Business Planning of Health Organizations in a Private Healthcare System - Economics and Management in Health Care

Business planning of health organizations in a private health care system

A business plan is a document describing all the main aspects of the activity of a medical organization, analyzing the problems that it may encounter and determining the ways of solving these problems. The business plan includes the development of the project goal, the evaluation of the actual economic indicators of the organization, market analysis and customer information, the definition of a competitive strategy for achieving the goals.

The period of time for which a business plan is developed is 3-5 years. For the first year, the main economic indicators need to be calculated in more detail, and for the next years a forecast calculation of the main indicators is sufficient.

Drawing up a business plan involves the following sequence of actions:

1) determining the mission of the organization and the goal that must be achieved through the implementation of this business plan;

2) an assessment of the organization's ability to perform tasks in accordance with the goal;

3) identification of the types of medical and service services that will be the task of this project;

4) study of the market segment on which the service data is realized;

5) solving organizational issues of planned commercial activities, determining the location of the organization;

6) development of a production plan;

7) developing a marketing plan;

8) development of an organizational plan related to governance and property rights;

9) defining parameters and developing a financial plan;

10) assessment of risks not excluded in the implementation of this project;

11) preparing a resume for the business plan, which is the last one, but is, nevertheless, the first section of the business plan.

In order to develop an effective business plan, it is necessary to analyze the external environment and the actual state of the medical organization as an internal business environment.

In analyzing the external environment, the development of the healthcare and the medical services market, the state of competition, the characteristics of the consumers of health services - their incomes, needs and social status, the development tendencies of the external environment, outside the control of the medical organization, but which may influence its activities .

The internal environment of a medical organization is characterized by the quality of marketing activities, financial capabilities, characteristics of production activities, human resources and quality of administration.

The approximate structure of a business plan includes the following sections:

Section 1. Summary or brief overview of the project. This part is a short and capacious presentation of the plan with an emphasis on the real merits of the health organization for potential investors, the definition of a mission, goals and objectives. Particular attention in this section should be focused on the question: how is the medical organization going to return money to investors, at the expense of what future income?

Section 2. Description of services. This section should describe in detail the types of medical services that will be offered to the consumer. It is necessary to show what the attractiveness of these services is and what is unique for a potential consumer.

Section 3. Description of the external environment and the state of affairs in the industry. In this part, it is important to pay attention to the trends in the development of health care and the compliance of the activity of this medical organization with the tasks of the industry. To characterize the federal laws in the sphere of public health and business, tax conditions and other factors of the external environment that influence the attainment of the stated goal of the business plan of this medical organization.

Section 4. Assessing competitors and choosing a competitive strategy.

In this paragraph, you should determine the advantages of your organization in comparison with competitors, for example, leadership in quality, lower costs, specialization, uniqueness of the market supply.

Section 5. Organizational plan. In this section, you need to indicate the needs of the medical organization in the room, equipment, labor resources necessary to provide the proposed medical services.

Section 6. Marketing plan. The main provisions of this section: pricing, the system of promotion of services on the market, the growth strategy of services of a medical organization.

Section 7. Management and property rights. This section specifies:

• organizational and legal form of the medical organization, its advantages and features;

• Information on state registration;

• Organizational management structure of the organization;

• Distribution of responsibilities between the heads of services and units of the medical organization;

• Features of intergovernmental fiscal relations with regional authorities and other state institutions.

Section 8. Financial plan. In this section, calculations of the main financial indicators are presented, the requirements for financial resources, financial results of the past and for the future are determined; cost structure, breakeven threshold; volumes of sales of medical services in monetary terms; balance of income and expenses, profit margin.

Section 9. Insurance of risks. This item provides an assessment of the risk level of the proposed project in the business plan. Risks can be of the following types: financial and economic, technical, social. The purpose of this section is to show potential investors that the medical organization has identified ways to insure risks.

Thus, the business plan is a kind of model for the future activity of a medical commercial organization that is based on the principles of a market economy.

The self-analysis of a medical organization is conducted on the basis of:

1) gathering information about finances, material and technical base of units;

2) evaluation of staffing by skill level, age, length of service;

3) study the demand of the population for the medical services offered in the business plan.

It is necessary to use materials of observing the leaders of the market environment, organized in the framework of benchmarking, which offer various innovations. Most innovations in the service sector, including health care, are offered by potential consumers (patients). In this regard, the integration of research and innovation functions is needed and within the framework of marketing activities - the search for innovation. The choice of an innovative idea should be conducted in conditions of a plurality of options, taking into account the patients' solvency. The result of this activity can be the development of a new medical service, and the criterion of choice is social and economic efficiency, improving the health of the population. Services of a preventive orientation are especially actual now. The process of formation by the medical organization of market prices for its services includes the following stages:

1) setting pricing tasks;

2) definition of demand;

3) cost estimation;

4) conducting analysis of prices and services of competitors;

5) choice of the pricing method;

6) determination of the final price and the rules of its future changes;

7) accounting measures of state price regulation;

8) Development of a discount system.

In section 3, "Description of the external environment, state of the art in the industry" conducted BIGOT - analysis, giving answers to questions:

1) what are the "strong points" medical organization?

2) what are its "weak points" and how to fix them in the future?

3) which "quotas" & quot; contribute to the achievement of the goal of the business plan?

4) what are "threats", i.e. problems, require permission now and in the future, prevent the implementation of the intended?

When drawing up Section 9 of the business plan, one should bear in mind that the group of financial and economic risks are:

• Demand volatility;

• the emergence of alternative services;

• reduction of prices by competitors;

• increase the production of medical services from competitors;

• Increase in taxes, solvency of consumers;

• rising prices for materials;

• Lack of working capital.

To social risks are:

• difficulties in recruiting skilled workers and junior staff;

• the attitude of regional authorities to the development of business;

• Inadequate salaries for medical and support workers.

The most significant in the technical risks group are:

• Weariness of the equipment;

• Material quality instability.

The business plan is an obligatory component of the planned activity not only of a commercial but also of a budgetary health organization offering paid medical and service services to the population, it describes all the main aspects of the medical and production process. The work on business planning can be presented in the form of the following program of actions (Table 15.1):

Table 15.1

Program for developing and implementing a business plan in an organization


Work Title

Materials, documents



1. Preparatory work

1.1. Analysis of the current statistical information of the medical institution

The form of recording the movement of patients and beds




1.2. Analysis of the incidence and prevailing structure of medical care

Report on the incidence of the population and the structure of medical care

Methodical group

1.3 Analysis of the local market environment

Analytical report on key performance indicators

Economic Service

1.4. Analysis of organizational structure

Report on institutions and commercial health organizations providing similar services

Economic Service

1.5. Analysis of the information base

Report on the results of the information gathering activity

Economic Service

1.6. Analysis of labor relations and personnel structure

Report on the effectiveness of the use of labor resources by a medical organization

Human Resources, Economic Service

Continuation of Table. 15.1

Work Title

Materials, documents



1.7. Analysis of the financial performance of health care institutions

The balance sheet and its annexes

Bookkeeping, economic service

1.8. Organization of control over the performance of preparatory operations

Business plan development program


2. Business plan development

2.1. Definition of the goal (mission) and tasks of the health care institution

Analytical note of the economic service


2.2. Analysis of the effectiveness of the use of the facilities of health care institutions

Analytical Report

Administrative and economic part (AHCH), economic service, accounting

2.3. Analysis of demand for a specific medical service, description of the service

Analytical Report

Economic Service, Marketing Department

2.4. Analysis of the offer of a specific service

Analytical Report

Economic Service, Marketing Department

2.5. Analysis of competitors and the competitive environment. Competitiveness assessment

Analytical Report

Economic Service, Marketing Department

2.6. Calculation of the cost of services

Report on the implementation of the budget estimates of expenditures and revenues, information on the deflator, information on the prices of competitors

Economic Service

2.7. Calculating the need for medical personnel and calculating the wage fund

Calculations and business case

Economic Service, Human Resources

2.8. The analysis of the profitability of the chosen service

An analytical note on the demand for this medical service, on the offering of this service by competitors, on the solvency of the population, on the structure of the population, etc.

Economic Service, Marketing Department

End of Table. 15.1

Work Title

Materials, documents



2.9. Calculation of profitability threshold and prices for medical services

Calculation and business case

Economic Service, Marketing Department

2.10. Drawing up a marketing plan

Analytical reports and notes

Economic Service, Marketing Department

2.11. Drawing up a summary, production plan, organizational plan, financial plan, risk assessment, expected results

Administration, Economic Service

3. Implementation of the business plan and control over its implementation

3.1. Organizational and medico-economic control

Orders, orders of the administration, standards of medical care, schedule of control checks

Administration, Economic Service

3.2. Reports on the implementation of business plan sections

Minutes of meetings, conference materials, texts of information messages


The whole planning process can be presented in the form of a scheme that, starting with the analysis of the activity of the medical organization, looks like a continuous closed loop (Figure 15.1):

Fig. 15.1. Planning process in a medical organization

The program of actions for the development and implementation of the business plan should reflect all the mentioned periods of the cycle. Implemented on the basis of a comprehensive analysis, current planning is an important lever of the economic mechanism for managing a medical organization.

The types of business plans include:

1) an investment business plan, the purpose of which is to attract financial resources to the organization;

2) an innovative business plan aimed at assessing the possibilities of developing new technologies, changing the process of providing medical and service services;

3) An analytical business plan evaluating the overall development of the existing medical organization.

For example, the innovative business plan should reflect the medical and technological design and equipment of the medical organization, a general description of the health infrastructure of the region and an analysis of the requirements for a new medical institution or organization in accordance with medical objectives and general situation. Mandatory components of the business plan should be the calculation of the required area, an estimate of the final construction costs, the cost of equipment for each office, the amount of financing and running costs, the calculation of the workload of offices, the calculation of revenues, the resulting profit and payback.

The structure of the population is also important for determining the future health care needs of this medical organization. For example, the main population of the city is represented by persons of working age (57%), but 22% of residents are pensioners and 21% of children. At the same time, persons of pension age are 2.3% more residing in rural areas than in the cities of the given territory; Also in rural areas, 1.8% more than in cities, children live. With the help of such an analysis, potential consumers are identified in order to take into account their specifics in the activity of the medical organization.

Next, we'll look at ways to reduce production, commercial and other risks that must be anticipated and reflected in the business plan.

Production risks are associated with various violations in the medical process or in the process of supplying materials and medical products. Measures to reduce production risks are effective control over the course of the treatment process and increasing the influence on resource providers through diversification and duplication of suppliers, the use of import substituting components and medical products, etc.

Commercial risks are associated with the implementation of nursing services, namely, with a decrease in the size and capacity of the market, a decrease in effective demand, the emergence of new competitors, etc. Measures to reduce commercial risks can be:

• a systematic study of the market situation of medical services and medical supplies;

• flexible pricing policy;

• creating a positive public opinion and corporate identity of the health care institution;

• socially directed advertising (for example, a reminder of vaccination against influenza, etc.).

Financial risks may be caused by inflationary processes, breach of contractual obligations by partners, etc. They can be reduced through the use of the principles of financial management by the management of the medical institution, the introduction of management accounting along with accounting, training of personnel in the economical use of resources. In pricing risks can be reduced if the costs are correctly taken into account and the deflator used to adjust the calculations, which will contribute to the financial stability of this organization.

There may be unforeseen risks associated with force majeure circumstances (natural disasters, drastic changes in legislation, etc.). Measures to reduce them are the work of the organization with a sufficient stock of financial strength - high liquidity and a high coefficient of autonomy, when a special insurance fund is created for similar developments.

In order to reduce the overall impact of risks on the effectiveness of the health care institution, it is necessary to provide for commercial insurance under the existing insurance systems (property insurance, transportation, risks inherent in commercial contracts for transactions, reinsurance, etc.).

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