1. Business Planning Essentials

2. Core Elements of Business Planning 1. Environmental Assessment 2. Strategies/Tactics for Growth 3. Volume Projections 4. Staffing and Other Resource Needs 5. Financial Analysis

3. 1. Environmental Assessment Internal Environment National Trends Local & Regional Environment

4. Internal Environment Volume Patient Origin Referring Providers Payor Mix Financial Performance Staffing Downstream

5. Local and Regional Environment Market Size and Growth Primary Competitors ◦ Volume ◦ Physician/Educator Supply ◦ Payor Mix ◦ Service Offerings Market Share Payor/Reimbursement Trends

6. Growth of healthcare costs Healthcare reform Increasing demand for services Reduced escalation in payment levels Increased focus on clinical outcomes Inpatient  Outpatient Provider consolidation & service regionalization National Trends

7. SWOT Analysis Strengths - Internal - Resources and capabilities that can be used in developing a competitive advantage Weaknesses - Internal - Characteristics about your clinic that place it at a disadvantage relative to competitors Opportunities - External - Elements in the environment that create potential for growth Threats - External - Elements in the environment that could create problems

8. 2. Strategies/Tactics for Growth Strategies and Tactics for Growth Techn- ology Patient Origin National Trends Compe- titors Regula- tions Payor Mix Financial Perfor- mance Referring Providers Local & Regional Trends

9. 3. Volume Projections Should build on: ◦ Environmental Analysis  What is the demand?  What is the projected incidence in the community?  Impact of regulations  Impact of competitors ◦ Clinician capacity

10. Supply vs. Demand Example Population in Service Area2,242,988 Prevalence Rate of Diabetes8.3% Portion of Patients Requiring an Endocrinologist10% Population Requiring an Endocrinologist 18,617 Number of Endocrinologists in Service Area5 Number of Patients per Endocrinologist2,500 Unmet Need6,117 Incremental Endocrinologists Required2.45

11. 4. Staffing & Other Resource Needs Resulting from: ◦ Increased Volume ◦ Changes in Practice Models ◦ New Technology May Include: ◦ Physicians ◦ Nurse Practitioners ◦ Educators ◦ Support staff ◦ Equipment ◦ Space

12. 5. Financial Analysis Revenue generated from incremental: ◦ Clinic visits ◦ Educations visits Costs associated with incremental: ◦ Physicians ◦ Support staff ◦ Equipment