plan, there are an array of resources available to you. Download our free business startup checklist to think about the next steps. Also, check out our free business plan template . Reviewing sample business plans in the medical field can help you get a better sense of the process and information you’ll provide. This one for a family medicine clinic will probably be most helpful if you’re setting up a primary care practice.
Remember that this plan is a living document. Schedule a regular business plan review meeting. You should review your trajectory and compare your financial projections to your actuals frequently to keep your practice on track.
See why 1.2 million entrepreneurs have written their business plans with LivePlan
Noah is currently the COO at Palo Alto Software, makers of the online business plan app LivePlan.
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Medical Business Plan
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The future of healthcare: Value creation through next-generation business models
The healthcare industry in the United States has experienced steady growth over the past decade while simultaneously promoting quality, efficiency, and access to care. Between 2012 and 2019, profit pools (earnings before interest, taxes, depreciation, and amortization, or EBITDA) grew at a compound average growth rate of roughly 5 percent. This growth was aided in part by incremental healthcare spending that resulted from the 2010 Affordable Care Act. In 2020, subsidies for qualified individual purchasers on the marketplaces and expansion of Medicaid coverage resulted in roughly $130 billion 1 Federal Subsidies for Health Insurance Coverage for People Under Age 65: CBO and JCT’s March 2020 Projections, Congressional Budget Office, Washington, DC, September 29, 2020, cbo.gov. 2 Includes adults made eligible for Medicaid by the ACA and marketplace-related coverage and the Basic Health Program. of incremental healthcare spending by the federal government.
The next three years are expected to be less positive for the economics of the healthcare industry, as profit pools are more likely to be flat. COVID-19 has led to the potential for economic headwinds and a rebalancing of system funds. Current unemployment rates (6.9 percent as of October 2020) 3 The employment situation—October 2020 , US Department of Labor, November 6, 2020, bls.gov. indicate some individuals may move from employer-sponsored insurance to other options. It is expected that roughly between $70 billion and $100 billion in funding may leave the healthcare system by 2022, compared with the expected trajectory pre-COVID-19. The outflow is driven by coverage shifts out of employer-sponsored insurance, product buy-downs, and Medicaid rate pressures from states, partially offset by increased federal spending in the form of subsidies and cost sharing in the Individual market and in Medicaid funding.
Underlying this broader outlook are chances to innovate (Exhibit 1). 4 Smit S, Hirt M, Buehler K, Lund S, Greenberg E, and Govindarajan A, “ Safeguarding our lives and our livelihoods: The imperative of our time ,” March 23, 2020, McKinsey.com. Innovation may drive outpaced growth in three categories: segments that are anticipated to rebound from poor performance over recent years, segments that benefit from shifting care patterns that result directly from COVID-19, and segments where growth was expected pre-COVID-19 and remain largely unaffected by the pandemic. For the payer vertical, we estimate profit pools in Medicaid will likely increase by more than 10 percent per annum from 2019 to 2022 as a result of increased enrollment and normalized margins following historical lows. In the provider vertical, the rapid acceleration in the use of telehealth and other virtual care options spurred by COVID-19 could continue. 5 Bestsennyy O, Gilbert G, Harris A, and Rost J, “ Telehealth: A quarter-trillion-dollar post-COVID-19 reality? ” May 29, 2020, McKinsey.com. Growth is expected across a range of sub-segments in the services and technology vertical, as specialized players are able to provide services at scale (for example, software and platforms and data and analytics). Specialty pharmacy is another area where strong growth in profit pools is likely, with between 5 and 10 percent compound annual growth rate (CAGR) expected in infusion services and hospital-owned specialty pharmacy sub-segments.
Strategies that align to attractive and growing profit pools, while important, may be insufficient to achieve the growth that incumbents have come to expect. For example, in 2019, 34 percent of all revenue in the healthcare system was linked to a profit pool that grew at greater than 5 percent per year (from 2017 to 2019). In contrast, we estimate that only 13 percent of revenue in 2022 will be linked to profit pools growing at that rate between 2019 and 2022. This estimate reflects that profit pools are growing more slowly due to factors that include lower membership growth, margin pressure, and lower revenue growth. This relative scarcity in opportunity could lead to increased competition in attractive sub-segments with the potential for profits to be spread thinly across organizations. Developing new and innovative business models will become important to achieve the level of EBITDA growth observed in recent years and deliver better care for individuals. The good news is that there is significant opportunity, and need, for innovation in healthcare.
New and innovative business models across verticals can generate greater value and deliver better care for individuals
Glimpse into profit pool analyses and select sub-segments.
Within the context of these overarching observations, the projections for specific sub-segments are nuanced and tightly connected to the specific dynamics each sub-segment is currently facing:
- Payer—Small Group: Small group has historically seen membership declines and we expect this trend to continue and/or accelerate in the event of an economic downturn. Membership declines will increase competition and put pressure on incumbent market leaders to both maintain share and margin as membership declines, but fixed costs remain.
- Payer—Medicare Advantage: Historic profit pool growth in the Medicare Advantage space has been driven by enrollment gains that result from demographic trends and a long-term trend of seniors moving from traditional Medicare fee-for-service programs to Medicare Advantage plans that have increasingly offered attractive ancillary benefits (for example, dental benefits, gym memberships). Going forward, we expect Medicare members to be relatively insulated from the effects of an economic downturn that will impact employers and individuals in other payer segments.
- Provider—General acute care hospitals: Cancelation of elective procedures due to COVID-19 is expected to lead to volume and revenue reductions in 2019 and 2020. Though volume is expected to recover partially by 2022, growth will likely be slowed due to the accelerated shift from hospitals to virtual care and other non-acute settings. Payer mix shifts from employer-sponsored to Medicaid and uninsured populations in 2020 and 2021 are also likely to exert downward pressure on hospital revenue and EBITDA, possibly driving cost-optimization measures through 2022.
- Provider—Independent labs: COVID-19 testing is expected to drive higher than average utilization growth in independent labs through 2020 and 2021, with more typical utilization returning by 2022. However, labs may experience pressure on revenue and EBITDA growth as the payer mix shifts to lower-margin segments, offsetting some of the gains attributed to utilization.
- Provider—Virtual office visits: Telehealth has helped expand access to care at a time when the pandemic has restricted patients’ ability to see providers in person. Consumer adoption and stickiness, along with providers’ push to scale-up telehealth offerings, are expected to lead to more than 100 percent growth per annum in the segment from 2019 to 2022, going beyond traditional “tele-urgent” to more comprehensive virtual care.
- HST—Medical financing: The medical financing segment may be negatively impacted in 2020 due to COVID-19, as many elective services for which financing is used have been deferred. However, a quick bounce-back is expected as more patients lacking healthcare coverage may need financing in 2021, and as providers may use medical financing as a lever to improve cash reserves.
- HST—Wearables: Looking ahead, the wearables segment is expected to see a slight dip in 2020 due to COVID-19, but is expected to rebound in 2021 and 2022 given consumer interest in personal wellness and for tracking health indicators.
- Pharma services—Pharmacy benefit management: The growth is expected to return to baseline expectations by 2022 after an initial decline in 2020 and 2021 due to the COVID-19-driven decrease in prescription volume.
New and innovative business models are beginning to show promise in delivering better care and generating higher returns. The existence of these models and their initial successes are reflective of what we have observed in the market in recent years: leading organizations in the healthcare industry are not content to simply play in attractive segments and markets, but instead are proactively and fundamentally reshaping how the industry operates and how care is delivered. While the recipe across verticals varies, common among these new business models are greater alignment of incentives typically involving risk bearing, better integration of care, and use of data and advanced analytics.
Payers—Next-generation managed care models
For payers, the new and innovative business models that are generating superior returns are those that incorporate care delivery and advanced analytics to better serve individuals with increasingly complex healthcare needs (Exhibit 2). As chronic disease and other long-term conditions require more continuous management supported by providers (for example, behavioral health conditions), these next-generation managed care models have garnered notice. Nine of the top ten payers have made acquisitions in the care delivery space. Such models intend to reorient the traditional payer model away from an operational focus on financing healthcare and pricing risk, and toward more integrated managed care models that better align incentives and provide higher-quality, better experience, lower-cost, and more accessible care. Payers that deployed next-generation managed care models generate 0.5 percentage points of EBITDA margin above average expectations after normalizing for payer scale, geographical footprint, and segment mix, according to our research.
The evidence for the effectiveness of these next-generation care models goes beyond the financial analysis of returns. We observe that these models are being deployed in those geographies that have the greatest opportunity to positively impact individuals. Those markets with 1) a critical mass of disease burden, 2) presence of compressible costs (the opportunity for care to be redirected to lower-cost settings), and 3) a market structure conducive to shifting to higher-value sites of care, offer substantial ways to improve outcomes and reduce costs. (Exhibit 3).
Currently, a handful of payers—often large national players with access to capital and geographic breadth that enables acquisition of at-scale providers and technologies—have begun to pursue such models. Smaller payers may find it more difficult to make outright acquisitions, given capital constraints and geographic limitations. M&A activity across the care delivery landscape is leaving smaller and more localized assets available for integration and partnership. Payers may need to increasingly turn toward strategic partnerships and alliances to create value and integrate a range of offerings that address all drivers of health.
Providers—reimagining care delivery beyond the hospital
For health systems, through an investment lens, the ownership and integration of alternative sites of care beyond the hospital has demonstrated superior financial returns. Between 2013 and 2018, the number of transactions executed by health systems for outpatient assets increased by 31 percent, for physician practices by 23 percent, and for post-acute care assets by 13 percent. At the same time, the number of hospital-focused deals declined by 6 percent. In addition, private equity investors and payers are becoming more active dealmakers in these non-acute settings. 6 CapitalIQ, Dealogic, and Irving Levin Associates. 7 In 2018, around 40 percent of all post-acute and outpatient deals were completed by an acquirer other than a traditional provider.
As investment is focused on alternative sites of care, we observe that health systems pursuing diversified business models that encompass a greater range of care delivery assets (for example, physician practices, ambulatory surgery centers, and urgent care centers) are generating returns above expectations (Exhibit 4). By offering diverse settings to receive care, many of these systems have been able to lower costs, enhance coordination, and improve patient experience while maintaining or enhancing the quality of the services provided. Consistent with prior research, 8 Singhal S, Latko B, and Pardo Martin C, “ The future of healthcare: Finding the opportunities that lie beneath the uncertainty ,” January 31, 2018, McKinsey.com. systems with high market share tend to outperform peers with lower market share, potentially because systems with greater share have greater ability not only to ensure referral integrity but also to leverage economies of scale that drive efficiency.
The extent of this outperformance, however, varies by market type. For players with top quartile share, the difference in outperformance between acute-focused players and diverse players is less meaningful. Contrastingly, for bottom quartile players, the increase in value provided by presence beyond the acute setting is more significant. While there may be disadvantages for smaller and sub-scale providers, opportunities exist for these players—as well as new entrants and attackers—to succeed by integrating offerings across the care continuum.
These new models and entrants and their non-acute, technology-enabled, and multichannel offerings can offer a different vision of care delivery. Consumer adoption of telehealth has skyrocketed, from 11 percent of US consumers using telehealth in 2019 to 46 percent now using telehealth to replace canceled healthcare visits. Pre-COVID-19, the total annual revenues of US telehealth players were an estimated $3 billion; with the acceleration of consumer and provider adoption and the extension of telehealth beyond virtual urgent care, up to $250 billion of current US healthcare spend could be virtualized. 9 Bestsennyy O, Gilbert G, Harris A, and Rost J, “ Telehealth: A quarter-trillion-dollar post-COVID-19 reality? ” May 29, 2020, McKinsey.com. These early indications suggest that the market may be shifting toward a model of innovative tech-enabled care, one that unlocks value by integrating digital and non-acute settings into a comprehensive, coordinated, and lower-cost offering. While functional care coordination is currently still at the early stages, the potential of technology and other alternative settings raises the question of the role of existing acute-focused providers in a more integrated and digital world.
Would you like to learn more about our Healthcare Systems & Services Practice ?
Healthcare services and technology—innovation and integration across the value chain.
Growth in the healthcare services and technology vertical has been material, as players are bringing technology-enabled services to help improve patient care and boost efficiency. Healthcare services and technology companies are serving nearly all segments of the healthcare ecosystem. These efforts include working with payers and providers to better enable the link between actions and outcomes, to engage with consumers, and to provide real-time and convenient access to health information. Since 2014, a large number and value of deals have been completed: more than 580 deals, or $83 billion in aggregate value. 10 Includes deals over $10 million in value. 11 Analysis from PitchBook Data, Inc. and McKinsey Healthcare Services and Technology domain profit pools model. Venture capital and private equity have fueled much of the innovation in the space: more than 80 percent 12 Includes deals over $10 million in value. of deal volume has come from these institutional investors, while more traditional strategic players have focused on scaling such innovations and integrating them into their core.
Driven by this investment, multiple new models, players, and approaches are emerging across various sub-segments of the technology and services space, driving both innovation (measured by the number of venture capital deals as a percent of total deals) and integration (measured by strategic dollars invested as a percent of total dollars) with traditional payers and providers (Exhibit 5). In some sub-segments, such as data and analytics, utilization management, provider enablement, network management, and clinical information systems, there has been a high rate of both innovation and integration. For instance, in the data and analytics sub-segment, areas such as behavioral health and social determinants of health have driven innovation, while payer and provider investment in at-scale data and analytics platforms has driven deeper integration with existing core platforms. Other sub-segments, such as patient engagement and population health management, have exhibited high innovation but lower integration.
Traditional players have an opportunity to integrate innovative new technologies and offerings to transform and modernize their existing business models. Simultaneously, new (and often non-traditional) players are well positioned to continue to drive innovation across multiple sub-segments and through combinations of capabilities (roll-ups).
Pharmacy value chain—emerging shifts in delivery and management of care
The profit pools within the pharmacy services vertical are shifting from traditional dispensing to specialty pharmacy. Profits earned by retail dispensers (excluding specialty pharmacy) are expected to decline by 0.5 percent per year through 2022, in the face of intensifying competition and the maturing generic market. New modalities of care, new care settings, and new distribution systems are emerging, though many innovations remain in early stages of development.
Specialty pharmacy continues to be an area of outpaced growth. By 2023, specialty pharmacy is expected to account for 44 percent of pharmacy industry prescription revenues, up from 24 percent in 2013. 13 Fein AJ, The 2019 economic report on U.S. pharmacies and pharmacy benefit managers , Drug Channels Institute, 2019, drugchannelsinstitute.com. In response, both incumbents and non-traditional players are seeking opportunities to both capture a rapidly growing portion of the pharmacy value chain and deliver better experience to patients. Health systems, for instance, are increasingly entering the specialty space. Between 2015 and 2018 the share of provider-owned pharmacy locations with specialty pharmacy accreditation more than doubled, from 11 percent in 2015 to 27 percent in 2018, creating an opportunity to directly provide more integrated, holistic care to patients.
Challenges emerge for the US healthcare system as COVID-19 cases rise
A new wave of modalities of care and pharmaceutical innovation are being driven by cell and gene therapies. Global sales are forecasted to grow at more than 40 percent per annum from 2019 to 2024. 14 Evaluate Pharma, February 2020. These new therapies can be potentially curative and often serve patients with high unmet needs, but also pose challenges: 15 Capra E, Smith J, and Yang G, “ Gene therapy coming of age: Opportunities and challenges to getting ahead ,” October 2, 2019, McKinsey.com. upfront costs are high (often in the range of $500,000 to $2,000,000 per treatment), benefits are realized over time, and treatment is complex, with unique infrastructure and supply chain requirements. In response, both traditional healthcare players (payers, manufacturers) and policy makers (for example, the Centers for Medicare & Medicaid Services) 16 Centers for Medicare & Medicaid Services, “Medicaid program; establishing minimum standards in Medicaid state drug utilization review (DUR) and supporting value-based purchasing (VBP) for drugs covered in Medicaid, revising Medicaid drug rebate and third party liability (TPL) requirements,” Federal Register , June 19, 2020, Volume 85, Number 119, p. 37286, govinfo.gov. are considering innovative models that include value-based arrangements (outcomes-based pricing, annuity pricing, subscription pricing) to support flexibility around these new modalities.
Innovations also are accelerating in pharmaceutical distribution and delivery. Non-traditional players have entered the direct-to-consumer pharmacy space to improve efficiency and reimagine customer experience, including non-healthcare players such as Amazon (through its acquisition of PillPack in 2018) and, increasingly, traditional healthcare players as well, such as UnitedHealth Group (through its acquisition of DivvyDose in September 2020). COVID-19 has further accelerated innovation in patient experience and new models of drug delivery, with growth in tele-prescribing, 17 McKinsey COVID-19 Consumer Survey conducted June 8, 2020 and July 14, 2020. a continued shift toward delivery of pharmaceutical care at home, and the emergence of digital tools to help manage pharmaceutical care. Select providers have also begun to expand in-home offerings (for example, to include oncology treatments), shifting the care delivery paradigm toward home-first models.
A range of new models to better integrate pharmaceutical and medical care and management are emerging. Payers, particularly those with in-house pharmacy benefit managers, are using access to data on both the medical and pharmacy benefit to develop distinctive insights and better coordinate across pharmacy and medical care. Technology providers, together with a range of both traditional and non-traditional healthcare players, are working to integrate medical and pharmaceutical care in more convenient settings, such as the home, through access to real-time adherence monitoring and interventions. These players have an opportunity to access a broad range of comprehensive data, and advanced analytics can be leveraged to more effectively personalize and target care. Such an approach may necessitate cross-segment partnerships, acquisitions, and/or alliances to effectively integrate the many components required to deliver integrated, personalized, and higher-value care.
Creating and capturing new value
These materials are being provided on an accelerated basis in response to the COVID-19 crisis. These materials reflect general insight based on currently available information, which has not been independently verified and is inherently uncertain. Future results may differ materially from any statements of expectation, forecasts or projections. These materials are not a guarantee of results and cannot be relied upon. These materials do not constitute legal, medical, policy, or other regulated advice and do not contain all the information needed to determine a future course of action. Given the uncertainty surrounding COVID-19, these materials are provided “as is” solely for information purposes without any representation or warranty, and all liability is expressly disclaimed. References to specific products or organizations are solely for illustration and do not constitute any endorsement or recommendation. The recipient remains solely responsible for all decisions, use of these materials, and compliance with applicable laws, rules, regulations, and standards. Consider seeking advice of legal and other relevant certified/licensed experts prior to taking any specific steps.
Before the COVID-19 pandemic, our research indicated that profits for healthcare organizations were expected to be harder to earn than they have been in the recent past, which has been made even more difficult by COVID-19. New entrants and incumbents who can reimagine their business models have a chance to find ways to innovate to improve healthcare and therefore earn superior returns. The opportunity for incumbents who can reimagine their business models and new entrants is substantial.
Institutions will be expected to do more than align with growth segments of healthcare. The ability to innovate at scale and with speed is expected to be a differentiator. Senior leaders can consider five important questions:
- How does my business model need to change to create value in the future healthcare world? What are my endowments that will allow me to succeed?
- How does my resource (for example, capital and talent) allocation approach need to change to ensure the future business model is resourced differentially compared with the legacy business?
- How do I need to rewire my organization to design it for speed? 18 De Smet A, Pacthod D, Relyea C, and Sternfels B, “ Ready, set, go: Reinventing the organization for speed in the post-COVID-19 era ,” June 26, 2020, McKinsey.com.
- How should I construct an innovation model that rapidly accesses the broader market for innovation and adapts it to my business model? What ecosystem of partners will I need? How does my acquisition, partnership, and alliances approach need to adapt to deliver this rapid innovation?
- How do I prepare my broader organization to adopt and scale new innovations? Are my operating processes and technology platforms able to move quickly in scaling innovations?
There is no question that the next few years in healthcare are expected to require innovation and fresh perspectives. Yet healthcare stakeholders have never hesitated to rise to the occasion in a quest to deliver innovative, quality care that benefits everyone. Rewiring organizations for speed and efficiency, adapting to an ecosystem model, and scaling innovations to deliver meaningful changes are only some of the ways that helping both healthcare players and patients is possible.
Emily Clark is an associate partner in the Stamford office. Shubham Singhal , a senior partner in McKinsey’s Detroit office, is the global leader of the Healthcare, Public Sector and Social Sector practices. Kyle Weber is a partner in the Chicago office.
The authors would like to thank Ismail Aijazuddin, Naman Bansal, Zachary Greenberg, Rob May, Neha Patel, and Alex Sozdatelev for their contributions to this article.
This article was edited by Elizabeth Newman, an executive editor in the Chicago office.
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Sample Hospital Business Plan PDF [Template]
Hospital business plan sample.
Healthcare business offers one of the basic needs of every individual, and everyone has at one time or the other required the services of medical personnel or establishment (hospital, medical clinic , pharmacy, nursing home , etc).
Most countries have more population than the currently established hospitals can cater for, and so most hospitals are over-stretched, and with the population growth, there is the need for more hospitals.
Starting and managing your own hospital business is very capital intensive and requires a lot of planning to accomplish.
You will also need to get the necessary permits from the various regulatory bodies and the government of the country or state you hope to establish the hospital in.
You also need to determine the capacity of the hospital you want to open and whether it will be a multi-specialty, specialist, or general hospital. Here are a few things you should put into consideration when starting a hospital business:
Choose a location that is easily accessible to people in case of emergencies.
The area also needs to have a good transportation network and infrastructure and should be situated close to or in an area with high population density if you want to succeed in the business.
Also worth considering is the number of hospitals in the region you have chosen as you may not be able to pool in as many clients if your hospital is situated too close to another one.
Land for the hospital can be purchased or leased and the hospital building must conform to the standards set and agreed on by the medical, technical, and environmental regulatory bodies of the country and locality of the hospital.
A lot of documents such as a land deed, architectural plans need to be approved by the relevant authorities.
If you wish to purchase the land, then you have to consider the systems for medical waste disposal, infection and disease prevention, parking space, and others.
You will be given an occupation certificate when all formalities have been cleared.
Medical Equipment and Facility
Medical equipment is a major part of starting up a hospital business and a lot of attention should be given to it.
Every piece of equipment must be standard, top-notch, and in top form always so attention must be paid to the quality of equipment acquired as the lives and health of your patients could depend on it.
Equipment procurement may be costly especially if it has to be imported as custom duties and taxes may apply. It is worthy of note that the kind of hospital will determine the kind of equipment and facilities to be used.
For example, an orthopedic hospital and a pediatric hospital will have different needs for medical supply businesses .
Power and Water Supply
Electricity is essential to the running of any establishment, more especially a hospital as a majority of the equipment runs on electricity, so provision must be made for backup power in case the local power supply fails as may be the case, especially in developing countries.
You do not want to face a power outage when a critical procedure is being carried out.
Water is also essential in the running of a hospital for various purposes. The water needs of the hospital should be calculated and this may vary greatly depending on the size, capacity, and requirements of the hospital.
Sewage and Biomedical Waste
Waste disposal and drainage system should be properly planned into the construction of the hospital.
You may also need to obtain permission from the relevant authorities to install incinerators that are required to dispose of body parts and other medical waste. This is important even in a low-cost hospital business model.
Workers and Members of Staff
Healthcare is a highly sensitive and competitive business to own, and quackery should not be tolerated if you want your hospital to stand out among its competitors.
Always hire and invest in employees that are not just qualified and good at what they do, but also have a passion and commitment to deliver quality healthcare to patients.
Apart from medical personnel, you will also need engineers, technicians, receptionists, wardens, security, cleaners, and others to ensure the smooth running of the hospital.
Permits and Licenses
Various permits and licenses have to be obtained from the state and local government councils, and medical regulatory bodies and associations at different stages of the business development, especially at inception.
This will give your hospital the legal grounds to operate freely.
In India, among such licenses are a Fire license, which is necessary to show that a hospital will not cause loss of life or damage and a health license that authorizes you to give healthcare to patients.
Management and Marketing
What might be a business process used at a hospital? A management team has to be set up to handle the running of the hospital. This team is responsible for setting up policies, hiring, and payment of staff, among other responsibilities necessary for the hospital to operate smoothly.
A marketing team is also necessary to coordinate with other medical associations, manage the hospital’s public image, and create avenues for generating revenue as well.
Starting a hospital is a complex venture and requires a lot of careful planning and consultation.
The above-stated points should give you an idea of what is involved.
You will need to draw out a detailed business plan and follow a lot of guidelines, obtain various certifications and approvals. It may take a lot of time and effort, but it will be worth it in the long run.
NEW HOSPITAL ESTABLISHMENT BUSINESS PLAN EXAMPLE
Here is a sample business plan for starting a hospital.
The hospital business is a subset of the health care industry which is ranked as one of the fastest-growing industries in the world. Aside from being ranked as one of the fastest-growing industries in the world, the health care industry is ranked among the largest industries in the world too.
If you are already set towards starting a private hospital business and are planning on writing a business plan, then you will find this simple business plan very useful.
BUSINESS NAME: John Rutherford Hospital.
Our Products and Services
- Market Analysis
Sales and Marketing Strategy
- Financial Plan
John Rutherford Hospital is a standard and duly registered, certified, and licensed hospital which will be located in Boston, United States.
The hospital will be very motivated towards providing nothing short of the very best services to clients not just in Boston but in the whole of the United States.
John Rutherford Hospital will be owned by Dr. John Rutherford (Jnr.) who will also be the major financer of the startup budget towards starting the business in Boston.
The other part of the startup budget, however, will be sourced from the owner’s former business associates and his bank.
John Rutherford Hospital is in the health care industry to make sure clients are well catered for medically.
We are in this line of business to make profits too, and the following are the various products and services we will be offering our clients:
- Inpatient care
- Outpatient care
- Diagnostic X-ray services
- Operating room services
- Clinical laboratory services
- Anatomical pathology services
- Personal Injury Case Management
- Occupational, Physical, and Speech Therapy
We have it as our vision for our hospital to become the first choice of clients for excellent medical and health care services. Also, we want to make sure of becoming ranked among the top ten (10) health care service providers in the whole of the United States of America before our tenth year of operating as a hospital.
We are in this line of business to fully serve our clients not just in Boston but in the whole of the United States.
John Rutherford Hospital will provide very affordable health care services that can fit into the budget of both high-income earners and low-income earners.
John Rutherford Hospital is a hospital that will be raised on a very solid foundation.
We are duly concerned with providing the very best and professional health care services to our clients. We will make sure to recruit only qualified and experienced professionals who have fully met our stringent requirements.
This is to ensure that we provide our clients with the very best health care services. The following are the various professionals we will be recruiting into our business:
- Chief Executive Officer
- Chief Medical Director
- Surgeon / Dentist
- Nurses / Nurse Aides
- Information Technologist
- Sales and Marketing Executive
- Admin and Human Resources Manager
- Accountant / Cashier
- Customer Care Executive
Market Analysis Market Trend
The health care industry is very dynamic and thriving too. The industry is still growing despite the huge success it has achieved with the help of modern technology.
Today, many illnesses that were once very difficult to cure or even manage have become curable and easy to manage as well, thanks to the improvement in the industry utilizing today’s technology.
Our target market encompasses every person living in Boston, and the United States.
Our target market is not limited to any particular group, since everyone at one point in time or another may see the need to visit the hospital.
However, we have categorized our target market into the following:
- Residents in the location where we will be operating our business
- Sportsmen and women who have sustained an injury
- Expectant Mothers
- Corporate Organizations and financial institutions such as banks and insurance companies
- Health Management Organizations
We have been able to carry out a thorough market survey before we resolved on sticking with our current location for our hospital. This was to make sure that we can deeply penetrate the market once we fully launch our business.
Nonetheless, we have come up with the following sales and market strategies to ensure we promote our business to prospective clients:
- We will start up by making sure we put the word out there concerning our business. We will carry this out by sending introductory letters to all the residents in our location, corporate organizations, and business owners.
- We will make sure to advertise our hospital on various local media such as local TV and radio stations, local newspapers, etc.
- We will list our hospital on yellow page ads.
- Social media will be utilized to the fullest in promoting our hospital. We will make sure to have a Facebook page, as well as open Twitter and Instagram accounts.
- We will always ensure we keep up-to-date with the latest developments in the industry by making sure of attending healthcare-related expos and exhibitions.
Financial Plan Source of Startup Capital
Having carried out our feasibility study thoroughly, we have come to realize that we will need a total of $1.3M to fully kick start our business in Boston, United States.
A total of $600,000 has thus far been raised by the owner, Dr. John Rutherford (Jnr.). The remainder will be sought from the owner’s bank and former business associates.
There is huge competition in the health care industry, not only among the hospitals but also between hospitals and other health care service providers such as health centers, home health care services , community clinics, etc.
Our competitive advantage in the industry lies in the quality of client services that we will be providing our clients.
We are very convinced that we will be able to handle the competition in the industry as long as we consistently provide quality services.
It is for this reason that we have made our recruitment requirements to be very stringent to hire only qualified and experienced professionals that will be able to work with us to achieve our goals.
SEE: CNA School Business Plan
Above is a startup hospital business plan sample that bears the business name, ‘John Rutherford Hospital’.
The hospital will be located in Boston, United States, and it will be owned by Dr. John Rutherford.
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Hospital Business Plan [Sample Template]
By: Author Tony Martins Ajaero
Home » Business ideas » Healthcare and Medical » Hospital and Clinic
Are you about starting a hospital/healthcare center? If YES, here is a complete sample hospital business plan template & feasibility study you can use for FREE .
Okay, so we have considered all the requirements for starting a hospital . We also took it further by analyzing and drafting a sample healthcare service marketing plan template backed up by actionable guerrilla marketing ideas for hospitals. So let’s proceed to the business planning section.
It might no longer be new to you that health is indeed wealth. We all have come to know that aphorism without no hassle.
It is therefore in place to say that when one has a sound health, one can be of optimum relevance to the society. This is one of the reason those who are in the medical line are solving this problem through diverse healthcare businesses. One healthcare business that is focus here is the hospital business.
Starting a hospital is one of those businesses that require you to first look at the existing laws in the country or the State you reside, before going all out to start the business. This is so because there is hardly any country that does not pay serious attention on their health sector.
The health industry is usually highly regulated so as to guide against the infiltration of quacks or substandard hospital or health facilities.
If you have interest in starting your own hospital business, then you would need to pay a visit to the health and medical regulatory body in your country ( the department / ministry of health and medical services ) to get all the needed information that is required before you can legally start your own hospital business in your city.
Also the business plan is something that you have got to tackle with before launching out in business. Very vital information such as the vision, mission, marketing plans, legal documents, as well as many other things will be looked in a business plan. Here is a sample hospital business plan that is capable of leading you all the way;
A Sample Hospital Business Plan Template
1. industry overview.
No doubt, the healthcare cum medical industry of which hospital business is a subset of, is perhaps one of the fastest growing and largest industries in the world; this is so because the wealth of any nation depends on the health of the nation.
Obviously there is hardly any country where the healthcare industry is not handled with all seriousness. As a matter of fact, the healthcare industry is known to gulp well over 10 percent of gross domestic product (GDP) of most developed countries.
Basically, a healthcare provider is a health professional such as nurse or doctor et al or an establishment such as a hospital or a medical clinic or a healthcare center / facility that provides preventive, curative, promotional, rehabilitative or palliative healthcare / medical services in a systematic way to individuals, families or communities.
The hospital industry comprises of operators who are licensed as general medical and surgical hospitals that provide surgical and nonsurgical diagnostic and medical treatment to inpatients with medical conditions. In general, hospitals maintain inpatient beds and usually provide other services such as outpatient services, operating room services and pharmacy services.
There is indeed a very large market for hospital (healthcare service) providers in the united states and of course in most parts of the world.
For instance, the World Health Organization (W.H.O) estimated that there are about 9.2 million physicians, 19.4 million nurses and midwives, 1.9 million dentists and other dentistry personnel, 2.6 million pharmacists and other pharmaceutical personnel, and over 1.3 million community health workers worldwide. This goes to show that the healthcare industry is indeed one of the largest segments of the workforce of any nation.
It is on record that in 2011, healthcare costs paid to hospitals, physicians, nursing homes , diagnostic laboratories, pharmacies, medical device manufacturers and other players in the healthcare system business value chain consumed an estimated value of 17.9 percent of the Gross Domestic Product (GDP) of the United States; this is indeed the largest of any country in the world.
As a matter of fact, experts projected that the healthcare share of the GDP of the United States will continue to grow, reaching 19.6 percent of GDP by 2016. The Healthcare cum Hospital industry is indeed a very massive industry in the U.S.
Statistics has it that The Hospital industry in the United States of America, is worth $986bn, with an estimated growth rate of 3.4 percent.
There are about 3,184 registered and licensed hospital businesses in the United States and they are responsible for employing about 5,513,669 people that comprises of doctors, nurses, pharmacists, dentist, opticians, surgeons and other health and non – health workers.
It is important to state that there is no hospital with a lion share of the available market in the United States. If you are considering starting your own hospital in the United States, then you should try and work around the industry barriers.
The truth is that, the barriers to entry in the Hospitals industry are high and this is due to the significant regulatory requirements and the experience and strength of incumbents. For example, medical licensure creates a barrier to entry in the healthcare sector.
As a matter of fact, it is absolutely compulsory for any investor who is looking towards starting a hospital to meet extensive federal, state and local laws and regulations. These regulations relate to the adequacy of medical care, equipment, personnel, operating policies and procedures.
Regulations also involve maintaining adequate records, preventing fires, setting rates and complying with building codes and environmental protection laws. These regulations make it difficult and costly for aspiring entrepreneurs to enter the industry.
Over and above, if you are determine and you are ready to go all the way, you will surely succeed in establishing your hospital in the United States of America and you will be glad you did because it is indeed a profitable line of business.
2. Executive Summary
Joan & Phil® Hospital, LLC is a standard, licensed and certified hospital service provider that will be located in the heart of Miami Beach, Florida – United States of America. We have been able to acquire a standard facility that is highly suitable for the kind of hospital business we want to operate.
Joan & Phil® Hospital, LLC is in the hospital industry to provide healthcare services such as Inpatient care, Outpatient care, Anatomical pathology services, Diagnostic X-ray services, Clinical laboratory services, Operating room services and other medical services. We are well trained and equipped to service the market segments that require healthcare services.
We are in the hospital business to deliver excellent healthcare services to all those who will patronize our services. We will also ensure that in the line of carrying out our duty, we comply with the laws and health regulations in Florida and The United States of America. Our employees are well trained and qualified to handle the wide range of healthcare services.
Joan & Phil® Hospital, LLC will operate a 24 hours 7 days a week healthcare service; our hospital will be opened round the clock to attend to clients (patients). We have a standard medical call center that is manned by trained health workers.
Our work force is going to be well trained to operate within the framework of our organization’s corporate culture and also to meet the needs of all our customers. Joan & Phil® Hospital, LLC will ensure that all our patients cum customers are given first class treatment whenever they visit our hospital.
We have a CRM software that will enable us manage a one on one relationship with our customers no matter how large the numbers of our customers’ base grows. Joan & Phil® Hospital, LLC is a family business that is owned and managed by Dr. Marvin Clarkson and his wife Joan Clarkson (Nurse). Dr. Phil Clarkson is going to be the Medical Director (Chief Executive Officer) of the hospital;
He is a qualified and well trained Medical Doctor with well over 15 years of experience working as a medical doctor and medical researcher with the United States’ government. He will be ably supported by his wife Joan Clarkson who has grown in her career to become one of the most respected senior nurses in Miami, Florida.
3. Our Products and Services
Joan & Phil® Hospital, LLC is in the business of ensuring that our patient / clients are well treated and taken care of and our services will be carried out by highly trained professional doctors, dentist, surgeons, opticians, nurses, nurse’s aides, mental health counselors, chiropractors, medication management counselors, physical therapists and other health and non – health workers, who know what it takes to give our highly esteemed customers (patients) value for their money.
These are the healthcare services that Joan & Phil® Hospital, LLC will be offering;
- Inpatient care
- Outpatient care
- Anatomical pathology services
- Diagnostic X-ray services
- Clinical laboratory services
- Operating room services
- Occupational, Physical, and Speech Therapy
- Personal Injury Case Management
4. Our Mission and Vision Statement
- Our vision is to become the number one choice when it comes to healthcare service delivery in the whole of Florida and also to be amongst the top 20 ( hospital ) healthcare service provider in the United States of America within the next 10 years.
- Joan & Phil® Hospital, LLC is in business is to establish a first class hospital that will take care of both highly placed clients and lowly placed clients as long as they can afford our services.
- We want to become one of the leaders in the hospital cum healthcare services industry in Florida, and in The United States of America.
Our Business Structure
Joan & Phil® Hospital, LLC is a business that will be built on a solid foundation. From the outset, we have decided to recruit only qualified professionals (doctors, dentist, surgeons, opticians, nurses, nurse’s aides, chiropractors, medication management counselors, physical therapists and other health and non – health workers) to man various job positions in our organization.
We are quite aware of the rules and regulations governing the hospital cum healthcare industry which is why we decided to recruit only well experienced and qualified employees as foundational staff of the organization. We hope to leverage on their expertise to build our hospital brand to be well accepted in Florida and the whole of the United States.
When hiring, we will look out for applicants that are not just qualified and experienced, but honest, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders ( the owners, workforce, and customers ).
As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of five years or more. These are the positions that will be available at Joan & Phil® Hospital, LLC;
- Chief Medical Director / Chief Executive Officer
- Doctor / Surgeon / Dentist
Nurses / Nurse’s Aides
- Information Technologist (Contract)
- Admin and Human Resources Manager
- Sales and Marketing Executive
- Accountant / Cashier
- Customer Care Executive
5. Job Roles and Responsibilities
Chief Medical Director / Chief Executive Officer:
- Responsible for providing direction for the business
- Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Attend to high profile clients and severe medical cases
- Responsible for fixing prices and signing business deals
- Responsible for recruitment
- Responsible for payment of salaries
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
- Responsible for providing professional medical services to our patients
- Responsible for offering occupational, physical, and speech therapy
- Responsible for handling medical emergencies.
- Responsible for managing the daily activities in the company (dispensary store)
- providing advice about health issues, symptoms and medications in response to customer enquiries
- Responsible for recruiting, training and managing staff
- Responsible for processing prescriptions and dispensing medication
- Responsible for ordering, selling and controlling medicines and other stock
- Responsible for meeting medical representatives
- Responsible for managing the organizations’ budgets
- Responsible for keeping statistical and financial records
- Responsible for preparing publicity materials and displays
- Handle marketing services
- Interfaces with third – party providers (vendors)
- Handle any other duty as assigned by the Medical Director.
- Responsible for managing our patients
- Handles personal injury case management
- Responsible for offering medication management services
- Assist the doctors in treating patients
Sales and Marketing Manager
- Manage external research and coordinate all the internal sources of information to retain the organizations’ best customers and attract new ones
- Model demographic information and analyze the volumes of transactional data generated by customer
- Identifies development opportunities; follows up on development leads and contacts; participates in the structuring and financing of projects; assures the completion of development projects.
- Writing winning proposal documents, negotiate fees and rates in line with organizations’ policy
- Responsible for handling business research, market surveys and feasibility studies for clients
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Develop, execute and evaluate new plans for expanding increase sales
- Create new markets cum businesses for the organization
- Empower and motivates the sales team to meet and surpass agreed targets
- Manage the organization website
- Handles e-commerce aspect of the business
- Responsible for installing and maintenance of computer software and hardware for the organization
- Manage logistics and supply chain software, Web servers, e-commerce software and POS (point of sale) systems
- Manage the organization’s CRM software application
- Handles any other technological and IT related duties.
Accountant / Cashier:
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Provides managements with financial analyses, development budgets, and accounting reports; analyzes financial feasibility for the most complex proposed projects; conducts market research to forecast trends and business conditions.
- Responsible for financial forecasting and risks analysis.
- Performs cash management, general ledger accounting, and financial reporting for one or more properties.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensuring compliance with taxation legislation
- Handles all financial transactions for Joan & Phil® Hospital, LLC
- Serves as internal auditor for Joan & Phil® Hospital, LLC.
Client Service Executive
- Welcomes clients and potential clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the creative director in an effective and timely manner
- Consistently stays abreast of any new information on the organizations’ products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients when they make enquiries
- Responsible for cleaning the hospital facility at all times
- Ensure that toiletries and supplies don’t run out of stock
- Cleans both the interior and exterior of the hospital facility
- Handle any other duty as assigned by the admin and HR manager.
6. SWOT Analysis
Joan & Phil® Hospital, LLC is set to become one of the leading hospital cum healthcare service providers in Florida which is why we are willing to take our time to cross every ‘Ts’ and dot every ‘Is’ as it relates to our business. We want our hospital to be the number one choice of all residence of Miami and other cities in Florida.
We know that if we are going to achieve the goals that we have set for our business, then we must ensure that we build our business on a solid foundation. We must ensure that we follow due process in setting up the business.
Even though our Chief Medical Director (owner) has a robust experience in health management services, public health and medical research, we still went ahead to hire the services of business consultants that are specialized in setting up new businesses to help our organization conduct detailed SWOT analysis and to also provide professional support in helping us structure our business to indeed become a leader in the hospital / healthcare industry.
This is the summary of the SWOT analysis that was conducted for Joan & Phil® Hospital, LLC;
Our strength lies in the fact that we have a team of well qualified professionals manning various job positions in our hospital. As a matter of fact, they are some of the best hands in the whole of Miami Florida.
Our location, the Business model we will be operating on, opening 24 hours daily and 7 days in a week, multiple payment options, well equipped medical call center and our excellent customer service culture will definitely count as a strong strength for us.
Our perceived weakness lies in the point that we are just starting out and we may not have the required finance to sustain the kind of publicity that we intend giving the business and also the finance needed for the acquiring some of the latest medical and surgical equipment et al.
The opportunities that are available to hospitals cum healthcare services providers are unlimited considering the fact that hospital is not only meant for those who are sick and need treatment; people who are not sick may be required to conduct routine medical checkups from time to time and we are going to position our hospital to make the best out of the opportunities that will be available to us in Florida.
Just like any other business, one of the major threats that we are likely going to face is economic downturn and unfavorable government policies (healthcare reform). It is a fact that economic downturn affects purchasing power. Another threat that may likely confront us is the arrival of a new and bigger / well established hospital or healthcare brand in same location where our hospital is located.
7. MARKET ANALYSIS
- Market Trends
The hospital cum healthcare industry is indeed a thriving and dynamic industry; with the aid of technology, it is becoming easier to treat, manage and cure some ailments that before now are not easy to handle. No doubt there are many ways of providing healthcare services in this changing era since the place of delivery may be in the patient home, the community, the workplace, or in health facilities.
The hospital industry has recently begun consolidating, largely due to the pressures of healthcare reform. The truth is that, the demand for hospital cum healthcare services has steadily grown over the last five years, as healthcare reform legislation broadened insurance coverage and the plummeting unemployment rate increased disposable income.
As an investor in the hospital cum healthcare industry, in order to maintain an advantaged position in this competitive industry, you should source for the most skilled and specialized healthcare professionals. One thing about this industry is that labor costs is on the high side. However, hospitals have also faced nurse and physician shortages and have struggled to recruit qualified personnel.
Industry profitability has generally risen over the past five years due to increases in service prices. No doubt the home healthcare industry will continue to grow and become more profitable because the aging baby-boomer generation in Unites States is expected to drive increasing demand for healthcare services.
8. Our Target Market
Joan & Phil® Hospital, LLC is in business to service a wide range of customers in Miami Beach, Florida – United States of America and other cities such as Green – acres City, Miami, Jacksonville, Clearwater, Tampa, Fort Lauderdale, North Miami, West Palm Beach, Palm Harbor, Deltona, Orlando, Palm Bay and Panama City et al.
We will ensure that we target but self – pay customers (who do not have health insurance cover), and those who have health insurance cover. Generally, every living person, whether old or young will at one point or the order need to visit the hospital.
The fact that we are going to open our doors to a wide range of customers does not in any way stop us from abiding by the rules and regulations governing the hospital cum healthcare industry in the United States. Our staff is well – trained to effectively service our customers and give them value for their monies.
Our customers can be categorized into the following;
- The whole residents within the area where our hospital is located
- Expectant Mothers
- Injured Sports Men and Women
- Corporate organizations such as banks, insurance companies, manufacturing companies, oil and gas companies et al
- Health Management Organizations (HMOs)
Our Competitive Advantage
Aside from the competitions that exist amongst various hospitals, they also compete against other healthcare services providers such as home healthcare services providers, health centers and community clinics et al.
To be highly competitive in the hospital cum healthcare industry means that you should be able to deliver consistent quality patient service and should be able to meet the expectations of your patients at all time; they should experience improvement in their health when they patronize your hospital.
Joan & Phil® Hospital, LLC is coming into the market well prepared to favorably compete in the industry. Our hospital facility is well positioned ( centrally positioned ) and visible, we have enough parking space with good security. Our staff is well groomed in all aspect of healthcare service delivery and all our employees are trained to provide customized customer service to all our clients (patients).
Our services will be carried out by highly trained professionals ( doctors, dentist, surgeons, opticians, nurses, nurse’s aides, chiropractors, medication management counselors, physical therapists and other health and non – health workers ) who know what it takes to give our highly esteemed customers value for their money.
We are going to be one of the few hospitals cum healthcare service providers in the whole of Florida that will run a standard medical call center for 24 hours a day and 7 days a week. We have enough trained health workers that are ready to run a shift system.
Lastly, all our employees will be well taken care of, and their welfare package will be among the best within our category (startups hospitals cum healthcare service providers in the United States) in the industry. It will enable them to be more than willing to build the business with us and help deliver our set goals and achieve all our business aims and objectives.
9. SALES AND MARKETING STRATEGY
- Sources of Income
Joan & Phil® Hospital LLC will ensure that we do all we can to maximize the business by generating income from every legal means within the scope of our industry. Below are the sources we intend exploring to generate income for Joan & Phil® Hospital, LLC;
10. Sales Forecast
It is important to state that our sales forecast is based on the data gathered during our feasibility studies, market survey and also some of the assumptions readily available on the field. We have been able to critically examine the healthcare market and we have analyzed our chances in the industry and we have been able to come up with the following sales forecast.
The sales projection is based on information gathered on the field and some assumptions that are peculiar to similar startups in Miami – Florida. Below is the sales projection for Joan & Phil® Hospital, LLC it is based on the location of our hospital and of course the wide range of our services and target market;
- First Year-: $100,000 ( From Self – Pay Clients / Patients ): $250,000 ( From Health Insurance Companies )
- Second Year-: $250,000 ( From Self – Pay Clients / Patients ): $500,000 ( From Health Insurance Companies )
- Third Year-: $500,000 ( From Self – Pay Clients / Patients ): $1,500,000 ( From Health Insurance Companies )
N.B : This projection is 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.
- Marketing Strategy and Sales Strategy
The marketing and sales strategy of Joan & Phil® Hospital, LLC will be based on generating long-term personalized relationships with customers. In order to achieve that, we will ensure that we offer top notch all – round healthcare services at affordable prices compare to what is obtainable in Florida.
All our employees will be well trained and equipped to provide excellent and knowledgeable healthcare services and customer service.
We know that if we are consistent with offering high quality healthcare service delivery and excellent customer service, we will increase the number of our customers by more than 25 percent for the first year and then more than 40 percent subsequently.
Before choosing a location for our hospital, we conducted a thorough market survey and feasibility studies in order for us to be able to be able to penetrate the available market and become the preferred choice for residence of Miami Beach, Florida – United States of America and other cities such as Green – acres City, Miami, Jacksonville, Clearwater, Tampa, Fort Lauderdale, North Miami, West Palm Beach, Palm Harbor, Deltona, Orlando, Palm Bay and Panama City et al where our services will be available.
We have detailed information and data that we were able to utilize to structure our business to attract the numbers of customers we want to attract per time.
We hired experts who have good understanding of the hospital cum healthcare industry to help us develop marketing strategies that will help us achieve our business goal of winning a larger percentage of the available market in Florida. In summary, Joan & Phil® Hospital, LLC Services will adopt the following sales and marketing approach to win customers over;
- Introduce our business by sending introductory letters to residence, business owners and corporate organizations
- Advertise our hospital in community based newspapers, local TV and local radio stations
- List our hospital on yellow pages ads (local directories)
- Leverage on the internet to promote our hospital
- Engage in direct marketing
- Leverage on word of mouth marketing (referrals)
- Enter into business partnership with health management organizations, government agencies and health insurance companies.
- Attend healthcare related exhibitions / expos.
11. Publicity and Advertising Strategy
We are in the hospital business -to become one of the market leaders and also to maximize profits hence we are going to explore all available conventional and non – conventional means to promote our hospital. Joan & Phil® Hospital, LLC has a long term plan of opening of hospital in key cities around Florida which is why we will deliberately build our brand to be well accepted in Miami Beach before venturing out.
As a matter of fact, our publicity and advertising strategy is not solely for winning customers over but to effectively communicate our brand to the general public. Here are the platforms we intend leveraging on to promote and advertise Joan & Phil® Hospital, LLC;
- Place adverts on both print (community based newspapers and magazines) and electronic media platforms
- Sponsor relevant community health programs
- Leverage on the internet and social media platforms like; Instagram, Facebook , twitter, YouTube, Google + et al to promote our brand
- Install our Bill Boards on strategic locations all around Miami Beach Florida.
- Engage in road show from time to time
- Distribute our fliers and handbills in target areas
- Ensure that all our workers wear our branded shirts and all our vehicles and ambulances are well branded with our company’s logo et al.
12. Our Pricing Strategy
Joan & Phil® Hospital, LLC will work towards ensuring that all our services are offered at highly competitive prices compare to what is obtainable in The United States of America.
On the average, hospitals and healthcare 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, Medicare and Medicaid are responsible for the payment.
In view of that, it is easier for hospitals and healthcare service providers to bill their clients based in their discretions. However, in some cases hospitals and healthcare service providers also adopt the hourly billing cum per visit billing method.
For example, it is easier and preferable for hospitals and healthcare services providers to bill personal injury case management services by the hour as against a fixed price.
- Payment Options
At Joan & Phil® Hospital, LLC, our payment policy is all inclusive because we are quite aware that different people prefer different payment options as it suits them. Here are the payment options that will be available in every of our outlets;
- Payment by cash
- Payment via Point of Sale (POS) Machine
- Payment via online bank transfer (online payment portal)
- Payment via Mobile money
- Check (only from loyal customers)
In view of the above, we have chosen banking platforms that will help us achieve our payment plans without any itches.
13. Startup Expenditure (Budget)
If you are looking towards starting a hospital, then you should be ready to go all out to ensure that you raise enough capital to cover some of the basic expenditure that you are going to incur. The truth is that starting this type of business does not come cheap.
You would need money to secure a standard hospital facility, you will need money to acquire medical equipment and supply and you would need money to pay your workforce and pay bills for a while until the revenue you generate from the business becomes enough to pay them.
Besides it is expensive to acquire a standard well – equipped ambulance. The items listed below are the basics that we would need when starting our hospital in the United States, although costs might vary slightly;
- The Total Fee for Registering the Business in the United States – $750.
- Legal expenses for obtaining licenses and permits – $1,500.
- Marketing promotion expenses for the grand opening of Joan & Phil® Hospital, LLC 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.
- Cost for hiring Business Consultant – $2,500.
- Cost for Computer Software (Accounting Software, Payroll Software, CRM Software, Microsoft Office, QuickBooks Pro, drug interaction software, Physician Desk Reference software) – $7,000
- Insurance (general liability, workers’ compensation and property casualty) coverage at a total premium – $3,400.
- Cost for payment of rent for 12 month at $1.76 per square feet in the total amount of $105,600.
- Cost for hospital remodeling (construction of racks and shelves) – $20,000.
- 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) – $300,000
- The cost for Start-up inventory (stocking with a wide range of products) – $150,000
- Storage hardware (bins, rack, shelves,) – $3,720
- Cost for Nurse and Drugs Supplies (Injections, Bandages, Scissors, et al)- $3,000
- Cost for medical equipment – $300,000
- Cost of purchase of ambulance and other vehicles : $100,000
- The cost for the purchase of furniture and gadgets (Computers, Printers, Telephone, TVs, tables and chairs et al): $4,000.
- The cost of Launching a Website: $700
- Miscellaneous: $10,000
We would need an estimate of $1.2M to successfully set up our hospital in Miami Beach – Florida. Please note that this amount includes the salaries of all the staff for the first month of operation.
Generating Funding / Startup Capital for Joan & Phil® Hospital, LLC
Joan & Phil® Hospital, LLC is a private business that is solely owned and financed by Dr. Phil Clarkson and his wife Joan Clarkson (Nurse). They do not intend to welcome any external business partners, which is why he has decided to restrict the sourcing of the start – up capital to 3 major sources.
These are the areas Joan & Phil® Hospital; LLC intends to generate our start – up capital;
- Generate part of the start – up capital from personal savings
- Source for soft loans from family members and friends
- Apply for loan from my Bank
N.B: We have been able to generate about $200,000 ( Personal savings $150,000 and soft loan from family members $50,000 ) and we are at the final stages of obtaining a loan facility of $1M from our bank. All the papers and document have been signed and submitted, the loan has been approved and any moment from now our account will be credited with the amount.
14. Sustainability and Expansion Strategy
The future of a business lies in the numbers of loyal customers that they have the capacity and competence of the employees, their investment strategy and the business structure. If all of these factors are missing from a business (company), then it won’t be too long before the business close shop.
One of our major goals of starting Joan & Phil® Hospital, LLC is to build a business that will survive off its own cash flow without the need for injecting finance from external sources once the business is officially running.
We know that one of the ways of gaining approval and winning customers over is to offer our healthcare services a little bit cheaper than what is obtainable in the market and we are well prepared to survive on lower profit margin for a while.
Joan & Phil® Hospital, LLC will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our organizations’ corporate culture is designed to drive our business to greater heights and training and retraining of our workforce is at the top burner.
As a matter of fact, profit-sharing arrangement will be made available to all our management staff and it will be based on their performance for a period of three years or more. We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
Check List / Milestone
- Business Name Availability Check:>Completed
- Business Registration: Completed
- Opening of Corporate Bank Accounts: Completed
- Securing Point of Sales (POS) Machines: Completed
- Opening Mobile Money Accounts: Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Leasing of facility and remodeling the facility: In Progress
- Conducting Feasibility Studies: Completed
- Generating capital from family members: Completed
- Applications for Loan from the bank: In Progress
- Writing of Business Plan: Completed
- Drafting of Employee’s Handbook: Completed
- Drafting of Contract Documents and other relevant Legal Documents: In Progress
- Design of The Company’s Logo: Completed
- Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
- Recruitment of employees: In Progress
- Purchase of Medical Equipment and Ambulances et al: In Progress
- Purchase of the Needed furniture, racks, shelves, computers, electronic appliances, office appliances and CCTV: In Progress
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business both online and around the community: In Progress
- Health and Safety and Fire Safety Arrangement (License): Secured
- Opening party / launching party planning: In Progress
- Compilation of our list of products that will be available in our pharmacy store: Completed
- Establishing business relationship with vendors (wholesale pharmaceutical companies): In Progress .
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Medical Clinic Business Plan Sample
The demand for health care is constant in spite of changes in the economy across the globe. Starting a professional clinic will help promote the health and wellness of the community that you live. You also get the opportunity to make money doing what you love, providing quality health care services
To ensure that your plan succeeds, you need to hire a professional to write your business plan for a medical clinic . OGS Capital is a reputed company that specializes in providing medical clinic business plan writing services. Our professionals have vast hands-on experience and are members of professional bodies, so you can be sure that you will get value for the money and time that you invest in this project.
The plan summary is also referred to as an abstract. It should be placed at the start of the medical clinic business plan to give readers an idea of the clinic that you intend to establish even before they start perusing through the other pages.
It Is imperative to make sure that all facts that you include in this section are factual to paint a positive image to the target audience. Some of the details of your clinic that you should include in this section are clinic’s name, mission statement, and objectives.
Our team will help you create this section to give your business plan for a medical clinic an upper hand when you present it to potential investors . We will also give you additional facts to enable you set up the clinic successfully.
- How to market your health care services
- How to hire employees
- How to build and retain your credibility and reputation
In certain businesses, the location is critical and to some extent this applies to a medical clinic. Easy access to the clinic is important, so being close to main highways is a consideration.
Car parking facilities for your clients and visitors will also need to be considered. This could be part of the business or a nearby private car park.
Another important consideration is visibility. Your medical center can act as a superb billboard in the right location.
Your business plan for a medical clinic should cover all these points and more.
Health is a growing business and there are plenty of competitors. Your medical clinic business plan should describe your closet competitors and why they are successful.
The plan will also explain what your business will do differently to stand out from the competition. One easy way of doing this is by using a competitor matrix. Make a list of competitors and then columns for attributes. This is an easy way to compare your business to the competitors.
The business plan for a medical clinic needs to describe how your business is structured from the top down. If it’s an existing business, include a brief history of the company.
You should also describe the legal structure and ownership of your company, whether sole-trader, partnership or limited company.
You may also need to include information on the mission statement, intellectual property and the business location.
Your marketing plan needs to consider several topics, including where your business is positioned in the market, your pricing structure and how you plan to promote the business.
Is the business focussed on offering value for money or is it aimed at the high-end of the market. There are many pricing strategies, and your medical clinic business plan pdf should identify which strategy you intend to implement and why.
Using our medical clinic business plan template , describe the products and services your business will offer.
How do your planned products and services meet the needs of your target market. Do your competitors offer similar products, and if so, why will your business stand out?
In the medical business there is constant change, so include how your medical clinic business plan will plan to find and offer new products and services.
The key members of the management team should be identified and their role described. This should also include details of why they are suitable for that particular role. Don’t forget to identify other important members of your team.
You can include brief bios with details of their experience and education.
Using our free sample business plan for a medical clinic to guide you.
The financial plan provides precise details on how you will get the capital to start the clinic. The financial plan also goes the extra mile to highlight how the money will be spent.
It is important to make sure that the plan is accurate as simple mistakes could cost your potential business investors. Our financial experts will work on this section to ensure that the medical clinic business plan is foolproof and capable of starting and safeguarding it from financial challenges down the road.
There are regulations that govern establishing of health care clinics. You need to adhere and follow the stipulated processes to get all the necessary accreditation documents.
The investors need to know that you have what it takes to start a health clinic, and so it is imperative to provide details of how you intend to complete the registration process.
We have professional business plan writers in the health care sector that can help you understand the registration process to overcome the challenges along the way. Our medical practice business plan template will ensure you produce the perfect medical clinic business plan .
How to order writing business plan medical clinic
Get in touch with us today for more details on how we can write a medical clinic business plan example for you by filling the contact us form. We look forward to working on your medical clinic business plan .
Download Clinic Business Plan Sample in pdf
Professional OGS capital writers specialized also in themes such as dental practice business plan , wellness business plan , senior center business plan , reiki practice business plan , pharmacy business plans , occupational therapy business plan and many others.
OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.
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