Industries

To be competitive, you must constantly assess new opportunities and programs, balancing demand with affordability and potential return on investment. When
considering a new program, you must accurately determine the nature of the service to be provided, as well as its costs and potential revenue.

To assess the feasibility of a new program, you should consider the following questions

• How large is the population of the market area? Will the new program increase the geographic scope of the market area?
  
• What are the age and demographic characteristics of the current and future population?
  
• What are the normal use rates of the program being evaluated?
  
• Which environmental or technological factors are likely to impact future use?
  
• What are the facility, equipment and other capital requirements of the project? How much equity will be required?
  
• What does the competitive landscape look like? Are there new competitors entering the market?

The Healthcare Services Team of RSM McGladrey assists healthcare organizations across the country to answer these and other related questions. Our team of experienced consultants has generated feasibility studies for a variety of programs, from replacement hospitals to assisted living centers, and we conduct ongoing research to remain current with clinical trends and technology assessments. We help organizations determine the economic feasibility of a project by helping them to
accurately predict the volume of services that will be consumed by the program, project the costs of operating the project and determine the capital investment required to initiate the project.

Our Approach
Through our multidimensional model for projecting demand, we assist you with predicting inpatient admissions and days by clinical service or product line. Applicable to ambulatory, acute and post-acute care settings, this model projects future volumes of diagnostic and treatment services to be used by inpatients and outpatients.

First, we translate the volume projections into space requirements and medical equipment needs. Using regional or local cost benchmarks, we are able to estimate
the construction and project costs associated with the program being studied.

Then, we take the volume projections, in conjunction with your current staffing and payroll structures, and create an operating model for the new program. This model can then be used for generating operating costs of the program.

Finally, we incorporate all of this information, along with reimbursement projections and payer mix assumptions, into a set of pro forma financial statements.

Our Program Feasibility Assessment services support timely and informed decision-making throughout the planning, design and construction process – resulting in an objective evaluation of a project’s feasibility, one that balances facility needs with strategic, operational and financial objectives.

Contact
James E. Hosking, FAAHC, FHIMSS, CHE
Managing Director
312.634.7104

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