Fsj long term healthcare solutions partnership committee research study final report

Fort St. John Long Term Healthcare Solutions Partnership Committee Research Study Final Report

May 2015

Table of Contents Page No. Project Drivers…………………………………………………………………………………………………………

3

Project Approach……………………………………………………………………………………………………...

6

Findings…………………………………………………………………………………………………………………

9

ABC & FSJ Family Medical Clinic Operating Expense Analysis……………………………………...

9

Other Clinics……………………………………………………………………………………………………

17

Physician Demand…………………………………………………………………………………………….

21

Closing the Gap………………………………………………………………………………………………………..

23

Clinic Model Options…………………………………………………………………………………………

23

Clinic Space…………………………………………………………………………………………….

24

Capital and Operating Financial Requirements………………………………………………….

25

Criteria Analysis………………………………………………………………………………………………

30

Other Vendors…………………………………………………………………………………………………

35

Conclusions…………………………………………………………………………………………………………....

36

Next Step Considerations……………………………………………………………………………………………

40 2

Project Drivers •

Increasing population in Fort St. John and surrounding area –

•

Forecast to continue increasing with significant economic development in area

Decreasing physician/population ratio –

Challenges with physician recruitment

•

Access to appropriate primary care increasingly challenging

•

Existing clinics in town –

Suitability for long-term solution uncertain • Clinic fee structures suspected to be impeding ability to recruit new physicians • Space availability

3

Project Drivers •

How to attract, recruit and retain family practitioner's?

Solutions Committee’s Role

–

Solution needs to address short and medium term need, but must also be sustainable in the long term

–

Requires valid and credible data upon which to base decisions

–

Solution needs to be developed collaboratively with all stakeholders:

MNP’s Role

• Northern Health • BC Ministry of Health • City of Fort St. John

Negotiation

• Physicians • Industry • Industry Associations (Doctors of BC) • etc….

4

Project Work Plan Recommend Stopping Here Project Phases and Stages Understanding the Issues

Project Definition

Needs Research

Phase III Phase II Reporting Developing Solutions Developing Options Business Plan Reporting

Gap Analysis

Detailed Research

Option Analysis

Business Plan Development

Business Plan Validation

Negotiated decision required before business plan can/should be developed 5

Project Approach (General) •

MNP has completed multiple capital asset driven business planning projects in the health sector and have come to understand that there is a basic framework that if applied appropriately will result in valid and defensible data

Need

drives

Function

Form

drives

drives

Cost

6

Project Approach (Detail) 1.

Collected and completed analysis of operating expense financial data from both ABC Clinic and Fort St. John Family Medical practice

2.

Consulted and/or received information from representatives of: –

Northern Health

–

BC Ministry of Health

–

ABC Medical Clinic

–

Fort St. John Family Practice Clinic

–

Resident Physicians

–

MLA Pat Pimm

–

Private Health Service Providers/Vendors • • • •

Live Care IRIDIA MEDEO Ultima Medical

–

Long Term Solutions Committee (Meeting Minutes)

–

Agassiz Medical Clinic (rural Manitoba)

–

Kelowna based Medical Clinic

–

Ontario based Medical Clinics (urban and rural)

–

Ms. Elke Haggerty (Citizen)

7

Project Approach (Detail) 3.

Developed four (4) capital options

4.

Developed financial models to assess options

5.

Developed criteria to assess options against

6.

Documented assessment and findings

8

Findings – Operating Expense Analysis •

Each clinic provided detailed operating expense and revenue information

•

Overheads at both clinics cover similar elements including Legal Costs

Supplies

Insurance

Rent

Utilities

Office Supplies

Lab and nursing supplies

Computer Costs

Dues and Licenses

Common Costs

Food and Entertainment (staff events)

Repairs and Maintenance

Interest and Bank Fees

Miscellaneous

Reception

Medical Office Assistants

Stenography

Filing

Billing

Lab Assistants

Payroll

Office Administration

Bookkeeping 9

Findings – Operating Expense Analysis

Clinic Comparison

ABC Medical Clinic

Fort St John Family Practice

Non-Financial Details Personnel Physicians (Permanent) Locums/Other Support Staff FTEs Clinic Square Footage Square Feet Per Person Square Feet Per Perm Doctor

18 6 12

19 6 4 9

4,720 262 787

5,645 297 941

10

Findings – Operating Expense Analysis •

Both Clinics participate in the BCMA Rural Retention Program which provides a 23.3% fee premium on all billings, and a $22,922 flat annual supplement

•

All family physicians currently at ABC or FSJ Family Practice are participating in this program

Clinic Comparison Revenue Overhead Permanent Locum/Other

ABC Medical Fort St John Clinic Family Practice $ 897,959.83 $ 907,200.00 897,959.83 730,020.93 167,938.90

907,200.00 864,000.00 43,200.00

11

Findings – Operating Expense Analysis Clinic Comparison Expenses

ABC Medical Fort St John Clinic Family Practice $ 934,605.29 $ 759,794.00

Human Capital Payroll Legal & Accounting

704,892.10 704,892.10

440,858.00 432,110.00 8,748.00

Facilities Rent Utilities Property Taxes Lease Insurance Leasehold Improvements Repairs and Maintenace Janitorial Parking Lot Maintenance

108,174.13 61,020.00 11,477.02

194,100.00 113,400.00 9,960.00 38,400.00

3,780.00 1,860.00 7,407.11 24,490.00

4,200.00 22,680.00 3,600.00 12

Findings – Operating Expense Analysis Clinic Comparison Expenses Medical Medical Supplies Courier to Hospital Office Administration Computer Telephone New Telephone system Office Supplies Petty Cash/Misc Food and Entertainment Risk & Future Expenses Depreciation Professional Fees Bank Charges Dues & Licenses

ABC Medical Fort St John Clinic Family Practice $ 934,605.29 $ 759,794.00 29,322.58 27,396.00 29,322.58 24,996.00 2,400.00 91,376.93 41,016.87 4,172.69 14,152.93 29,684.89 2,349.55

81,084.00 37,920.00 15,960.00 19,104.00 5,460.00 2,640.00

-

10,800.00 10,800.00

839.55 839.55

5,556.00 4,800.00 756.00

13

Findings – Operating Expense Analysis Per Unit Analysis

Item Support staff FTE/Physician Average Payroll/FTE Rent/Sq. Foot Utilities/Sq. Foot Sum Rent & Utilities/Sq. Foot Janitorial/sq. ft.

Supply/Service cost/physician Office admin/physician

ABC Medical Clinic 2 $58,741.01 $12.93 $2.43 $15.36 $5.19 $4,887.10 $15,229.49

FSJ Family Practice 1.5 $48,012.22 $20.09 $1.76 $21.85 $4.02 $4,566.00 $13,514.00

14

Findings – Operating Expense Analysis Overhead Analysis

Line Item

ABC Medical Clinic

Fort St John Family Practice

Overhead Collected (Revenue) Clinic Operating Expenses Excess (deficit) Overhead Collected

$ $ $

897,959.83 $ 934,605.29 $ (36,645.46) $

907,200.00 759,794.00 147,406.00

Revenue Available to Return to Physicians Number of Physician Physician Annual Return (extra $ call) Physician Monthly Return (extra $ call)

$

(36,645.46) $ 6 -$6,108 -$509

147,406.00 6 $24,568 $2,047

Monthly Reported F/T Physician Overheads Monthly Reported Locum Overheads

$

10,000.00 $ 13,994.91

12,000.00 3,600.00 15

Findings – Operating Expense Analysis Revenue Summary •

Revenues (overhead collected) essentially net the same for both clinics, however ABC’s F/T physicians are contributing less/month due to higher locum overhead contributions –

FSJ Family Practice has collected excess overheads from F/T physicians that equal approximately $2,047/month/physician

–

If this amount were distributed back to physicians both clinics would essentially be having their physicians contribute $10,000/month

Expense Summary •

ABC Clinic has significantly higher staff expenses due to higher staff numbers and higher average payroll/FTW (countered by higher locum revenue)

•

FSJ Family Practice has significantly higher rent and utilities expense on a per square foot basis (countered by lower staff expenses)

•

All other expense categories essentially equal to one another when netted

16

Findings – Other Clinics Other Clinic/Jurisdictions •

For comparison, we collected overhead data from four other clinics in BC, Manitoba and Ontario

•

All four of these clinics utilize a percentage based overhead calculation rather than a flat monthly amount

•

Three of the four clinics charge a monthly amount equal to between 30% - 40% of billings – –

•

In this model, a physician billing $300,000/year would pay between $7,500 - $10,000/month In this model, a physician billing $500,000/year would pay between $12,500 - $16,666/month

One of these clinics utilizes a tiered system – – –

27% ($0 - $299,999) = $6,750/month 24% ($300,000 - $499,999) = $4,000/month 10% ($500,000 +)

• In this model, a physician billing $300,000 would pay $6,750/month • In this model, a physician billing $499,999 would pay $10,750/month •

We calculated the monthly overhead a physician at each of the two clinics would pay using the 30%, 40% and tiered methods (utilized an average of physician billings) 17

Findings – Other Clinics Source: Medical Services Commission Financial Statement to March 31, 2014 ABC Clinic

Monthly Overhead @ 30%

Monthly Overhead @ 40%

FSJ Family Practice

Monthly Overhead @ 30%

Monthly Overhead @ 40%

$501,000

-

-

$464,000

-

-

$629,000

-

-

$435,000

-

-

$865,000

-

-

$432,000

-

-

$447,000

-

-

$603,000

-

-

$241,000

-

-

$607,000

-

-

$112,000

-

-

$391,000

-

-

Average

-

-

Average

-

-

$465,833

$11,645

$15,527

$488,666

$12,216

$16,288

•

Note, those physicians earning higher/lower than average would pay significantly more/less under this method than the current flat amount method

18

Findings – Other Clinics Source: Medical Services Commission Financial Statement to March 31, 2014 • • •

•

27% ($0 - $299,999) 24% ($300,000 - $499,999) 10% ($500,000+) ABC Clinic

Monthly Overhead (Tiered Method)

FSJ Family Practice

Monthly Overhead (Tiered Method)

$501,000

-

$464,000

-

$629,000

-

$435,000

-

$865,000

-

$432,000

-

$447,000

-

$603,000

-

$241,000

-

$607,000

-

$112,000

-

$391,000

-

Average

-

Average

-

$465,833

$10,066

$488,666

$10,523

Note, those physician earning higher/lower than average would pay significantly more/less under this method than the current flat amount method

19

Findings – Operating Expense Analysis Conclusions •

Overhead rates historically charged at both ABC and FSJ Family Practice clinics do not appear to be significantly higher than other clinics researched

•

FSJ Family Practice appears to have excess revenue collected from overheads that could be returned to physicians, effectively reducing monthly overhead to just under $10,000/month

•

ABC Clinic has successfully reduced monthly physician overhead to $10,000/month by reducing staffing levels and supplementing income with locum overhead revenue (note this practice is changing more recently with less locums being used)

•

Utilizing percentage based, or tiered percentage based methods to calculate overheads would result in higher overhead amounts for the majority of physicians practicing at both clinics (based on historical billing patterns), and significantly lower overhead amounts for a minority of physicians currently practicing at both clinics

•

Utilizing a percentage based, or tiered percentage based method to calculate overheads allocates more or less overhead based on the amount billed by each physician –

•

These methods attempt to allocate revenue based on amount of resources utilized (i.e. more billings, means more consumable used, more staff time utilized, etc.)

Utilizing a percentage based, or tiered percentage based method to calculate overheads allows for physicians to “slow down” or “speed up” their practices with a corresponding adjustment to their overheads 20

Physician Demand •

In January 2015 there were effectively 13 family physicians with active office practices in Fort St. John

– – –

6 ABC Clinic 6 FSJ Family Practice (2 leaving in July 2015) 1 Northern Health Unattached Clinic

•

There will be 4 IMG positions starting at the Northern Health Unattached Clinic in 2015 (1 in July and 3 in September). This physicians are participating in Northern Health’s Practice Readiness Assessment Program

•

By September 2015 there is expected to be 15 family physicians with office practices in Fort St. John

•

Northern Health’s Human Resources Master Plan approved by the Northern Health Board in 2006, projected a need for 31 general practice physicians in Fort St. John by 2010/2011

•

Northern Health is currently in the process of finalizing a Physician Human Resource Plan with updated general practice physician demand numbers, which are anticipated to be similar to that documented in the 2006 Northern Health Human Resources Master Plan

Projected September 2015

15

Current Demand

At Least 31

21

Physician Demand •

There is a projected immediate need for at least an additional 16 general practice physicians with office practices in Fort St. John to a total of 31

•

This projected demand for physicians formed the basis of the four options MNP developed models for

22

Closing the Gap – Clinic Model Options •

Identified 4 distinct clinic model space options 1.

2.

3.

4.

•

Developed financial models for each that allows for multiple variable manipulation – – – – – –

– – – – •

Build a new clinic(s) Purchase existing space (FSJ Family Clinic) Lease FSJ Family Clinic Lease other

Number of physicians Amount of space Amount of lease tenants Construction costs Land costs Clinic ownership • Equity contributions (non-repayable) • Equity contributions (investor) ROI Operating costs Lease rates Debt term and rate

Operating costs and associated physician overheads can then be assessed 23

Closing the Gap – Option Analysis •

Worksheet review

24

Closing the Gap – Option Analysis Summary Option 1 – Build New •

To accommodate 30 physicians and ‘campus of care’ model, 30,500 square feet of space is required

•

Capital development cost of $16M

•

Lease rate required to service debt is extremely high ($38.46/sq. ft.)

•

Non repayable equity contributions can reduce debt and accordingly lease rates, but requires contributions of $7M - $9M to reach lease rates comparable to existing clinic lease rates

•

Without equity contribution, results in monthly overhead of approximately $12,300/physician to cover operating costs without additional overhead subsidy

•

With equity contribution ($7M - $9M), results in monthly overhead of approximately $11,400 $11,200/physician to cover operating costs without additional overhead subsidy

25

Closing the Gap – Option Analysis Summary Option 2 – Purchase Existing (FSJ Clinic) •

Can accommodate 21 physicians and provides elements of a ‘campus of care’ model

•

Capital cost of $6M

•

Lease rate required to service debt are aligned with current and market rates ($20.72/sq. ft.)

•

Non repayable equity contributions can reduce debt and accordingly lease rates to below market rates

•

Without equity contribution, results in monthly overhead of approximately $11,225/physician to cover operating costs, without additional overhead subsidy

•

With equity contribution ($2M), results in monthly overhead of approximately $10,900/physician to cover operating costs, without additional overhead subsidy

26

Closing the Gap – Option Analysis Summary Option 3 – Lease FSJ Clinic •

Can accommodate 21 physicians and provides elements of a ‘campus of care’ model

•

Capital development cost of $700,000

•

Lease rate required to service debt are aligned with current and market rates ($22.56/sq. ft.)

•

Non repayable equity contributions can reduce debt and accordingly lease rates to below market rates

•

Without equity contribution, results in monthly overhead of approximately $11,350/physician to cover operating costs, without additional overhead subsidy

•

With equity contribution ($2M), results in monthly overhead of approximately $10,870/physician to cover operating costs, without additional overhead subsidy

27

Closing the Gap – Option Analysis Summary Option 4 – Lease Other Space •

To accommodate 30 physicians and ‘campus of care’ model, 30,500 square feet of space is required

•

Capital development cost of $3M

•

Lease rate required to service debt are aligned with current and market rates ($25.00/sq. ft.)

•

Non repayable equity contributions can reduce debt and accordingly lease rates to below market rates

•

Without equity contribution, results in monthly overhead of approximately $11,930/physician to cover operating costs, without additional overhead subsidy

•

With equity contribution ($2M), results in monthly overhead of approximately $11,600/physician to cover operating costs, without additional overhead subsidy

28

Closing the Gap – Option Analysis Summary Summary of Operational Costs for Each Scenario Scenario 1 30

Number of Physicians Practicing

Scenario 2 21

Operating Costs Building Rent Utilities Janitorial Medical Supplies/Services Office Administration Human Capital Bank Charges Accounting/Legal Fees Leasehold renos (Scenario 4) Total Expenses to Recover

$ $ $ $ $ $ $ $ $ $

Annual Overhead/Physician Monthly Overhead/Physician

$ $

147,757 $ 12,313 $

Forgiveable Equity Contribution Investor Contribution Annual Subsidy to Overhead

$ $ $

Reduced Annual Overhead/Physician Reduced Monthly Overhead/Physician

$ $

Annual Annual Annual Annual

$ $ $ $

subsidy subsidy subsidy subsidy

required for $11,000/month OH required for $10,000/month OH required for $9,000/month OH required for $6,000/month OH

908,027 35,415 94,912 137,100 405,000 2,782,500 27,750 42,000 4,432,704

590,250 41,554 94,912 137,100 405,000 2,782,500 27,750 42,000 175,168 4,296,234

134,685 $ 11,224 $

136,179 $ 11,348 $

143,208 11,934

- $ - $ - $

- $ - $ - $

- $ - $ - $

-

147,757 $ 12,313 $

134,685 $ 11,224 $

136,179 $ 11,348 $

143,208 11,934

$ $ $ $

353,683 30,043 68,621 95,970 283,500 1,947,750 19,425 29,400 2,828,392

56,392 308,392 560,392 1,316,392

$ $ $ $ $ $ $ $ $ $

Scenario 4 30

$ $ $ $ $ $ $ $ $ $

472,704 832,704 1,192,704 2,272,704

$ $ $ $ $ $ $ $ $ $

Scenario 3 21

$ $ $ $

385,041 30,043 68,621 95,970 283,500 1,947,750 19,425 29,400 2,859,750

87,750 339,750 591,750 1,347,750

$ $ $ $

336,234 696,234 1,056,234 2,136,234

29

Closing the Gap – Criteria Analysis •

In order to provide insight into what Clinic Model could be considered optimal, optimal must first be defined, quantified and qualified

•

As is the case with most decisions, multiple viewpoints and perspectives should be considered. It is rare that a single criterion is used to determine performance, rather it is more objective when a series of criteria are utilized

•

For the purpose of facilitating discussion and decision making, MNP developed seven performance criteria against which Clinic Model options could be measured

•

These criteria are felt to be representative of important elements the FSJ Long Term Healthcare Solutions Partnership Committee should consider in its decision making

•

MNP weighted each criteria

•

MNP recognizes that the FSJ Long Term Healthcare Solutions Partnership Committee may wish to modify these criteria, removing some or adding others, and may weight them differently, and has provided a model that allows for such changes

•

Using the criteria collectively is important as using any one criterion in isolation of the others limits the strength of conclusions that can be drawn

30

Closing the Gap – Criteria Analysis Weights Assigned

Criteria Minimizes monthly overhead for physicians Quickly meets physician demand requirements Minimizes capital investment required Recruitment and retention opportunies are maximized Presents a scalable solution Maximizes opportunity for 'campus of care' model Mimizes ongoing financial (operational) subsidy required Total

Criteria Scale

15.0% 5.0% 20.0% 20.0% 5.0% 15.0% 20.0% 100.0% Points

Strongly Meets

3

Partially Meets

2

Poorly Meets

1

31

Closing the Gap – Criteria Analysis Summary Option 1 Build New

Option 1 Build New

Points

Option 2 FSJ Clinic Own

Weighted Score

Option 2 Option 3 Option 3 Option 4 FSJ Clinic Own FSJ Clinic Lease FSJ Clinic Lease Lease Other

Minimizes monthly overhead for physicians

1

0.15

3

0.45

3

0.45

2

Quickly meets physician demand requirements

3

0.15

2

0.1

2

0.1

3

Minimizes capital investment required

1

0.2

2

0.4

3

0.6

2

Recruitment and retention opportunies are maximized

3

0.6

2

0.4

2

0.4

3

Presents a scalable solution

3

0.15

2

0.1

2

0.1

2

Maximizes opportunity for 'campus of care' model

3

0.45

2

0.3

2

0.3

3

Mimizes ongoing financial (operational) subsidy

1

0.2

3

0.6

2

0.4

1

Weighted Score 0.3 0.15 0.4 0.6 0.1 0.45 0.2

15

1.9

16

2.35

16

2.35

16

2.2

Total

Option 1 Build New

Points

Weighted Score Points

Option 2 FSJ Clinic Own

Weighted Score

Option 4 Lease Other

Option 3 FSJ Clinic Lease

Points

Option 4 Lease Other

Minimizes monthly overhead for physicians

0.15

0.45

0.45

0.3

Quickly meets physician demand requirements

0.15

0.1

0.1

0.15

Minimizes capital investment required

0.2

0.4

0.6

0.4

Recruitment and retention opportunies are maximized

0.6

0.4

0.4

0.6

Presents a scalable solution

0.15

0.1

0.1

0.1

Maximizes opportunity for 'campus of care' model

0.45

0.3

0.3

0.45

Mimizes ongoing financial (operational) subsidy Total

0.2

0.6

0.4

0.2

1.9

2.35

2.35

2.2

•

Option 1 has the lowest absolute and weighted score

•

Options 2,3, and 4 have equal absolute scores, however Options 2 and 3 have higher weighted scores

32

Closing the Gap – Criteria Analysis Detail Strongly Meets Criteria Scale

Partially Meets Poorly Meets

Performance Criteria

Assessment Option 1Build New

Option 2 – Purchase FSJ

Option 3 – Lease FSJ

Option 4 – Lease Other

1. Minimizes monthly overhead for physicians

Poorly meets – Overhead $12,313

Strongly meets – Overhead $11,224

Strongly meets – Overhead $11,348

Partially meets – Overhead $11,934

2. Quickly meets physician demand requirement

Strongly meets – Capacity for 30+ physicians

Partially meets – Capacity for 21 physicians

Partially meets – Capacity for 21 physicians

Strongly meets – Capacity for 30+ physicians

3. Minimizes capital investment required

Poorly meets - $16M investment required

Partially meets - $6M investment required

Strongly meets $700,000 investment required

Partially meets - $3M investment required

4. Recruitment and retention opportunities maximized

Strongly meets – ‘Campus of Care’ model possible

Partially meets – Scaled down ‘Campus of Care’

Partially meets – Scaled down ‘Campus of Care’

Strongly meets – ‘Campus of Care’ model possible 33

Closing the Gap – Criteria Analysis Detail Strongly Meets Criteria Scale

Partially Meets Poorly Meets

Performance Criteria

Assessment Option 1Build New

Option 2 – Purchase FSJ

Option 3 – Lease FSJ

Option 4 – Lease Other

5. Presents a scalable solution

Strongly meets – Can be built as large as required

Partially meets – Can be scaled within space limitations

Partially meets – Can be scaled within space limitations

Partially meets – Limited by leasable space available

6. Maximizes opportunity for ‘Campus of Care’ model

Strongly meets – ‘Campus of Care’ model possible

Partially meets – Scaled down ‘Campus of Care’

Partially meets – Scaled down ‘Campus of Care’

Strongly meets – ‘Campus of Care’ model possible

7. Minimizes ongoing financial (operational) subsidy

Poorly meets – Results in highest physician overhead ($12,313)

Strongly meets – Results in lowest physician overhead ($11,224)

Partially meets – Results in second lowest physician overhead ($11,348)

Poorly meets – Results in high physician overhead ($11,934)

34

Closing the Gap – Other Vendors •

MNP consulted with private health service providers/vendors to gain a general understanding of the solutions they could provide

– – – –

Live Care IRIDIA MEDEO Ultima Medical

•

MNP did not undertake detailed analysis of any one provider/vendors solution as it was beyond the scope of this engagement

•

The Long Term Healthcare Solutions Partnership Committee may want to consider more detailed discussion with these or other providers/vendors to help alleviate the challenges being experienced with the physician shortage in Fort St. John

35

Conclusions – Operating Expenses Based on the principal findings of the study, MNP has drawn the following conclusions that we believe are consequential to the Long Term Healthcare Solutions Partnership Committee’s decision making process Operating Expense Analysis •

Overhead rates historically charged at both ABC and FSJ Family Practice clinics do not appear to be significantly higher than other clinics researched

•

FSJ Family Practice appears to have excess revenue collected from overheads that could be returned to physicians, effectively reducing monthly overhead to just under $10,000/month

•

ABC Clinic has successfully reduced monthly physician overhead to $10,000/month by reducing staffing levels and supplementing income with locum overhead revenue

•

Utilizing percentage based, or tiered percentage based methods to calculate overheads would result in higher overhead amounts for the majority of physicians practicing at both clinics (based on historical billing patterns), and significantly lower overhead amounts for a minority of physicians currently practicing at both clinics

•

Utilizing a percentage based, or tiered percentage based method to calculate overheads allocates more or less overhead based on the amount billed by each physician

•

Utilizing a percentage based, or tiered percentage based method to calculate overheads allows for physicians to “slow down” or “speed up” their practices with a corresponding adjustment to their overheads 36

Conclusions – Demand & Options Based on the principal findings of the study, MNP has drawn the following conclusions that we believe are consequential to the Long Term Healthcare Solutions Partnership Committee’s decision making process Demand Analysis •

There is an immediate projected need for at least 31 general practice physicians for Fort St. John

Option Analysis •

There are four baseline options for clinic space that can be considered 1.

2.

3.

4.

Build a new clinic(s) Purchase existing space (FSJ Family Clinic) Lease FSJ Family Clinic Lease other

•

Using the weighted criteria Option 1 has the lowest absolute and weighted score

•

Using the weighted criteria Options 2,3, and 4 have equal absolute scores

•

Using the weighted criteria Options 2 and 3 have the highest weighted scores

•

Capital investment required for the four options ranges from a low of $700,000 to a high of $16M 37

Conclusions – Options Based on the principal findings of the study, MNP has drawn the following conclusions that we believe are consequential to the Long Term Healthcare Solutions Partnership Committee’s decision making process Option Analysis (cont’d) •

Initial capitalization required for the four options ranges from a low of $700,000 to a high of $16M

•

All four options require additional and ongoing subsidization of physician overheads should a meaningful reduction in physician overhead be desired/required –

Option 2 requires the lowest subsidy, followed by Option 3. 4 and 1

General •

There will be significant third party subsidization required to decrease physician overhead

•

There will be significant third party capital investment required to develop a ‘Campus of Care’ concept in Fort St. John

•

Philanthropy in the form of non-repayable equity, and/or annual subsidization is required to make any of the four options financially feasible

38

Project Drivers Reminder •

How to attract, recruit and retain family practitioner's?

Solutions Committee’s Role

–

Solution needs to address short and medium term need, but must also be sustainable in the long term

–

Requires valid and credible data upon which to base decisions

–

Solution needs to be developed collaboratively with all stakeholders:

MNP’s Role

• Northern Health • BC Ministry of Health • City of Fort St. John

Negotiation

• Physicians • Industry • Industry Associations (Doctors of BC) • etc….

39

Next Step Considerations 1.

Determine the appetite for and feasibility of, the options presented based on the requirements presented for each option

–

Each potential collaborator (BC Ministry of Health, Northern Health, City of Fort St. John, FSJ and ABC Clinic physicians, and industry)

2.

Negotiate a chosen solution

3.

Specify the details of the solution –

Capital investment?

–

Operating investment?

–

1x investment?

–

Ongoing investment?

–

Governance of solution • Not-for-profit corporation?

• Sole ownership?

–

Other?

40

Greg Lamothe, CMC National Director, Health Consulting office - 204.788.6095 cellular - 204.470.6152 e-mail - greg.lamothe@mnp.ca

41