Issuu on Google+

Submitted By: Jose Marti Alunan Miguel Aurelio Mariel Flores Gabriel Garcia Pamela See Charlene Tiu February 15, 20010


I .Industry Overview

Page | 2


A. General Description of the Industry The health care industry, which includes the delivery of various health services --diagnosis, treatment of diseases, and maintenance of health, by health care providers or professionals, is one of the stable services in the Philippines. In fact, the total health expenditure has growth rates of at least 4.7%1 in 2003-2005 and at the same time the health expenditure has a stable share of 3.1% in the gross national product (GNP) from 2003-2005 2. The health care service is deemed as a necessity by the government for the good of the people.

The health care industry has a wide scope of sub-industries from the production of over the counter drugs and equipments to selling health insurances. The health care sub-industry that HealthLink would enter would be the health care service of clinics and hospitals specializing in the most prominent needs of the community where it is situated. A survey will be conducted per area of expansion to prepare a focus to the services that unit of HealthLink would provide, for example, San Jose, Rodriguez, Rizal branch would focus on pulmonary conditions. Barangay San Jose has a 2009 expected population of 93,567 people with a national rate of 0.5% 3 of the total population having pulmonary diseases.

The common practice of providing health care in the Philippines is usually done through physical or face-to-face consultations, wherein the health care provider or physician diagnoses the patient’s symptoms and applies his/her medical knowledge to appropriately address the condition. This system works well if the healthcare provider or physician is knowledgeable and 1

2008 Philippine Statistical Yearbook. Manila. National Statistical Coordination Board, page 9-31 ibid 3 Department of Health, 2007 Annual Report 2

Page | 3


has sufficient experience with regards to the medical field. For urban dwellers who live in Metro Manila, there would not be much of a problem as there are a handful of private (127) and government (42) hospitals to choose from, totaling to a 169 4 hospitals in the capital city. But from a national perspective, with a total population of 97,976,603 5 in 2009, the medical service is spread thinly and social class starts to divide especially in provinces and less industrialized places.

With a recorded 26,116 public health practitioners in 2006 6, the demand for this service exceeds the capacity currently provided. 69% of public and private hospitals in the Philippines only provide minor or routine check-ups and do not fully maximize their resources7. Screening is supposed to be done by Rural Health Units but the people are dissatisfied with their services according to surveys and market researches. To address this particular need, health service providers are looking for better ways and alternatives to serve more people efficiently; such solutions involves the usage of telecommunications technologies like, emailing, text messaging (SMS and MMS) and video conferencing. The trend of injecting technology into time-tested practices has better chances to make the diagnosis process faster while reducing human error.

One of the emerging trends that corporations and other entrepreneurs are currently looking into is telehealth, otherwise known as telemedicine. Telemedicine is defined as “the use of medical information exchange from one site to another via electronic communications for 4

2008 Philippine Statistical Yearbook. Manila. National Statistical Coordination Board, page 9-27 "Philippines Demographics Profile 2009." Index Mundi - Country Facts. N.p., n.d. Web. 13 Dec. 2009. <http://www.indexmundi.com/philippines/demographics_profile.html>. 6 2008 Philippine Statistical Yearbook. Manila. National Statistical Coordination Board, page 9-21 5

7

"Overview of the Philippine Health System 2007 Veterans." COMSTE - Philippines' Congressional Commission on Science and Technology and Engineering. N.p., n.d. Web. 13 Dec. 2009. <http://www.comste.gov.ph/content.asp?code=277&desc=downloads>.

Page | 4


the health and education of the patient or health care provider and for the purpose of improving patient care.” 8 Telemedicine has three general types of devices: data storage and retrieval systems, diagnostic imaging systems, and therapeutic systems.9 Telemedicine includes services --- consultative, diagnostic, and treatment of illnesses, that are within reach all at the same place. Access to health care services through telemedicine will enable patients to have more access for their medical needs. It is specifically targeted to patients who live in the rural or remote areas, where hospitals or local government clinics are situated in main towns or bayans which are not fully accessible especially to those who live in the outskirts because of lack of transportation.

Internationally, Telehealth is described as “the use of a digital network to monitor and/or treat patients in a different physical location than the medical expert.” 10Telemedicine in the Philippines is already being practiced in some limited areas of the country through the National Telehealth Centre since 2005 by a partnership between UP Manila and Philippine Government Hospital (PGH). Its first operation were in the villages of Cagayan, Leyte, Capiz, and Lanao Del Norte 11. They have provided these remote villages an equipment (laptop) for their health communications. The industry is projected to have a growth rate of 56% at a 5-year annual compound targeting existing consumers such as patients with chronic pulmonary and

8

"Definition of Telemedicine." Med Terms. 26 06 2006. Web. 13 Dec 2009. <http://www.medterms.com/script/main/art.asp?articlekey=33620>. 9 "COMSTE.gov.ph - Downloads." COMSTE - Philippines' Congressional Commission on Science and Technology and Engineering. N.p., n.d. Web. 13 Dec. 2009. <http://www.comste.gov.ph/content.asp?code=277&desc=downloads>. 10 MarketWatch: Global Round-up; Dec2008, Vol. 7 Issue 12, p227-228, 2p, Datamonitor, accessed through: Business Source Complete 11 "'Telemedicine' means doctor is always in - INQUIRER.net, Philippine News for Filipinos." News - INQUIRER.net. N.p., n.d. Web. 13 Dec. 2009. <http://newsinfo.inquirer.net/breakingnews/infotech/view/20081109-171195/Telemedicine-means-doctor-is-always-in>.

Page | 5


heart diseases and to emerging markets such as long-distance patients seeking medical attention through online. 12

Datamonitor proclaims that despite the reluctance of most risk-averse professionals who practice traditional medical diagnosis through physical conduction, telehealth seems promising with the premise that that there is a more convenient information exhange between doctor-to-doctor or to doctor-to-patients which allows for a rough assessment of the situation before anything else. Telehealth covers a range of possible new services, products and subindustries to proliferate and eventually penetrate the market in the coming years, among which is speech technology, thermal imaging, ultrasound and the like.

Another trend in the health services industry that Google and Microsoft are currently experimenting on would be the Intel Health Guide Product. It is similar to telehealth in concept, but uses specific technology and interface to its service such as health education content, video conferencing, calendar and other reminder functions. 13

HealthLink aims to provide medical screening for the most prominent illnesses in the community by making use of technological advancements in detecting complications in the human body. The concept revolves around speed, efficiency and the digitalization of records which lesses the use of paper and easier way to transfer and store. By using the telehealth concept, HealthLink clinic can reach more people too without them having to go through the 12 13

Ibid. MarketWatch: Global Round-up; Dec2008, Vol. 7 Issue 12, p227-228, 2p, Datamonitor, accessed through: Business Source Complete

Page | 6


hassles of commuting from one area to another. There would be treatment for the most common illnesses in the community while all the other conditions that are not within the scope of services provided by HealthLink would be referred to the most appropriate healthcare institution, while all relevant data will be transferred electronically. HealthLink would be a convenient first stop for anybody feeling discomfort and symptoms and are not sure of how to go about treating it.

Because of the many prospects technology presents for health care, there is a need to regulate it. There are multiple agencies given this task namely Bureau of Food and Drug, Bureau of Health Facilities and Services, Bureau of Quarantine and especially for this project the Bureau of Health Devices and Technology (BHTD). The BHTD is composed of physicists, engineers and lawyers who regulate the use of thousands of devices for health care as they hold great risk to human life if misused. 14 They generally manage devices that fall into three categories which are data storage and retrieval systems, diagnostic imaging systems and therapeutic systems.

For feasibility, this project is a modified version of the currently established UP Manila National Telehealth Center (NTC). It was established in 1998 to improve health care delivery to the general public through ideas and knowledge exchange utilizing information technology.15 They have systems to handle electronic health records (CHITS), eLearning and eMedicine (also known as telemedicine). They also make use of technological devices like the RxBOX for

14

"COMSTE.gov.ph - Downloads." COMSTE - Philippines' Congressional Commission on Science and Technology and Engineering. N.p., n.d. Web. 13 Dec. 2009. <http://www.comste.gov.ph/content.asp?code=277&desc=downloads>. 15 "Welcome to the UP Manila - National Telehealth Center â&#x20AC;&#x201D; UPM-NThC." Zope QuickStart. N.p., n.d. Web. 13 Dec. 2009. <http://plone.telehealth.ph:8081/NTHC

Page | 7


medication, TRIAGE for coordination and EXPERT for poisons.16 HealthLink could address the issues already faced by this organization and innovate on their efforts.

The concept of HealthLink is to be a more accessible alternative to hospital care and it positions itself as the more convenient choice for initial diagnosis of symptoms and discomforts for the lower income bracket through the incorporation of current technological innovations in the field of medicine. . This position already implies that HealthLink would be competing against hospitals, medical laboratories and other general clinics that offer basic services for their number of patients. Conversely, HealthLink would also work with these said firms to improve the flow of information among them thus improving the community further.

The health care industry has already been well established and it has existing infrastructures that precede HealthLink. Some of the competitors faced by HealthLink, specifically in San Jose, Rodriguez, Rizal are the following: a) H Vill Hospital – a private-owned hospital that offers complete services for a high price b) Kasiglahan Infirmary – public clinic that offers basic services and consultation for free, consisting of 1 doctor and 13 nurses c) Health Expert – a medical clinic that offers various laboratory tests such as clinical microscopy, urinalysis, fecalysis, hepatitis, etc.

16 E-Health Initiatives, "COMSTE.gov.ph - Downloads." COMSTE - Philippines' Congressional Commission on Science and Technology and Engineering. N.p., n.d. Web. 13 Dec. 2009. <http://www.comste.gov.ph/content.asp?code=277&desc=downloads>.

Page | 8


An indirect competitor of HealthLink would be self-medication of generic medicines, where consumers can readily avail of in drugstores even without a doctorâ&#x20AC;&#x2122;s prescription. Symptoms are sometimes seen as the sickness itself and the instantaneous response would be to address these by taking medicines immediately in hopes of decreasing further complications that would require expensive medical check-ups or operations later on. There is a possibility that people would take advantage of these medicines, misusing them even they donâ&#x20AC;&#x2122;t need them; which can further damage their health instead of getting better. 17 There are also those people who choose to ignore or deal with the symptoms until they can but this would just end up complicating things more which would entail more expensive medical expenses later on.

HealthLink aims to establish itself in areas that are far from hospitals, up to the areas where technology barely penetrates. HealthLink would be a prominent figure to the locals of a community in feeling better and improve the technological awareness of the community. With the use of databases, HealthLink will also be able to keep track of the status the community for further initiatives to improve it.

In running the business, HealthLink will be using two desktop computers and one laptop computer. The desktops will be used by the nurse and the medical technician. The laptop will be used by the doctor. There will be computer-based hardware for x-ray imaging in order to do in-depth diagnosis focusing in respiratory illnesses. The computers will have internet capability via DSL or broadband, and be linked via modem/network. The software to be used will also be 17 "RxPinoy Medication Guide." RxPinoy: Find Doctors and Dentists in the Philippines. N.p., n.d. Web. 13 Dec. 2009. <http://www.rxpinoy.com/medguide/>.

Page | 9


Dev C or Dev C ++, which is a program data analysis, and Java, for computer- user interface.

The effect of recent national calamities and inflation in prices would lead families to have limited disposable income thus consumers would avoid luxurious goods and would rather avail of goods and services that are only a necessity, including health. 18 HealthLink would ride on this trend where people with less financial resources can still afford medical service for a fraction of the cost of a fully equipped hospital while keeping faster turnover for the convenience of the patients who do not have time to have a checkup because of the need to work and not miss a day's paycheck.

The Medical Act of 1959, section 10 “Acts constituting practice of medicine. A person shall be considered as engaged in the practice of medicine (a) who shall, for compensation, fee, salary or reward in any form, paid to him directly or through another, or even without the same, physical examine any person, and diagnose, treat, operate or prescribe any remedy for any human disease, injury, deformity, physical, mental or physical condition or any ailment, real or imaginary, regardless of the nature of the remedy or treatment administered, prescribed or recommended;… 19.”does not restrain the Telemedicine industry’s services in the Philippines since our government supports the National Telehealth Center, allocating a budget amounting to $2 billion for the development of this service. Although the government gives support, the challenge that this industry faces is the conservative belief of the general public including

18

Euromonitor international, 2009 "REPUBLIC ACT No. 2382: THE MEDICAL ACT OF 1959." Law Phil. 06 20 1959. Web. 13 Dec 2009. <http://www.lawphil.net/statutes/repacts/ra1959/ra_2382_1959.html>

19

Page | 10


doctors and other health practitioners that health advice should only be done in actuality or physically.

The government passes bills like RA9502: Universally Accessible Cheaper and Quality Medicines Act of 2008 which set the conditions for a more socially-oriented medical service.20 The government also supports retaining health specialists in the country so that they can serve their own countrymen as well as provide more economical services and drugs for the masses, as to avoid brain drain. 21

B. The Business Vision We, at HealthLink, envision being the benchmark for social entrepreneurship and technological appropriation in health care for poor communities nationwide.

Mission We, at HealthLink, will enable patients to live life with ease, productivity and peace of mind through our specialist clinics with laboratories in poor communities in the Philippines. Our use of telemedicine technology will provide a more accurate, appropriate and affordable diagnosis. We will generate profit while being driven by a customer-centric frame of mind. People will come to us because we value the community, innovation and service excellence. We conduct

20

"R.A. 9502." Philippine Laws and Jurisprudence Databank - The Lawphil Project. N.p., n.d. Web. 13 Dec. 2009. <http://www.lawphil.net/statutes/repacts/ra2008/ra_9502_2008.html> 21 Euromonitor international, 2009

Page | 11


business with integrity for every patient we serve. We provide a working environment where employees are passionate and continuously grow as professionals and persons.

HealthLink will be the first concrete eClinic in the Philippines. In a nutshell, an eClinic is a regular clinic that has basic medical tools and services, but employs telemedicine equipment which uses recent information technologies such as the internet or software technologies. HealthLink will be a socially-oriented for-profit organization that provides health services to people falling into the bottom part of the social pyramid through the use of integrated telecommunications. Its first initiative is the E-Clinic which employs a more technological approach compared to regular clinics.

HealthLink aims to promote a more active community participation In terms of promoting and maintaining health and wellness of the members in the community. The clinic will be centering its attention to the community and will make efforts to get closer to them. Consequently, HealthLink will be able to gain more information and knowledge about the the community and be able to addess their needs effectively and efficiently. It will also seek the support of the government through tax exemptions and/or volunteer works. In exchange for the local business tax exemption, HealthLink can offer the government, in return, its services especially to indigent patients who do not have any capacity at all to pay for medical services. Public health care establishments can refer these kinds of patinets to HealthLink who will be able to provide them appropriate medical attention. In the case of government-owned Kasiglahan Infirmary, which lacks the fund to improve on its facilities and medical equipments, Page | 12


patients are not able to be treated properly. Medical services should be one of the obligations of the governemnt to its people but the government is currently doing an insufficient job with it. The money which HealthLink can save up from the tax exemption can instead be approportioned to servicing those who really canâ&#x20AC;&#x2122;t afford medical services. That way, HealthLink is able to save money in order to save more lives.

HealthLink makes it financially possible for the D and E market in urban poor areas to gain accessibility in consulting with specialist doctors and undergoing laboratory tests. HealthLink will be using the latest telemedicine equipment for faster and more cost-efficient acquisition of results, such as a low-cost plug-in X-ray device for laptops. It will also be using an electronic patient database that can facilitate a more effective way of storing, reviewing and sharing of relevant medical records.

The HealthLink e-clinic will obtain income from its end-users through nominal consultation fees for walk-in patients or an insurance scheme for members. The insurance scheme works by providing potential members the option of paying affordable fees through monthly installments, or by paying 1 year worth of services in whole for the cardholder.

In return, members can get free and unlimited consultations, discounts and other services that would generate customer loyalty and a steady influx of income every month. Positioning will also be one of the companyâ&#x20AC;&#x2122;s assets, as it taps areas that lack medical facilities.

Page | 13


In essence, the business will target quantity and frequency of patient patronage, and will steadily promote the insurance scheme to help sustain the affordability of its services.

More than medical technicalities, HealthLink sells quality life. It aims to bring families closer to their aspirations by keeping them safe from life-threatening illnesses and maintaining healthy bodies. By addressing the physical well-being of customers, the business is able to provide productivity and peace of mind. Overall, HealthCheck’s E-Clinic service is an effort to utilize telecommunications technology in the medical field such that it provides a solution to one of the country’s main societal concerns – that is, health care for all.

C. The Product The main product of HealthLink’s services will be the integrated software package for telemedicine activation and shared access of database information via the internet. To illustrate the feasibility of the product, the integrated package is similar to that of Adobe Suite. Adobe Suite consists of many application programs such as PhotoShop, InDesign, Premiere and Flash, which are integrated into a software package that the end-user can use in one installment. In comparison to HealthLink, the company’s unique software package will include application programs for the plug-in X-ray, as well as, an application for the web-based medical information database. The strategic concept of having a software package allows expansion in terms of the application programs that can be included into it. As an example, ultrasound, with its digital imaging capabilities can be included in the package in the future. In the same way as Adobe

Page | 14


Suite expanded with having DreamWeaver, Illustrator, Encore and Fireworks. This will allow possible expansion of the business and tap new markets such as pregnant women.

HealthLinkâ&#x20AC;&#x2122;s services will primarily consists of general consultations by a general physician for basic illnesses, laboratory tests such as hematology, clinical microscopy, urinalysis, fecalysis, hepatitis tests, blood chemistry [consist of white blood plate count and complete blood chemistry], enzymes, electrolytes, thyroid tests, serology, tumor markers, hormones, drug test, HIV, and limited bacteriology tests. However, HealthLinkâ&#x20AC;&#x2122;s unique service separating it from its competitors will be an X-ray device that can be plugged-in to any laptop. This will allow for detection of respiratory problems, specifically, Tuberculosis, Pneumonia and Bronchitis. It also has an integrated patient database to store in historical data and other related information regarding check-ups.

Fig.1: Sample X-ray Image

Fig.2: Sample Digital Imaging

Fig.3: Mobile

To illustrate the requirements and feasibility of X-ray technology, the product can be divided into three main components. First is the hardware, the output that scans the lungs of the patient from the exterior. Second is the software that analyzes the data received from the Page | 15


hardware. The last is the monitor that displays the input of the software, allowing the end-users to view the results. The product also uses digital imaging technology that eliminates radiation present in regular X-rays, which is known to be harmful to humans 22, and instead uses electrical impedance tomography which basically uses the flow of electric currents as a measurement.

Science Daily, the resource of this product innovation, as well as, an interview with Ms. Arsol Reyes of the Ateneo ECE department, proclaim that it is a feasible technological trend that can replace regular, costly and bulky X-rays and can be marketed to depressed areas that lack access to complicated health equipment and services and the space needed to house these big machines. 23 In addition, the patient database, which is included in the software suite that the company will be developing, will mainly be used to record the pateientâ&#x20AC;&#x2122;s information such as medical history, clinic transactions and lab results. The digital records will make it easier for storing and sharing of files to authorized doctors. Overall, the productâ&#x20AC;&#x2122;s unique feature will be its cost efficiency, because all the components are simplified and the output can be displayed on the screen of the laptop. Below is detailed list of technological equipments needed to run HealthLinkâ&#x20AC;&#x2122;s services.

22 23

http://www.sciencedaily.com/releases/2008/04/080429204303.htm Ibid.

Page | 16


1. Hardware

1 computer

This will hold the patientsâ&#x20AC;&#x2122; database and administrative files and will be operated by the nurse in the receiving area. 2 laptops (Minimum One laptop will be used by the doctor to input data from specifications: Dual-Core 2.2 GHz the patient in the consultation area. The other will be used processor, 120Gb Hard drive, 2 by the medical technician for the actual X-ray and to input Gigabyte Ram and a good video other medical data. card) X-ray output The hardware that will scan the lungs of the patient. Modem This will allow Internet connectivity. Router This will allow a Local Area Network within the clinic. Broadband Connectivity (a This is to ensure fast and smooth communication via minimum of 2 MB per second) Internet. Printer This will be used to print any important documents. Telefax This will be used to fax important medical documents. Basic Laboratory Equipment Used for testing hematology, clinical microscopy, among others. Table1: Hardware components 2. Software Windows XP or Vista Microsoft Office Dev C or Dev C++ Programming Software Java Software Sun Microsystems

The basic computer operating system. This will be used for administrative purposes. This will create a program that will analyze the data from the X-ray output hardware. The software program that will create the graphic user interface (GUI). Web-based centralized database This allows the nurse, the doctor and the medical (WBCD) technician to actively share medical information between each other. Such information will also be made available to the nearest hospital when a patient is referred. This will be somewhat like Google Docs. Table 2: Software Components

Page | 17


3. Product Design The product design of HealthLink is presented through the house of quality. It shows the relationship of the customer needs and the value that HealthLink offers. It also shows how competitors address the demands of the market. See appendix A for the house of quality diagram.

4. Service Blueprint

Page | 18


Fig. 4: Service Blueprint

Page | 19


D. Entry and Growth Strategy HealthLink clinic initially intends to launch its services in Barangay San Jose in Rodriguez, Rizal because there is a foreseen need for a better health facility and service in the area. The first half of the year upon launch will be spent to actively market the clinic within the area. Health services will primarily focus on pre-screening respiratory problems such as pneumonia, bronchitis and tuberculosis since these are among the most prevalent diseases in the area. The clinic will also be having a medical laboratory. HealthLink will also carry a portable x-ray imaging device that will be connected to a laptop that will serve as the monitor and wherein the necessary softwares will be installed. The problem is that no x-ray equipment is available in the clinics because of lack of space so HealthLink will be acquiring a portable one. The other half of the year will be spent concentrating on observing the current system and planning ways on how to make the operation and logistic process more efficient if necessary.

For the second year, HealthLink will carryout the same operations as it did on the first year with the primary goal of improving the delivery of its services and recovering its initial investment. It will just continue improving its existing portfolio of services, build up on its brand image through promotional means and gaining more number of clients.

In the third year of operation, HealthLink will be expanding its clinic in Barangay San Juan, Taytay, Rizal, another heavily populated barangay with a rough estimation of 88,000 and has the same health conditions as Barangay San Jose. Expansion to the said area is also seen to be appropriate for it would be convenient for the company to have its first expansion also Page | 20


within Rizal in Region IVa. HealthLink will also start compiling information from the database as a medical research for Rizal province because HealthLink will be having future plans of initiating studies regarding the medical industry regionally in order to help contribute statistics and some relevant health information that might be of great help for the Philippineâ&#x20AC;&#x2122;s medical industry. HealthLink will also be putting up its headquarter office in Visayas Avenue, Tandang Sora in Quezon City.

Currently, the Philippines health program is largely in need of further improvement. This Currently, the Philippines health program is largely in need of further improvement. This creates an opportunity for HealthLink to support and promote health consciousness and implement basic health practices to communities that have only limited access to health services. Moreover, what makes the clinic specifically different is that it will employ the use of telemedicine equipments as a way to provide the necessary medical services that are appropriate to the local setting. Space will not be a problem anymore because of the portability of these equipments that are not only cheaper but also promises the same quality results.

These days, corporate social responsibility has also been gaining much recognition and support from companies as they integrate it into their business practices. A lot of these institutions are becoming active in participating in social services as they begin to become aware in the importance of taking responsibility to help others and giving back to society. There have been many foundations that aims to help the marginalized through the many projects they offer, which are being carried out by a lot of sponsors and volunteers. In line with this, the Page | 21


HealthLink clinic will be implemented to serve its part in providing health services especially to those who have limited access to it.

E-clinicâ&#x20AC;&#x2122;s strategic integration of telecommunications to its basic and specialized medical services into a sustainable business model presents itself as a formidable option for those that are financially challenged. This provides the marginalized a chance to access higher quality health services that is equally affordable and convenient for them, reducing errors in personal treatment or even malpractice of some questionable doctors. With the extensive knowledge of the E-clinicâ&#x20AC;&#x2122;s medical specialists and nurses, the risk of putting health in jeopardy is minimized and at the same time, it is able to provide more security and assurance to the lower class who often resort to cheaper alternatives regardless of the quality of the service they pay for.

E-clinic; therefore, seeks itself to be the frontier in delivering affordable and quality health services to the marginalized in response to social inequality and malpractice. Armed with reliable medical facilities, the possibilities of telemedicine, and strategic identification of the need of the market, E-clinic is expected to reach new heights in the health care industry employing opportunities for active community participation, corporate social responsibility, utilization of the countryâ&#x20AC;&#x2122;s surplus of nurses, medical and educational practice, and most importantly, equal access of health services for everyone.

Page | 22


II. Market Research

Page | 23


A. Industry SWOT STRENGHTS • •

• •

WEAKNESS

Offering the service at a low price will make it easier for the community to accept the service. The technology that is applied gives HealthLink an image of superiority over other firms that rely less on technology. The small structure would make it easier to monitor the employees. The specialization will garner loyalty from people wiho are suffering from respiratory illnesses The technology used for one test could apply to confirm the existence or absence of a complication for an entirely different disease. OPPOTUNITIES

Scientists, doctors and engineers are putting much effort into revolutionizing the medical industry not only through researches and experiments but also in the technological aspect. One of the trends that are changing the way of doctor and patient interaction is telemedicine and medical imaging. Also portability in using the technologies. The private sector, despite being seen as catering mostly to the upper market, is actually playing a major role than the public sector in financing and provisioning for health care. The poor are brand-conscious,

• • •

Serving on a quantity basis might slow down the operations if not managed well. Reliance on technology might make the firm useless if electricity is cut or if the server encounters a problem. The low revenue margin might backfire if volume is too low. HealthLink can only refer the patients that have a condition out of scope. Maintenance of the equipment becomes difficult if it is going to be used repeatedly for the quantity of patient.

THREATS

Most patients prefer to visit doctors or establishments that they have already tried and are satisfied with already. Poor transport and communication system limits the people's accessibility and utilization of resources. Most of the existing health services in provincial areas have outdated or insufficient basic medical equipments. People do not have enough money to pay the required medical fees so they resolve to medicate themselves with generic drugs or they wait to the best they can to tolerate whatever discomfort they are Page | 24


receptive of technology, and extremely value-conscious by necessity. Just like anyone else, these people have big dreams for a new and different quality life and they expect to get more value out of the prices that they could afford to pay.

feeling.

Table3: SWOT Analysis

B. Market Size and Trends HealthLink would situate in the Rizal province of region IV-A (CALABARZON), specifically in the municipality of Rodriguez (formerly Montalban). For the start-up of HealthLink, the location of interest would have an estimate population of around 1,650,075 24 according to the DOH; specifically the barangay of San Jose which had a 93,567 recorded population as of Aug 1, 2007 according to the NSCB. 25 Inflating the population by its 2007 recorded growth rate of 9.58%, the likely population of San Jose would now be around 112,353. This is prime location for the services offered by HealthLink as it has the highest population of the 11 barangays of Rizal taking 64.46% of the total population of Rizal which would work well with the business model of HealthLink that would rely heavily on quantity of patients.

San Jose is also considered urbanized which would make it easier to penetrate the community with technology-based products and equipment. From observation, there is a good presence of the local government units in that area because of the multiple public facilities available, some of which are public clinics/infirmaries. According to the survey conducted by

24 25

Department of Health, 2007 Annual Report http://www.nscb.gov.ph/activestats/psgc/municipality.asp?muncode=045808000&regcode=04&provcode=58

Page | 25


the group however, the services offered by the public clinics are lacking; an opportunity to provide better services arises as the people voice discontentment. Despite being an urban location, more than half of the total barangay population belongs to the poor, specifically people relocated of this area who live in areas of the housing projects.

2007 Rizal population

1,650,075

2007 San Jose population

93,567

2007 growth rate

9.58%

2009 estimated population

112,353

Table 4: Summary of San Jose, Rodriguez Population Statistics

HealthLink would cater to the specific need of the community that it serves. For the general area of CALABARZON, DOH has surveyed that the following are the most common diseases:

Table 5: Region IV-A Top Diseases

Page | 26


This table helps generalize the region, but as HealthLink would focus more in the general San Jose area with special attention to the needs of the more rural areas, a survey was conducted to pin-point the most common local diseases. This survey revealed that even though diarrhea was present, it was not considered as a significant enough threat in this particular community. They mentioned that pulmonary diseases are the most prominent, with Tuberculosis as the biggest problem. In addition to this, the â&#x20AC;&#x153;pain rating scaleâ&#x20AC;? portion of the survey revealed that the people are very much wary of colds, clogged noses and dizziness; they are more likely to consult early if they are experiencing these symptoms.

With this information, HealthLink will have a market segment for people who would be bothered by these relevant symptoms and would find the need to consult for proper health care. If in the event that a pulmonary disease is present in the patients, HealthLink would also serve as a station for further care to help prevent complications that would come from late treatment.

One major factor to be considered for the success of HealthLink in the community would be the competition. Based on the surveys, many people are very enduring yes willing to spend for health. Few of the respondents do see symptoms as disease and thus not worth consulting for. In the event the treatment would not be free the people tend to endure up to the point of tears in the pain rating scale; but surprisingly enough even with low margins, they are willing to spend a significant amount for their health. The poorest people (decile 1) are still willing to spend about 5% of their limited budget for their health while the richest (decile 10) Page | 27


spend only about 2.4% of their income. 26 With this burden of spending, people trying to save find a reliable health care provider and stay loyal because it would be too financially problematic to go to multiple places. HealthLink can make use of this through proper marketing of reliability and being a more economic choice than the old system of one time spending when the condition becomes unbearable already.

Another factor that will greatly affect the performance of HealthLink in the community would be the quality of service. Many of the people there are conditioned to accept the public clinic provided for them for it is free and accessible, but they are very much dissatisfied with the quality of service provided to them. There are issues of unreasonable queuing, limited resources and expertise and even relevance of the recommendation which often leads the people to other firms, thus delaying the process. HealthLink could make use of these weaknesses of the competitor and make it an opportunity to be realized. HealthLink would serve the same purpose of being near the community as the people are willing to walk for even 30min if for medical reasons. HealthLink could reduce queuing by having faster turnovers because of efficient equipment, a more complete set of diagnostic equipment at a cost that is very much within reason.

With all the refinement of operations that caters to the needs of the community, it is reasonable to expect very low following during HealthLinkâ&#x20AC;&#x2122;s first year because it offers roughly the same service that public clinics somewhat offer for free. The growth would rely on

26

Philippine Income and Expenditure

Page | 28


consumer trust in the brand, because it would surely benefit the people to spend small for a diagnosis to avoid going to a large hospital that would charge much more. Starting from a humble market entry in its first semester of at least 3% of the whole population, which is the totality of the population known to have pulmonary complications for the first year; HealthLink would care for the market that prioritizes pulmonary conditions. Rate of increase in market share peaks at the second semester due to the maximization of promotional efforts, resulting to a 5% market share at year end of entry. The rate of increase is then expected to slowly flatten although growth in market share will still be consistent, reaffirming the need to expand to another location by year three. The tables below reflect these trends.

Fig.5: Market Share Increase

Page | 29


Needs -Pulmonary health care -Diagnosis of symptoms -Affordability -Fast queuing -Reliability of diagnosis -Close to community

Segment -People looking to consult a medical expert for their symptoms and detect any serious diseases early, for an affordable price.

HealthLink -Makes use of advanced technology to be more efficient in diagnosing and providing pulmonary health care while keeping prices affordable; helping prevent the development of serious complications.

Trends -Use of technology -Cost reduction -Shorter waiting and processing times -Early detection -Digital transfer of data -Self-medication -Having multiple children

Table6: Summary of market needs and trends

C. Target Market 1. Geographic HealthLink would serve as a low-margin, high-turnover firm that would rely more on the quantity of people served rather than the revenue generated from individual patients. A prime location where this service would fit well would be a high density area with several urban poor; the group sees the Rizal province of Region IV-A to fit this profile. The routes in this area make it somewhat hard to reach which raises their requirements for services like health care. The nearness to Payatas dumpsite also makes the environment ripe for diseases further increasing the need for local health care services to be available and affordable.

Page | 30


2. Demographic There is no age requirement for acquiring medical services, but HealthLink would focus its marketing efforts toward attracting adults who are of the right age to have a family and/or have stable work. The main reason behind this is that they are expected to be the ones handling the householdâ&#x20AC;&#x2122;s budget and would be the one to allocate funds to be used for health care.

The socioeconomic market segmentation that HealthLink would implement would be prioritization of the D and E income bracket. The service that HealthLink would provide would be costed with a low profit margin so as to accommodate the tight budget of the urban poor. It is unlikely that the C and above market would see much value in the service because it is more likely that they have their own family-trusted doctors to go to when complications arise.

3. Psychographics The market segment of HealthLink appeals to the thrifty people that want to live a safe lifestyle. Because the primary service of HealthLink is early detection, it is along the lines of prevention. A person might think that going to HealthLink would be a better first stop because it is well equipped and would not cost so much, as compared to waiting for a disease to subside which could make it worsen and later cost more to cure.

As a technology-driven firm, HealthLink will appeal to people who greatly value the use of technology (as the area is somewhat already urbanized). A person who is likely to avail of the Page | 31


service of HealthLink would be someone open enough the experience of advanced technology and willing to accept the functionality of technology in the community.

4. Behavioural HealthLink would appeal to people who desire a cheaper alternative to having a doctorâ&#x20AC;&#x2122;s consultation in a hospital or private clinic, which is heavy on the budget. They might also be looking for the highest value that their scarce money would get them. Once we establish a good connection with this aspect of the market segment we could gain brand loyalty which would greatly benefit the future growth of HealthLink.

5. Sample Consumer Profile: a. Aling Bebang Aling Bebang is a fulltime housewife of 29 years old with 4 children. Her husband is a full-time parking attendant who brings home P7,000 a month. She is a mother who loves spending time with her neighbor and kids. She tries to save as much money as possible only spending for the necessities.

Fig.6: Aling Bebang

She has experienced enough to know what over-the-counter drugs she would need for basic symptoms and she tries to minimize her visits to the public infirmary because Page | 32


the line queue would take up too much of her time.She usually either ignores symptoms or self-medicates depending on the degree of intensity the symptom is. She would usually avoid seeking help until the point of tears, and even when she reaches her limit, she

would

only

go

to

the

free

public

clinic

to

save

money.

Aling Bebang would like to go to good clinics to have consultations, treatment and diagnosis for her family and herself but does not have money for it as its consultation and treatment with good clinics are expensive.

She is wary for her children. With a fear of pneumonia for her children, she gets her children checked out at the local pulmonary-specialized clinic that could also diagnose her child for many other possible sicknesses. After the first experience of the efficient service of HealthLink, she might decide to visit again every time symptoms present themselves. She doesnâ&#x20AC;&#x2122;t even have to have pulmonary conditions in mind before consulting because if her child is diagnosed with a different disease she can be referred to a different firm with the proper skills to handle them.

b. Mang Edgar Mang Edgar is a 35 year old man. He is a Jeep driver and a part time steel wielder who repairs Jeeps during his free time. He earns roughly around P12000 per month. He has a wife, and 2 kids aged 5 and 7. Edgar likes to drink with his neighborhood friends and taking his family Fig.7: Mang Edgar Page | 33


around town. Mang Edgarâ&#x20AC;&#x2122;s first concern is the health of his family. As the head of the family, he works hard in order to be able to provide food for his family and pay for the needs of the family such as water and electricity and education for his children.He tries to keep his family happy and safe by providing their needs. He tries to keep his family healthy as to avoid unnecessary expensive expenditures. Whenever his family feels ill, he buys the necessary generic medicines in order to help them get better. He avoids bringing his family to the hospital as it would be expensive, and very inconvenient for them to go to. He does not like the clinics in his town because more often than not the clinics are dirty inefficient and rarely have doctors available. c. Ate Jenifer Ate Jenifer is a mother of one at a young age of 18. She lives with her parents and sells fried chicken in order to help earn money. She earns roughly around P3500 a month. Her child is 1 year old. Ate Jenifer being so young was only able to finish 2nd year of high school. Fig.8: Ate Jenifer

Living with her parents, she is able to ask them for financial aid whenever the need arises, but she tries not to because she would like to be able to take care of herself as her child on her own.

Page | 34


She does not like going to the hospital and clinics as they are very inconvenient in terms of location and expenses. Whenever ate Jenifer feels ill, she tries to sleep it all hoping that the illness that she experiences will go away no matter. The only time she would go to a clinic or a hospital is when the pain can be considered to be unbearable. Contrary to her tolerance of illnesses, whenever her child feels ill, she instantly acts trying to find help. Ate Jenifer does not mind spending for her child as long as he lives, and is healthy.

D. Competitors With the given location of HealthLink in Barangay San Jose, Muntinlupa, the availability of 3 health care centers posed as HealthLink’s immediate competitor--- a hospital, a barangay clinic and a medical laboratory. Other competitors of HealthLink include self-medication and household priority. Below is a detailed discussion of the competitors. COMPETITOR H Vill Hospital (the quality and performance leader)

27 28

PROFILE The H Ville hospital is conveniently located at the center of the barangay; it is a private hospital in barangay San Jose, where it is funded by “donation, principal investment, or other means by the individual, partner, or corporation” 27. It is a general hospital wherein it is able to “provide all types of diseases, deformities, and illness.” 28 The H Ville Hospital has a capacity of

STRENGTHS -It offers a multitude of services that a regular hospital offers from internal medicine to pediatrics. -It is the biggest health center in the barangay thus most visible. -Most trusted by the people in the area. -They are open for

WEAKNESSES -The medical and consultation fees have an increase of 100%-300% depending on the pricing of the private doctor. -They usually have long waiting lines.

http://www.doh.gov.ph/files/ao2007-0041.pdf http://www.doh.gov.ph/files/ao147-04.pdf

Page | 35


Kasiglahan Infirmary

280 beds, of which 10% are for charity29 specifically allocated for indigent patients of social class C and D. The Kasiglahan Infirmary30 was established in 2003, located inside Kasiglahan Village, an urban poor community and a relocation site of former involuntary settlers in Metro Manila. It is a government infirmary where they offer diagnosis and primary care services--â&#x20AC;&#x153;complete blood count, white blood cell count, hemetocrit, differential count, qualitative platelet determination, urinalysis, fecalysis, and blood typingâ&#x20AC;? 31.

24 hours.

-It is an immediate cure health center. -They already have an immediate market to serve--the Kasiglahan village settlers, estimated to be about 230,000 32 inhabitants.

-They have a bad image as they are perceived by the people as small and unsanitary place. -There is only one doctor 33 and he is not always around so they usually refer patients to other nearby hospitals 34; there are about 13 nurses35 as the front liners. -They usually have long lines. -Closed during weekends and is usually opened during Mondays only. -Based from further interviews in the area, the locals claim that the facilities and equipments are extremely lacking

29

http://www.doh.gov.ph/files/ao2007-0041.pdf http://www.adb.org/Documents/Evaluation/Case-Studies/Involuntary-Resettlement-Safeguards-Policy/CSPHI.pdf 31 http://www.doh.gov.ph/files/ao2007-0027.pdf 32 http://www.filipinowriter.com/kasiglahan-village-urban-poor-exposure 33 ibid 34 ibid 35 ibid 30

Page | 36


Health Expert Medical Laboratory (the low cost quality leader)

Self Medication

Health Expert was established in 2008, it is located at the main street of Barangay San Jose, Montalban. It is a specialized medical lab clinic that is a privately owned establishment serving primary and secondary care--hematology, clinical microscopy, urinalysis, fecalysis, hepatitis tests, blood chemistry, enzymes, electrolytes, thyroid tests, serology, tumor markers, hormones, drug test, HIV, and limited bacteriology tests. The individual has the power to buy over the counter medicine at a generics pharmacy or drugstore. The individual is usually influenced by the following sources: television and radio commercials, referrals or advice from neighbors (word of mouth), and hearsays.

-The laboratory is perceived as reliable and clean by the people. -They are open during weekends.

-Over the counter drugs are easily accessible. -Tried and tested technique. -It is cheaper because they do not need to pay any consultation fee to a doctor.

forcing them to go directly to the hospital. -One quote from the local, â&#x20AC;&#x153;Kahit na yung BP na madalas kailangan ay wala rin.â&#x20AC;? -Patients ask for discount for the services they pay for (no fixed pricing).

-Some drug commercials are misleading. -The medicines that they used may not always be appropriate. -Lack of knowledge in medicine may lead to misdiagnosis.

Page | 37


Household Priority

The individual has household expenses to allocate their householdâ&#x20AC;&#x2122;s daily budget. The priorities of each household include food, payment for electricity and water bills, school expenses, health and medicine expenses, and other personal expenses.

-Households usually have cash on hand. -They are willing to pay for medical services when it is needed.

-Households have limited budget. -Based from area interviews, health expense is given the third priority from food and bills payment.

Table7: Competitors of HealthLink

E. Estimated Market Share and Sales HealthLink will be offering both a diagnosing service and a medical laboratory for general illnesses and will specialize in Pneumonia, Tuberculosis and other Bronchitis. The medical laboratory will offer primary and secondary assistance which includes hematology, clinical microscopy, urinalysis, fecalysis, hepatitis tests, blood chemistry [consist of white blood plate count and complete blood chemistry), enzymes, electrolytes, thyroid tests, serology, tumor markers, hormones, drug test, HIV, and limited bacteriology tests. Aside from these, HealthLink will be focusing on low-cost medical plug-ins for laptops, specifically an X-ray plug-in for the analysis of the specialized diseases.

HealthLink estimates that it will get a 5% market share in its first year of entry, 7% in the second year, and a 7% market share in its third year for San Juan alone. The increasing market shares of HealthLink is supported by the increasing trend of health expenditures in the country

Page | 38


in 2007. The expenditure shared of health is expected to boost as it is the fastest growing category for consumer goods, with a “14.1% real growth per annum between 2002-2007” 36.

Fig. 9 37: Real growth index showing performance of selected categories and the total 2001-2007

Also, HealthLink will capture the market that spends most of its household budget in health goods and medical services as HealthLink is targeting the low income wage earners of region 4a in the city of Rizal. The Table below show that “The lowest income earners (decile 1) spends about 5% of their budgets on health goods and medical services, compared to 3.7% spent by the middle income earners (decile 5), and 2.4% spent by the top income earners (decile10)” 38. There is great potential with the low income earners because they are the ones who lack basic health services and compose the majority of the population, hence penetrating a need in the market.

36

www.euromonitor.com ibid 38 ibid 37

Page | 39


Fig.10 39: Percentage of total consumer expenditure

HealthLink will be able to capture a big part of Brgy. San Joseâ&#x20AC;&#x2122;s market share in health services because HealthLink offers a convenient, fast, and affordable pre-screening for the low income wage earners who value affordability and fast pre-screening. This unique selling point of HealthLink will answer the problem of long waiting lines in Kasiglahan infirmary and in H Ville Hospital. Low income patients wonâ&#x20AC;&#x2122;t need to go back and forth to clinic to hospital or medical laboratory to hospitals for their medical examination results. HealthLink will be able to offer them the convenience of just going to one place for their medical tests and pre-screening diagnosis.

39

ibid

Page | 40


The revenue scheme that HealthLink will employ involves low margins but make up

for it with a high volume of patrons. HealthLink would do well with this kind setup because

ths would synchronize with its competitive advantage that creates fast turnovers. The expected 5% budget alotted will be enough because according to interviews with cetain

empoverished families, that given the dire need that they would be willing to spend P50 exactly for the use of one medical equipment (usually sphygmomanometer or nebulizer);

though they seemed to be very incessant that the price would not go over P50.

Page | 41


III. Marketing Plan

Page | 42


A. Identified Marketing Opportunity Basic health care is a right each Filipino should have. Unfortunately, this right has turned into a privilege that limited people have access to. Most urban poor areas in the Philippines do not receive basic health care services. The minimum health infrastructure required of a barangay, which is a health center, more often than not lacks equipment and skilled personnel. In San Jose, Montalban, the â&#x20AC;?Centerâ&#x20AC;? is said to opperate during weekdays. In reality however, it is only open on Mondays because no doctor is present throughout the remaining days of the week. In terms of facility, it does not even hold the basic apparatuses for vital statistics such as bloodpressure. Other medical infrastructures would be the hospital where doctors are overworked with the excessive number of patients.

On the part of the consumers, health issues are regularly present although these are only addressed when pain is no longer tolerable. Such attitude is from the perception of health care as limited to its currative aspect. They also associate it to cost. What the community fail to value is the importance of early diagnosis to prevent further complications and, in turn, lesser spending. If they are able to see clearer the direct correlation of health and productivity, with a value-for-money service, perhaps they will be more willing to invest in the detection of lifethreatening diseases. The commonplace beliefs of the people is an issue that HealthLink would also address by being a convenient source of medical information. The diagnostic function of HealthLink is also augmented by educating the people through its bi-monthly

newsletter.

Page | 43


Establishing a clinic in such strategic areas will automatically provide monopoly for the business. There is that unrealized volume and purchasing power of the D and E market in these areas. According to C.K. Prahalad the dominant assumption that the poor is not a viable market is faulty because they have the means to pay a premium for almost everything. Such premium is coined as poverty penalty. He sites Dharavi, India as a shanty town that applies the said penalty to everyday things such as rice and credit. 40 This is undeniably a common practice in the Philippines as well. For example, five-six is a familiar endeavor in poor communities. It has become an informal financial institution that provides them instant gratification with the consequence of high interest. If they are able to afford cellular phones and or television sets through this, surely they can afford health-related services if they choose to avail of it. The sheer volume of consumers will also help sustain the business as majority of the countryâ&#x20AC;&#x2122;s population face the same circumstances. Also, there is a consistent need for such services because of the nature of their environment, where congestion and high population density leads to the widespread of communicable diseases.

Overall, the huge gap in health care services manifests its consequences through the unsatisfied needs of the market. This is not being addressed because the consumers donâ&#x20AC;&#x2122;t realize this need and existing institutions overlook their capacity to be customers of this business.

40

Prahalad, C.K. The Fortune at the Bottom of the Pyramid: Eradicating Poverty Through Profits. Pennsylvania: Wharton School Publishing, 2006. Print.

Page | 44


B. Overall Marketing Objectives For the first year, HealthLink plans to provide basic health services -- general consultation and diagnosis as well as a medical laboratory for general illnesses -- for walk-in patients or HealthLink insurance members. HealthLink will also be specializing on pre-screening of respiratory problems, particularly, the detection of the following diseases -- Pneumonia, Tuberculosis and Bronchitis using the technology of digital imaging in X-ray as plug-in for any laptop. For its infancy stage, HealthLink will be putting up a concrete clinic in Montalban, Rizal, as it was identified as one of the municipalities in the Philippines lacking in health services. As mentioned, there are only three primary health infrastructures in the area – H Ville Hospital, Kasiglahan Infirmary and Health Expert. Henceforth, this will be a good market to penetrate for its first year. The initial year will also be an experimental ground for smoothing out all the procedures and equiment to be utilized in the clinic, from which easier copy strategy can be employed for succeeding franchises, similar to Gawad Kalinga’s expansion strategy. In terms of promoting the service, HealthLink plans to aggressively reach out to its customers through extensive below-the-line advertising strategies of the clinic to allow instant brand recognition that will eventually translate to patronage and loyalty of HealthLink’s services.

For the succeeding year, HealthLink plans to penetrate new markets by expanding in terms of services and other geographic locations. In terms of geography, HealthLink will penetrate communities within Rizal, the first expansion specifically would be San Juan, Taytay by year three. In terms of service expansion, HealthLink will be exploring other technologies that will diagnose other threatening diseases such as cancer and cardio-vascular illnesses. One Page | 45


example would be to use the same digital imaging technology, but with a different plug-in hardware that would detect cancer or ultrasound for pregnant mothers. Another would be the ECG technology, a recommendation given by Ma’am Arsol Reyes of the ECE department wherein the device tracks down the heartbeat wave form of the patient’s pulses. This aids doctors in determining if the patient is experiencing any heart complications that may lead to severe diseases However, due to financial constraints, the said evolution in technology would not be concretely adapted within the company’s three years. . C. Specific Marketing Objectives As previously stated, HealthLink plans to gain 8% market share in San Jose and 5% market share in San Juan by its third year. This can be done through aggressive sales and promotions of the company’s unique services. Consequent to the target market share, HealthLink plans to gain 2,281,538 pesos for the first year, and 7,712,311 pesos (for Sand Jose and San Juan) for the third year in sales revenues.

Sales volume for membership subscription is based on the expected market shares

multiplied by the total population of San Jose and San Juan, which are 93,567 and 88,321

respectively. The results are estimated in relation to the performance of HealthLink’s two

nearest competitors, Kasiglahan Infirmary and Health Expert (a medical laboratory). Currently on its third year, Kasiglahan Infirmary has an average of 11,680 patient base.

Health Expert, on its first year, has an average of 3,840. Also, research on health surveys

shows a total number of 2,671 cases of tuberculosis and 1,314 cases of pneumonia in San Page | 46


Jose, all of which are target clients. Given the competitive edge of HealthLink while taking

into consideration having competition, the company’s projections are set to be in between that of the two medical centers. Sales and profit projections are then primarily outcomes of

pricing and estimated costs. In order to realize the target sales, Health Link plans to employ an

integrated marketing communications (IMC) plan that aims to foster customer loyalty. In terms of quantification we’ll be focusing on 5 IMC components – direct marketing, events, sales promotions, below the line advertising and public relations, following a specified media schedule for the next three years. Below is a summarized table of objectives for the next three years.

Expected Market Shares Sales (volume for membership subscription) Sales (projected revenue from walk-ins in Pesos) Sales (projected total revenue in Pesos) Profit Levels (based on projected revenues and cost of service) Distribution Coverage

Year 1 5%

Year 2 7% 6,484

7,668

4,416

P540,000

P540,000

P540,000

P507,600

4,678

P2,821,538

Year 3 8%

5%

P2,489,494

P4,313,093

P 3,734,838

P5,051,092 P2,661,219

San Jose, Rodriguez

San Jose, Rodriguez

San Jose, Rodriguez

Table 8: Market Forecast

P4,346,038 P2,410,745 San Juan, Taytay

Page | 47


D. Overall Marketing Strategy (4 Pâ&#x20AC;&#x2122;s) 1. The Product More than medical technicalities, HealthLink sells quality life. It aims to bring families closer to their aspirations by keeping them safe from life-threatening illnesses and maintaining healthy bodies. By addressing the physical well-being of customers, the business consequently is able to provide productivity and peace of mind.

HealthLink is an eClinic that employs telemedicine technology. It includes the basic services of a regular clinic, which is essentially diagnosis. It will be focusing on potentially fatal prevalent diseases within a community. For example, in its entry phase, the first eClinic will be established in Brangay San Jose, Montalban, Rizal, where respiratory illnesses are common. Emphasis will be given to pneumonia, tuberculosis and bronchitis, all of which are at the top 5 causes of mortality in Rizal. Telemedicine equipment, such as X-Ray plug-in for laptops, will then be used for faster and more accurate diagnosis. HealthLink provides the convenience of eliminating unnecessary travel to Manila for the patients, reducing cost, and physical and emotional stress from their experience of medical attention. Also, HealthLink will be using a centralized electronic database for a more efficient transfer of medical records when referrals are necessary. Moreover, the business is very patient-centered. It aims to create partnerships rather than transactions. Service will be delivered in an unintimidating and accommodating way. It will introduce and maintain itself as a member of the community as shown in the succeeding promotional strategies.

Page | 48


Aside from being the only clinic with telemedicine functions in the area, HealthLink will extend its services to patients even after sales. Loyal customers will get, among other things, a bimonthly health digest that aims to promote preventive health care and serves as a promotional and feedback avenue for the company.

a. The Brand HealthLink. “Konektado ka sa kalusugan.” The brandname and tagline aims to encapsulate connectivity in the two ways that it is relevant to the company: 1) bringing health care to communities and 2) providing it through technology. In addition to that, connectivity is also evident in the company’s community partnership approach in conducting business. As a company, it aims to exhibit trustworthiness. It is customer-centric. Services aim to provide the greatest amount of convenience while demanding personal responsibility and financial accountability from the patients. This mix is structured such that a balance relationship between the company and patients foster empowerment for all.

HealthLink is visually translated into a plain-text logo. Colors are green for the word “Health” and the letter “I,” and grey for the remaining letters. The logo’s simplicity and the boldness of the text makes it easier to identify in print materials. A clean look is balanced with a bright colors and informal font face to evoke credibility and professionalism while exuding amiability.

Page | 49


Fig.11: HealthLink logo

b. Positioning Statement To families with low income living in highly congested urban poor areas who are on a tight budget and want to keep themselves safe from life-threatening diseases, HealthLink is the brand of eClinic (diagnosis center propelled by technological advancements) that enables them to identify significant actions that address their health concern such that they gain peace of mind and live a productive life with ease. The reasons are 1) tailor-fit of technology to the specific health needs of the community 2) integration of clinical and laboratory services and 3) community centric philosophy. The brand character is affordable, approachable and appropriate.

2. Price Services range from general consultation and diagnosis, medical lab tests and Xrays, depending on what package the patient-member availed of. To achieve a competitive price range, coupled with a strategic business model, Healthway researched on the various prices and services of its competitors to gain insight on what should be

Page | 50


the right pricing of Healthwayâ&#x20AC;&#x2122;s services. Below is a table detailing the different price range for a particular service of a competitor.

Consultation Fee

X-ray Hematology Complete Blood Count Platelet Count HGB & HCT Bleeding Time Clotting Time Reticulocyte Count ESR ABO & RH typing PBS/Peripheral Blood smear LE Preparation Protime/PT APIT/PIT Clinical Microscopy Urinalysis Fecalysis Urobilinogen Ketone/Acetone Biles/Nitrates/Bilrubin Sugar Micro-Alburnin Test Pregnancy Test Occult Blood Concentration Technique Urine Test Creatinime Total Creatinine Clearance Protein

H Ville Hospital 100-300Php depending on the collection of the physician 1,000Php average

Health Expert* 100-300Php depending on the collection of the physician

HealthLink 100

-

500

280 250 270 250 250 350 320 280

80 50 70 50 50 150 120 80

75 47 67 47 47 140 115 75 150

360 450 450 500

160 250 250 300

235 235 285

250 250 280 280 280 280 600 300 350

50 50 80 80 80 80 400 100 150

47 47 75 75 75 75 380 95 140

290 450 550 400 450

90 250 350 200 250

85 235 235 190 235 Page | 51


Na/K/Cl (each) Calcium/Magnesium (each) Uric Acid Amylase Glucose VMA Hepatitis HbsAg (screening) HbsAg w/ titer (ELISA) Anti-HBS w/ titer HbeAg Anti-Hbe Anti-HBc IgM Anti-HBc IgG Anti-HAV IgM Anti-HAV IgG Anti-HCV Hepatitis Profile Hepatitis A Profile Hepatitis B Profile Hepatitis A, B, C Profile Wee Bag 2Hr Post Prandial Blood Blood Chemistry FBS/RBS OGCT OGTT BUN/CREATININE (each) BUA Cholesterol Triglycerides HDL/LDL (each) Bilirubin (TB,DB,ID) Total Protein Albumin TPAG HBA1C Enzymes

450

250

235 235

450 450 450 450 1,500

250 250 250 250 1,100

235 235 235 1,045

400 500 500 550 550 550 550 550 550 850 2,000 1,100 2,000 2,700

200 300 300 350 350 350 350 350 350 650 1,500 900 1,500 2,200

190 285 285 330 330 330 330 330 330 620 1,425 855 1,425 2,090

115 400

15 200

14 190

300 500 750 300

100 300 550 100

95 285 520 95

300 300 350 350 550 350 350 500 700

100 100 150 150 350 150 150 300 500

95 95 140 140 330 140 140 285 475

Page | 52


SGPT/ALT SGOT/AST GGTP Alkaline Phophatase Acid Phosphatase Amylase Lipase Total CPK CPK - MB CPK - MM Troponin I/T (each) LDH Electrolytes Sodium Potassium Chloride Magnesium Inorganic Phosphorus Total Iron TIBC + TOTAL Iron Calcium Ionized Calcium Thyroid Test T3/T4 (each) TSH FT3 FT4 FT1 Serology VDRL/RPR TPHA Screening TPHA w/ Titer Widal Test Typhidot ASO Titer CRP w/ titer 250 RA/RF Latex C3/C4 (each) ANA Screening ANA w/ Titer Dengue IgM & IgG Leptospiral Test

310 310 700 380 380 450 500 800 800 800 1,000 600

110 110 500 180 180 250 300 600 600 600 800 400

105 105 475 170 170 235 285 570 570 570 760 380

330 330 330 450 450 600 850 450 550

130 130 130 250 250 400 650 250 350

120 120 120 235 235 380 620 235 330

450 600 650 650 650

250 400 450 450 450

235 380 430 430 430

350 600 800 550 900 550 400 550 900 1,100 1,300 900 1,000

150 400 600 350 700 350 200 350 700 900 1,100 700 800

140 380 570 330 665 330 195 285 665 855 1,045 665 760 Page | 53


H.Pylori Rubella IgM Rubella IgG CMV IgM & IgG Toxoplasma IgM Toxoplasma IgG Bacteriology Gram Stain AFB KOH India Ink Blood C/S Culture Sensitivity Hormones FSH/LH Prolactin Estrogen / Estradiol Progesterone Testosterone Cortisol Ferritin Tumor Markers AFP CEA PSA B-HCG CA-125 CA-15-3 CA-19-9 CA-72-3 Drug Test MET / THC HIV Test HIV Screening Test HIV w/ Titer (ELISA) Others Stone Analysis PAP Smear

1,100 1,000 1,000 1,300 1,300 1,300

900 800 800 1,100 1,100 1,100

855 760 760 1,045 1,045 1,045

400 550 500 550 700 650

200 350 300 350 500 450

195 330 285 330 475 430

900 900 1,000 1,000 1,100 1,100 1,000

700 700 800 800 900 900 800

665 665 760 760 855 855 760

1,200 1,100 1,300 1,000 1,700 1,900 2,200 2,700

1000 900 1,100 800 1,500 1,700 2,000 2,500

950 855 1,045 760 1,425 1,615 1,900 2,375

500

300

285

700 1,000

500 800

475 760

600 280

400 80

380 75

*average prices, can be negotiable **HealthLink rates are those applicable to walk-in patients. Discounts will be granted to card holders. Table9: Price list

Page | 54


Apart from this data, HealthLink surveyed a sample of the target population to know their price ceilings for specific health services. According to the data, the price ceiling or the limit to which the customers will pay for the service is around 350 pesos for one consultation. The ideal for them would be around 100 to 120 pesos. To ensure; however, that there will be constant influx of income, we will be promoting HealthLinkâ&#x20AC;&#x2122;s services in an insurance scheme through a monthly or one-time payment that is affordable to them at a certain period of time. The basic benefits would be either free consultations or discounts on services in case they need to consult a doctor at a specific time.

Apart from that, HealthLink researched other clinics that also offer other insurance services, one of which is Friendlycare. Friendlycare offers different package insurance cards with a price range of 980pesos (minimal services), 1,600pesos (health plus, inclusive of more discounts and service options), 1,400 pesos (baby) and 1,200 pesos (kids), all for one year service. Given this marketing information, HealthLink will be strategically pricing its services in a summarized table below. Package Price (1 Year)

Benefits - Depends on the service availed of

Walk-in Consultation 80Php / consultation See lab tests and X-Ray prices on the price-comparison list

Page | 55


- 1 year’s worth of health services - Free unlimited consultations - 15% discount on all laboratory tests - 20% discount on all X-Ray tests

Classic Membership 500Php (1 instalment for 1 year) 90Php (6-month instalment) 50Php (12-month instalment) - 1 year’s worth of health services - Free unlimited consultations - Free health digest, bimpo and first aid kit - 25% discount on all laboratory tests - 40% discount on all X-Ray tests Premium Insurance 999Php ( 1 instalment for 1 year) 180Php (6-month instalment) 100Php (12-month instalment) - 1 year’s worth of health services for 5 members - Free unlimited consultations - Free health digest, 5 bimpos and first aid kit - 35% discount on all laboratory tests - 50% discount on all X-Ray tests Family Insurance 1999Php ( 1 instalment for 1 year) 350Php (6-month instalment) 180Php (12-month instalment)

* Condition for membership- 2 months initial payment Table10: HealthLink packages/List of services

Fig.12: Back View of membership card Page | 56


3. Place The chosen location is Barangay San Jose in Rodriguez, Rizal. According to the National Epidemiology Center of the Department of Health, Rizal is the largest and most populous of the barangays with a total population of 1,650,075 people as of year 2007. It is the first barangay of Montalban coming from Quezon City. The Montalban Public Market and the Town Center is located within the area. It is also a location of several relocation sites of informal settlers from Manila and other places.

With only very few health facilities in the area such as Hvill Hospital, Kasiglahan Infirmary and Health Expert Medical Laboratory, people have to go all the way to Manila such as Quezon City or Tondo to visit their own doctors. Although they have the local infirmary, they opt to visit other health facilities even if they have to travel more distance since they are completely unsatisfied with the services and treatments available in the local infirmary. Diagnostic centers also exist but with limited medical equipments. Most do not have x-ray and ultrasound machines which are being sought for by patients. The nearby Hville hospital is often visited especially for major concerns but the people criticize it for being expensive and having long patient lines. Because of these limitations within the area's existing health facilities, the people end up ignoring symptoms of illnesses and do selfmedications instead.

For the expansion stage on the third year, HealthLink will locate its second branch in San Juan, Taytay Rizal, as it is the second to San Jose in terms of population with 88,321 Page | 57


residents as of year 2007. The same deseases are prevalent in the area, making the replication of the HealthLink clinic more relevant and viable. Also, having the two clinics in Rizal will make operations smoother.

4. Promotions HealthLink will be using five marketing communication channels in promoting its services. These are advertising, events, sales promotions and point of purchase communications, direct marketing and public relations. The main objectives of the formulated marketing mix are to spread product knowledge, encourage patronage, and establish and maintain brand loyalty. Integrated into these objectives is promoting proper health education to the community to promote the preventive rather than the curative aspect of medicine. To achieve these, integration to the community is vital. The company must create and sustain an open line of communication. HealthLink will be available and open to receive feedback from the people so that its future services may be refined. This will also allow it to maintain a good line of visibility such that consumers and potential partners may be updated with its development.

a. Advertising The main role of this channel is to provide HealthLink with the visibility it needs for the public to know of its existence and eventually be aware of its services. The medium to be used will be limited to print, with primary focus on tarpaulins, posters, flyers and stickers â&#x20AC;&#x201C; most of which are small enough to be distributed. Other media will Page | 58


not be used because the exposure needed by the company is only within the barangay. Broadcasting advertisements is unecessary and will not be cost-efficient. To widen the visibility reach of the materials, quantity will be favored over size.

Tarpaulins will be erected on the site of the clinic even before it operates to stir interest from passersby. Posters will be placed in central areas such as hospitals, the barangay hall etc., while flyers will be posted in public transportation such as tricycles and jeepneys. Stickers will then be distributed to individuals or potential customers instead of the fliers. This material guarantees greater longevity than the latter because people, especially children, are less likely to throw them immediately. Instead, stickers may be used as decorative accessories to personal belongings. In such cases, those belongings serve as some sort of moving advertisement. The limitation of this material would be the size. Hence, its function would primarily be brand name recognition and retention. More detailed information may be seen in the fliers and posters. Distribution will start even before the construction of the clinic. The timeline for each material is indicated below.

Duration **

14 weeks before

Other events

Foundation Construction of the of the infrastructure infrastructure 2 300 stickers 50 30 70 tarpaulines posters posters fliers 100 fliers

Material to be released

12 weeks before

10 weeks before

8 weeks before

6 weeks before

4 2 weeks weeks before before

Week of the opening Launch of the clinic 700 300 stickers stickers

**in relation to the opening

Table11: Advertising TImeline Page | 59


Fig.13: Sticker

Fig.14: Poster 1

Fig.15: Poster 2

Page | 60


Fig.16: Flyer 1

Fig.17: Flyer 2

b. Events Marketing through this channel will enable HealthLink to arouse interest in the public. It will reach audiences in a more personal way compared to advertising. This will also create hype about the product and serve as the businessâ&#x20AC;&#x2122; initial interaction with the community â&#x20AC;&#x201C; an opportunity to introduce the business to potential stakeholders. There are two main events that will mark the establishment of HealthLink: the build and the launch.

The build, Bayanihan Para sa Kalusugan, is an effort to make the remodeling of the clinic a community activity. It is symbolic of bayanihan and will promote a sense of Page | 61


ownership on the part of the public. Participants will get a free membership insurance valid for 3 months and the privilege to be the pioneer customers of the HealthLink. Volunteers from partner organizations (Philippine Government Hospital, Philippine Tuberculosis Society and Philippine Lung Center) will be there to provide manual labor assistance and to facilitate the program. Because it is intended to be a family event, the format of the program will be that of a game show. The production will be patterned after those on television such as Pinoy Henyo. Only this time, the overall theme will be health. Registration will start two weeks before the activity. It will be held in the eClinicâ&#x20AC;&#x2122;s site. The launch, Siklab: Kapit Kalusugan, aims to officially begin the business with excitement from the community. The main objective of this event is to showcase the different services of the clinic and promote a more health-oriented mindset to the public. It is an opportunity for product demonstration to be conducted, which will be lead by partner-organization volunteers and the builders in the previous event, the documentation of which will be showcased. It will have free check-ups similar to those of medical missions. The overall approach to the activity will be like a family fair with a variety show-like program and mini sportsfest to advocate preventive health through fitness. This will be done in the barangay basketball court about two hundred meters from the HealthLink. .

Page | 62


c. Sales Promotions & Point of Purchase Communications This channel contributes an instant boost in sales while exposing more people to the product. It encourages the target market to patronize HealthLink. Point of purchase communications includes the service menu and announcement board outside of the clinic. This aims to attract walk-ins by displaying the wide array of medical attention they can avail of. POP will be employed throughout the operation of HealthLink.

Sales promotions have components. The first is referrals. When a member refers 3 people, his/her membership will be upgraded to the more superior kind. Second is group registrations. When a group or a family of 5 registers for the same package at the same time, one of the memberships will no longer be charged. As such, the group will pay for the amount of 4 insurance to avail of 5. The referals and group registration incentives will be applied within the first month and during December of the first year. There will also be freebies given to patients who will sign up for the membership card.

Fig.18: Free Mug

Fig.19 : Free Towel

Page | 63


Fig.20: Service Menu-change discounts

Page | 64


d. Direct Marketing It has been mentioned in the main objectives of the promotions strategy is to establish and maintain brand loyalty. Simultaneous to other IMC efforts and even after their proposed timelines, is important to have a constant reinforced communication that will go beyond information and will call the target market into action. This channel, working with specific targets, solicits immediate response from its recipients. And because it is customized by nature, it is able to facilitate lasting relationships.

To concretize these into action, a database is necessary. To keep in touch with walk-ins/non-members and to track the activity of members, every customer will be required to register before availing of any service. This will be separate from the members database that will hold clientsâ&#x20AC;&#x2122; personal medical records.

The direct marketing program will be in the form of the bi-monthly digest, which will be given to premium and family cardholders. This will contain trivial health tips and more importantly, it will serve as a tool for information dissemination. Service and sales promotions update and will be included in the digest. It is also an avenue for customersâ&#x20AC;&#x2122; feedback about the business to be heard. This will keep customers involved in the business and HealthLink personnel alert in providing quality service all the time.

Page | 65


Fig.20: Sample of HealthiLink bi-monthly publication Sample paid advertisement

Page | 66


e.

Page | 67


Page | 68


HelathLink will also conduct direct marketing initiatives involving public health centers, particularly Kasiglahan Infirmary. As indicated in “The Business” indigent patients will be sponsored by HealthLink in exchange for a local business tax exemption. In order to empower these patients and their families in the area of health and avoid the notion that HealthLink is a charitable institution, they will be trained to become health workers that will conduct focus group forums on current health issues, called “Usapang Kalusugan.” There will be a different topic to be discussed per month. Health workers will also be given the option of selling membership cards using a face-to-face approach. As an incentive, they will get a comission of twenty percent of their sales. This way, since most of the indigent patients come from Puray, a more rural barangay in Rodriguez, having them as health workers may even expand the geographic market of HealthLink.

e. Public Relations This channel provides low-cost and long-term promotions in the mix. It intends to support direct marketing in strengthening the community’s trust and customers’ loyalty. All actions will be directed to fostering good relationships with existing medical institutions and local government unit, and activate positive word-of-mouth.

Concretely, the PR plan includes a testimonial segment in the bimonthly digest and providing free first aid in barangay events. The testimonial segment is somewhat a more lengthy version of the feedback. It features success stories of patients who have Page | 69


been treated of a potential fatal illness because of early detection. The first aid sustains the HealthLinkâ&#x20AC;&#x2122;s visibility and integration in the community. Similarly, the forums done through the indigent group may also be considered as a public relations activity as it fosters closer ties with the communy.

Page | 70


III. Operations Plan

Page | 71


A. Process Strategy HealthLink is a clinic that will be focusing on respiratory problems such as pneumonia, tuberculosis and bronchitis. Aside from that, it will also offer services of a diagnostic clinic such as clinical microscopy, blood chemistry and X-Rays. The clinic will be employing a systematized way of delegating procedures and an integrated networking of data exchange to ensure an accurate, coordinated and exemplary service of the staff to the patients. The process flowchart is showcased at the image below.

Page | 72


Fig.22: Process Flow

Page | 73


B. Capacity Planning The demand forecasting is a linear regression (a=74.5 b=1.03846 y=74.5+1.04x) showing the monthly demand of a similar establishment that offers lab services for the lower income bracket in San Jose, Rodriguez. Month Dec 2008 Jan 2009 Feb 2009 Mar 2009 Apr 2009 May 2009 Jun 2009 Jul 2009 Aug 2009 Sep 2009 Oct 2009 Nov 2009 Dec 2008 Total Yearly Demand Monthly Average Demand

Demand 67 71 93 88 83 81 74 75 83 69 102 89 67 975 81.25

Table12: Demand Forecasting

Fig23: Linear regression graph (a=74.5 b=1.03846 y=74.5+1.04x)

Page | 74


Below is a time-based capacity estimation of how many patients can HealthLink serve. Under the best case scenario, HealthLink assumed that if everybody will only avail of the laboratory service, the throughput time would be 18 minutes and 20 seconds. When the doctor requires a patient to take a medical examination the throughput time would be 36 minutes and 20 seconds, but with two doctors working at the same time. When the patient goes to the doctor only with the assumption that he has an appointment, the throughput time would be 27 minutes 30 seconds, but with two doctors working at the same time.

Doctor (2) Lab Reception Nurse Tiolet

Throughput times 10-30 min 10-20 min

Waiting times 2-15 min 2-16 min

10-20 min (noncardholder), 15-25sec cardhorlder) 2-4 min

0 min

BEST CASE SCENARIOS TURNOVER LAB ONLY Cardholder (15 secs) Appt (2 mins) wait for medtech Lab 10 minutes Pay 30 seconds

2-4 min *assumption, turnover time = 2 min EXPECTED ACTUAL LAB ONLY Cardholder (20secs) Appt (2 mins) wait for medtech Lab 15 minutes

Doctor sent to lab Cardholder (15 secs) Appt (2 mins) Nurse (2mins) wait for doctor 2mins

Pay 1 minute Total 18 minutes 20 seconds Doctor sent to lab Cardholder (20 secs) Appt (2 mins) Nurse (3 mins) Wait for doctor 2 minutes

doctor 10mins sent to lab 1 min wait for medtech 2 mins

Doctor (13 minutes) sent to lab (1 minute) Wait for medtech (2 mins)

Lab 10 minutes Pay 30 seconds

Lab (12 mins) Pay 1minute

TOTAL:12mins 45 secs

TROUBLED EXPECTED ACTUAL LAB ONLY Cardholder (30 secs) Appt (3 mins 30 seconds ) wait for medtech Lab 20 minutes Pay( 2 minutes) Total (25 minutes 30 seconds) Doctor sent to lab Cardholder (30 secs) Appt (3 minutes) Nurse (4 minutes) Wait for doctor (5 minutes) Doctor (30 minutes) Sent to lab (1 minute) wait for medtech (3 minutes) Lab (20 minutes) pay (2 minutes)

Page | 75


Total: 29 mins 45 secs Doctor only (with appointment) Cardholder (15 secs) Appt (2 mins) Nurse (2mins) Wait for doctor 2 mins

Total: 36 mins 20 secs Doctor only (with appointment) Cardholder (20 secs) Appt (2 minute) Nurse (3 minutes) Wait for doctor (2 minutes)

Doctor 10 mins Advice 5 mins Pay 1min

Doctor (13 Minutes) Advice (5 minutes) Pay (2 minutes)

Total :22 mins 15 sec

Total :27 minutes 20 secs

Total: 68minutes 30 secs Doctor only (with appointment) Card holder (30 secs) Appt (3 minutes) Nurse (4 minutes) Wait for doctor (5 minutes) Doctor (30 minutes) Advice (7 minutes) Pay (2 minutes) Total :51 minutes and 30 seconds

BEST CASE SCENARIO (8AM-5PM, +LUNCH BREAK) all patrons cardholders, have appointments and arrive on time Most likely (8AM-5PM, +LUNCH BREAK) Lab Test only with appointments Estimate 37 patrons Estimate 26 patrons Estimate 18 patrons (8*60/14.5) Doctor check-up which requires a lab test be taken Estimate 32 patrons for two Estimate 26 patrons Estimate 14 patrons doctors sending to lab Doctor check-ups only with appointments Estimate 42 patrons (2 Estimate 34 Patrons Estimate 18 patrons doctors cuts doctor time) *Formula Used: (Hours a day X Minutes in an Hour)/(Total time per category) (8X60)/Total time 480/total time

Table13: Capacity Planning Computations

Because purely doctor visits, purely lab tests and purely doctor visits that are directed to the in-house lab is infeasible, the three values must be further refined. Going by the formula given below, we can expect the following capacities based on how fast HealthLink can serve its patrons. Estimated Patrons = (doctor only) + (lab only) â&#x20AC;&#x201C; (combination of doctor and lab) Expected Case 34 expected patrons Best Case 47 expected patrons Troubled Case

22 expected patrons Table14: capacity Planning results

Page | 76


Reception Phase Personnel Involved: Receptionist Equipment: Card Scanner, Computer In the reception phase, the patients are separated into cardholders and noncardholders. For card holders, they can immediately swipe their card into the car reader to retrieve their personal records. This will take around 15-25 seconds. After which, they wait for the nurse to assess them. For non-cardholders, they will be presented with various HealthLink plans available via a computer. This will take around 5-10 minutes. If the patient does avail of the plans, the receptionist will create a personal patient record for him or her. Creating a patient record will take around 5-10 minutes.

Patient waits for nurse The patients wait for the nurse. The waiting times varies. For those with appointments, the waiting time is 2 minutes, while it will take 2-10 minutes for those without appointments.

Nurse Station Personnel Involved: Nurse Required equipment: Sphygmomanometer, Thermometer, Stethoscope, Computer When the nurse sees the patients, the nurse takes and records the patientâ&#x20AC;&#x2122;s vital stats such as the temperature, blood pressure, and the heart rate. This will take around 3-4 minutes. The personnel and equipment needed is the nurse, a thermometer, sphygmomanometer (used for measuring blood pressure), a weighing scale to check the patientâ&#x20AC;&#x2122;s weight, and a Page | 77


stethoscope to check the patient’s blood pressure and heart rate. All of these will be recorded on the computer in the patient’s records.

Patient waits for doctor After seeing the nurse, the patient then sits down waiting for the doctor. This usually takes 2-10 minutes for those with appointments and 2-20 minutes for those without appointments.

Consultation with Doctor Personnel involved: Doctor Equipment Needed: Stethoscope, Tongue Presser, Otoscope, Computer Upon seeing the patient, the doctor performs a general check up on the patient. In doing so, the doctor will be using a Stethoscope to check the patient’s lungs, a tongue presser to check the patient’s throat, and an Otoscope to check the eyes, ears, and nose of the patients. After which the doctor will ask some questions in order to better diagnose the patients. All findings will be placed in the computer. This will take around 13- 30 minutes depending on the situation. After the diagnosis, the doctor will perform one of the 3 options below: o Refer non-related illnesses to hospitals. This will usually take 10 to 20 minutes and will be done via the computer or use of telephone. o Gives medical advice prescription to the patient for general illnesses such as colds and coughs. This usually takes 5 minutes. Page | 78


o Refer the patient to the laboratory for respiratory and other illnesses covered. This usually takes around 1 minute. Lab testing Personnel Involved: Medical Technician Equipment Needed: Medical equipments such as the compound light microscope and electrolyte analyzer For the patients partaking in the lab testing services of the clinic, the patients will be classified into three categories, upon which the waiting time varies. For those who made an appointment with the lab, the waiting time would be 2 minutes. For those who were sent to the lab by the doctors, since they have priority, they will wait around 2-5 minutes. Lastly, for those without appointments and wish to undergo lab testing, the waiting time will be approximately 5-10 minutes. Depending on the tests, the average time for performing examinations will be 10-15 minutes. The equipment the medical technician will be using will vary on the different tests. The medical technician after analyzing the tests will then make a report, print it, and input it in the patient database using the computer. This will take around 12 minutes.

As for the utilization of the equipment, all of them will be working under capacity at around 80% at maximum capacity utilization for the human labor. Many of the equipment have a relatively short useful life compared to how long the asset can remain usable; this is because HealthLink will advocate an early turnover of equipment to maintain its competitive advantage of cutting edge innovation. Page | 79


Payment process Personnel Involved: Receptionist Equipment Needed: Computer In paying, the patients will be categorized into cardholders and non cardholders. Cardholders simply go to the receptionist to inform the receptionist that she is finished, and she will swipe her card and be on her way. On the other hand, non-cardholders will have to go to the receptionist and pay cash. This will take around 2-5 minutes.

C. Quality Management 1. Definition & Dimensions of Quality At the end of each visit, the company wishes customers to feel that HealthLink is the reliable choice. In HealthLink, they can expect quality service. That is, low-cost and highly efficient need-specific clinical consultation and laboratory services. Specialized services differ per community as these depend on life-threatening diseases most prevalent in the area. The efficiency, cost and appropriateness of the services are brought about by the added technology unique to HealthLink clinics. These are further explained through the various dimensions of quality of the company. The House of Quality (see appendix 1) that shows the relationship of customer needs and the value that HealthLink offers. It also shows how competitors address the demands of the market. This is discussed in detail in each section below. Affordability â&#x20AC;&#x201C; In the medical field, there is not much product differentiation. Also, the target market in Rodriguez, Rizal, is composed of very price conscious consumers. As such, price competitiveness is one of the qualities patients can expect from patronizing Page | 80


HealthLink. This will be addressed by assigning relatively lower prices on each service and bundling multiple products into packages that consumers can pay within a certain period of time. It is evident in the House of Quality how most aspects of the business answer to the need of patients of a low-priced service.

Service Appropriateness â&#x20AC;&#x201C; Each HealthLink branch ensures services that cater to the specific needs of a community. The first branch for example, will specialize on pulmonary diseases namely, pneumonia, bronchitis and tuberculosis. This will be the basis for the technologies to be used that are unique to the clinic to increase cost efficiency and aid in providing faster services. By using telemedicine technology, the clinic will be able to employ supposedly huge equipment. In the first branch, instead of using a bulky x-ray machine, HealthLink will use a laptop plug-in. The House of Quality shows how the use of advanced technology is relevant to the needs of the customers. Four out of five needs have a medium to high relationship with this factor.

Wide Range of Services â&#x20AC;&#x201C; A unique selling point of a HealthLink clinic that it will strive to keep is itâ&#x20AC;&#x2122;s wide range of services. Patients of nearby hospitals and infirmary usually have to go elsewhere for laboratory services due to the low capacity of the said businesses. On the other hand, even those external laboratories do not provide enough services. For example, Health Expert, a laboratory in Rodriguez, turns down many patients because they do not have an x-ray machine. HealthLink is a one-stop-shop where consultation and laboratory tests are available. Like in the low price customer Page | 81


requirement, the need for having multiple services is addressed by four out of five solutions from the company.

Accessibility – HealthLink ensures that each clinic is strategically located in areas frequented by traffic. It serves as an added value for customers to be offered a set of services that is available within the vicinity of places they go to each day. The first clinic will be situated near 3 schools, a church, informal market vendors, and a pharmacy among others. Although it garnered low ratings in the House of Quality, in the bigger picture, it contributes to HealthLink’s competitive advantage over other Manila-based medical businesses, as it taps underserved markets where demands are high.

Short Waiting Time – In order to constantly serve more patients, special attention will be cast on reducing waiting time. This has been discussed in the Process Strategy. The efficiency of such process will be persistently monitored by the Clinic Manager. If needed, it will be reevaluated and changed to cater to the demand of a community.

Clean and Efficient Facilities – Healthcare facilities available to HealthLink’s target market are often lacking in facilities and unhygienic. Even though potential customers did not explicitly mention the need for this factor, HealthLink sees it as a crucial aspect of its service being in the medical field. And although investing in cleanliness and facilities would incur greater costs, it adds great value to the product. Aside from

Page | 82


ensuring the safety of the patients, it also exudes a more trustworthy image. This will also lengthen the lifetime of HealthLink’s properties.

Good Customer Service – The business will be highly customer-centric. Hence, it is not enough to simply diagnose and examine the patients. What will make them want to come back is the attention and manner by which they were received by each personnel in the clinic. Also, service will follow the customers even after they leave the infrastructure. Certain cardholders will receive a bimonthly digest that provides health tips and updates on services. For those diagnosed with serious illnesses who need to be referred to a hospital, special arrangements can be made through HealthLink so that they can secure a specialist and their records can be shared smoothly. As shown on the figure, this is the most crucial design requirement as it exhibits the highest relationship to the customer requirements. 2. Quality Assurance Systems R&D Department – The Research and Development Department plays a key role in ensuring HealthLink keeps its price and technological competitiveness. The department is in charge of keeping the company up to date in the technological applications relevant to the medical field. Researchers are tasked to continuously look for alternatives that would decrease cost and increase efficiency through innovative solutions.

Customer Feedback – HealthLink will live up to its customer-centric philosophy by making the customer an active participant of quality assurance. There will be comment drop Page | 83


boxes in the reception area, so patients can leave their comments or suggestions at any time. Also, there will be an evaluation sheet attached to each bimonthly digest, so that cardholders who are entitled to it can regularly provide their assessment. This effort aims to increase the managementâ&#x20AC;&#x2122;s awareness of its performance as well as increase customer involvement in the business.

Human Resources â&#x20AC;&#x201C; HealthLink puts primacy on its human resources because it believes that its personnel are the backbone of the business. It is critical to have both discipline and passion in the work place. Hence the two quarterly employee surveys: performance evaluation and Job Satisfaction Rating.

For the Performance Evaluation, each personnel will have a self-evaluation and an evaluation from those at a higher position. After the two written assessments have been accomplished, the Clinic Manager will have an Individual Consultation with every staff, relaying the results. This will provide an open line of communication between the management and the clinic staff. It will also keep each personnel consistently aware of the things they have to improve on and keep up.

The Job Satisfaction Rating is helpful in sustaining the staffâ&#x20AC;&#x2122;s passion for serving. It will also show them that the management does not only care about the output they produce but also in their own professional development. Since monetary compensation is minimal, it is important for the management to identify other means by which employees Page | 84


can be motivated. This survey gives them a regular access to employees’ perception of the working environment and their job fit. This will be included in the Individual consultation with the Clinic Manager.

D. Location Planning 1. Clinic Location Planning HealthLink will be establishing its first branch in the region 4a of Calabarzon, specifically in Mayon Street, San Jose, Rodriguez, Rizal. The factors that HealthLink will consider in choosing its first location will be the basic health statistics of the area. This includes the estimated population and its number of households, mortality rate, natality (live births) rate, and the number of available local government unit’s health workers in the area. The second factor would be the rate of pneumonia of the area because this is the disease that will benefit most from the starting technology of HealthLink which is the portable x-ray. The third factor that HealthLink will consider will be the human flow or the accessibility of the chosen location.

For the first factor considerations, Calabarzon (region 4a) has a total population of 11,743,110 41 vis-à-vis Rizal’s population of 1,650,075 (14.05%) 42 and a 348,125 43 households of region4a’s total population, which are both the second largest provincial population in the region. A large population means a big market to offer HealthLink’s services. The mortality rate of the chosen region has a relatively high to moderate death rate with 46,926 number of deaths

41

National Epidemiology Center, Field Health Report Service Information System, page10, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf> 42 Ibid 3 National Epidemiology Center, Field Health Report Service Information System, page137, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf>

Page | 85


or a death rate of 4 44 (5.6 is the highest in region 6 and 1.0 is the lowest in ARMM). On the other hand, a promising crude birth rate of 21.4% 45 (23.6 is the highest in region6) of the Philippinesâ&#x20AC;&#x2122; total births of 1,860,871 46 signal room for expansion, especially since HealthLink will be incorporating improvements in technologies on its succeeding operations, as well as, a continuous market to serve. In region 4a a total of 247,365 births happen annually and in Rizal alone, there are a total of 32,385 47 births, the third largest in the region. Below is a death and birth rate statistics.

Fig.24: Crude death rate in the philippines

44

National Epidemiology Center, Field Health Report Service Information System, page16, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf> 45 National Epidemiology Center, Field Health Report Service Information System, page25, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf> 46 National Epidemiology Center, Field Health Report Service Information System, page29, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf>

Page | 86


Fig.25: Crude birth rate in the Philippines

In the first factor considerations, one of the most important to consider is the question, â&#x20AC;&#x153;Is there a need for the product in the market?â&#x20AC;? HealthLink is a quick service, affordable clinic specializing on its x-ray technology on its entry in the industry, thus HealthLink will address respiratory diseases like pneumonia and tuberculosis. In the Philippines, pneumonia is the most leading cause, bronchitis as the third, and TB respiratory as the sixth leading cause of sickness as for the reported cases. In the chosen region, pneumonia is the second leading cause, bronchitis as the fifth, and TB respiratory as the sixth leading cause 48. The follow-up question that one needs to consider concerns about the available health centers in the area. Region 4a has a total number of 253 local government unit workers which 47 of it is in Rizal 49. It also has 437 total local government unit nurses in the region with 50 in Rizal; a total of 1,787 local government unit midwives in the region with 195 in Rizal; and a total of 128 local government

48National Epidemiology Center, Field Health Report Service Information System, page 150, accessed: November 20,2009 <http://www.doh.gov.ph/chd12/images/downloads/fhsis/Annual_Rep07.pdf> 49 National Epidemiology Center, Field Health Report Service Information System, page 142, accessed: November 20,2009 <http://www.doh.gov.ph/chd12/images/downloads/fhsis/Annual_Rep07.pdf>

Page | 87


unit medical technicians with only 15 of them in Rizal 50. It is to be noted that Rizal province in region 4a has the lowest number of nurses, midwives, and medical technicians, thus a need to be addressed.

Fig.26: Region IV-A leading causes of disease

HealthLink will be establishing its quick service clinic in urban areas outside of Metro Manila because from observation alone, the number of hospitals and health care centers or clinics of Metro Manila are for the urban dwellers. With the chosen region and province, HealthLink has selected three major possible options where the clinic will be placed for its first year of operations â&#x20AC;&#x201C; 1) Amity Ville Subdivision, Tagumpay St., Barangay San Jose, 2) 3/F BML Building 423, del Pilar St., San Rafael, and 3) #51 P. Rodriguez St., San Rafael. All of which in are in Rodriguez, which is formerly known as Montalban. Using the factor rating method, below is a detailed comparative table that discusses which among the options is the best to choose for the HealthLinkâ&#x20AC;&#x2122;s location in quantitative terms:

50

Ibid

Page | 88


Scores (out of 100) Location Location Location 1 2 3

Weighted Scores L1 L2 L3

Crtitical Success Factors (CSF)

Weight

Near malls and other establishments such as church, covered courts (urban setting), busy landscape with many people passing Price Accessible to target market either by walking or transportation

0.15

90

70

60

13.5

10.5

9

0.15 0.20

50 90

70 70

90 50

7.5 18

10.5 14

13.5 10

0.15

90

90

90

13.5

13.5

13.5

0.10

90

70

50

9

7

5

0.10

50

70

90

5

7

9

0.15

90

70

70

13.5

10.5

10.5

80

73

70.5

Available utilities (water, electricity, etc.) Availability of Internet Service Providers within the area and telephone lines Specifications (land area) Support of local government units and the community Totals

1 Table15: Factor rating for HealthLink Clinic

Legend: Location 1 – Amity Ville Subdivision Location 2 – BML Building 423 Location 3 – P. Rodriguez Rating – out of 100%

Page | 89


Based from the factor rating analysis, the location to best place HealthLink will be location1 or in Amity Ville Subdivision. Firstly, because it is located in a busy street where most people flock; also, it has a close proximity to Tagumpay National Elementary Grade School and High School, Ynares multipurpose covered courts, and the Iglesia ni Christo church. Further, the street is not located in alleys, but on the main road, thus passengers of public transportation and private vehicles will be able to see HealthLink.

Fig.27: Rent space in Amity Ville subdivision

Fig.29: Covered Court

Fig.28 Iglesia ni Cristo

Fig.30: Busy street

Page | 90


Fig.31: Other establishments

Fig.32: P. Rodriguez Street location option

Despite having bigger locations and lower prices – 15,000pesos/month for 400sqm lot area and 20,000pesos/month for 200sqm lot area – for the P. Rodriguez and BML, respectively, the location in Amity Ville Subdivision is far better, even though it costs 20,000/month for only 123sqm, for its accessibility to HealthLink’s target market, since location1 and location2 are approximately near the rural areas already. Further, the support of the local government unit in the Barangay is stronger, as compared to the other two locations, based on current programs employed. As an example, Barangay San Jose holds Silid Aralan, which is a socially-oriented institution that provides financially-challenged children an opportunity and access to education,

Page | 91


where the local government unit involves community building through constant communication with the parents of the children, as well as, partnerships for various activities. They also employ laws that would require the community to either give donations, in cash or in kind, or community involvement itself to help sustain the operations of Silid Aralan.

2. Corporate office Location Planning Aside from the main location of the clinic, HealthLink will also be renting an office space to accommodate the board of directors, so they can have a place for their regular meetings. Further, the office space will be holding different rooms or cubicles for the varied functions of the management – marketing, finance, medical, and information technology, among others. HealthLink plans to place the office in Quezon City, as it would be more attractive, convenient and appropriate to entertain potential business partners and matters here, given the city’s commerce nature in relation to the office’s main purpose. Further, this will house a technical innovation room for our technician employees to assist in their maintenance responsibilities and for the technology and information department to aid in their innovation of HealthLink’s unique package software. With this, HealthLink has identified three major office locations – Visayas Ave., Del Monte and West Ave. Below is another comparative chart.

Page | 92


Scores (out of 100) Location Location Location3 1 2

L1

Weighted Scores L2 L3

Crtitical Success Factors (CSF)

Weight

Accessible to the HealthClinic site at Bgy. San Jose, Rodriguez Price Available utilities (water, electricity, etc.) Availability of Internet Service Providers within the area and telephone lines Specifications (land area) Totals

0.20

90

70

50

18

14

10

0.20 0.20

90 90

60 90

60 90

14 18

12 18

12 18

0.20

90

90

90

18

18

18

0.20

70

80

90

14

16

18

78

76

1 82 Table16: Factor rating for HealthLink corporate office

Legend: Location 1 – Visayas Ave., T.Sora, Quezon City (53sqm) Location 2 – 209-211 Del Monte, near corner Matutum Street (110sqm) Location 3 – 1140 West Ave. (100sqm)Rating – out of 100%

Based from the table, the Visayas Ave. location is the best option to choose for the office, despite it having smaller space (53sqm), as compared to Del Monte with 110sqm and West Ave. with 100sqm. Firstly, because of its accessibility to Rodriguez via Quezon Circle and Commonwealth direction through car or taxi, as compared to the other locations that takes longer routes. Also, it is more affordable given the price of 20,000/month, negotiable up to 15,000/month, as compared to Del Monte with 23,540/month and West Ave. with 25,000/month.

Page | 93


Fig.33: Chosen office location in Visayas Ave.

Fig.35: External faรงade1

Fig.37: External faรงade2

Fig.34: Internal faรงade1

Fig.36: Internal facade2

Fig.38: Internal faรงade in Del Monte

Page | 94


Fig.39: External faรงade in Del Monte

Fig.40: Externals of West Ave. location

Fig.41: Side-view of externals in West Ave

Page | 95


E. Facility Layout 1. Clinic Facility Layout

Fig.42: Blueprint of HealhLink San Jose,Rodriguez branch

The first branch of HealthLink has an area of 123sq meters. It will have a reception and payment area, a nurse station, two consultation rooms, a basic medical laboratory, and a lounge for the staff. The blueprints of the clinic are as follows:

HealthLink will be employing a process-oriented lay-out, simply because the business is service-oriented. There are two possibilities of patient flows in HealthLinkâ&#x20AC;&#x2122;s quick service clinic. The red arrow describes a patient that is either already a member (someone who availed of HealthLinkâ&#x20AC;&#x2122;s package service) or a new walk-in patient. The reception area will be the holding section of walk-ins or new patients while patients with appointments can immediately proceed Page | 96


to the holding area outside the doctor’s consultation office. The patient will then proceed to the nurse station where his measurements (blood pressure, weight, height, etc.) will be taken. The patient can now go to the doctor’s office for consultation. If the patient is advised to have a laboratory exam, he goes there then a print-out copy of his exam will be given to him. The patient can go back to the doctor’s consultation room and payment would be back at the reception area.

The blue arrows on the other hand describe a member patient who already has an appointment with the doctor or the laboratory. The patient will swipe his membership card to the membership card sensor. He will then proceed to the holding area outside the doctor’s consultation office. The patient will do this scheduled appointment then payment will be done at the reception area.

Fig.43: Process Oriented Layout

Page | 97


2. Corporate Facility Layout

Fig.44: Blueprint of corporate office

Aside from the facility layout, below is the corporate office lay-out, which is 53sqm in area. Here, the lay-out is divided into main component rooms that will be used regularly to maximize the limited office space. Upon entering, the guest or employee will see the reception room, where he or she can wait or relax in the couches. Further, there are also two executive rooms, one for the chief executive officer and the other for the board of directors, who would like to meet a client or business partner personally. Only two rooms were provided, since the other directors are not expected to be in the office the whole day, given their flexi-time schedule.

Aside from that, there is also a conference room for the regular management team meetings, toilets and a management cubicle area, which are furnished with computers and desks for any of the directors to use. In addition, there is the technical innovation room for the

Page | 98


technology and information department, where they can explore their creative abilities to formulate new innovations to help sustain the operations of the business. Given HealthLink’s unique software package for medical utilities – similar to Adobe Suite which has Photoshop, InDesign, etc. – the technology and information team can innovate in terms of adding new programs for the software such as an application program for a plug-in ultrasound, or for a vital signs and heart-rate monitoring system through a mobile patch device.

HealthLink envisions its employees to be creative as possible, to provide a better line-up of services in the most convenient and cost-efficient way as much as possible. However, innovation will be limited to the improvement of the software, or other related digital forms that can be included into the integrated package suite such as website applications. This room will also be used as a reference for technical maintenance of the clinic’s equipments to observe any malfunction or deterioration that may happen in the future.

F. Design of Work Systems 1. Key Positions The management team comprises owners/ directors and other key management positions a. Board of Directors -Chief Executive Officer (CEO)  The Chief Executive Officer will be the one overseeing the overall operations of the company. He will be the directions, planning and developing the strategies and implementing these accordingly towards the company’s objectives and goals while making sure that each endeavor HealthLink takes is in line with its Vision-Mission. He will also be the one dealing with mergers and sealing Page | 99


partnerships, approving documents, and setting up regular meetings with the other board members for updates and brainstorming. He is responsible for setting a good working environment and establishing a strong, honest and cooperative relationship with all the personnel, partners and customers of the company. He should be a management graduate with at least 4 years of experience in managing any reputable company, have a charismatic personality and excellent leadership skills.

-Chief Medical Officer (CMO)  The Chief Medical Officer will be the principal medical adviser and head of the medical staff of the company. He has the responsibility of recruiting and screening the medical staff as well as training health workers. He will be the one developing and coordinating health programs and handle medical documentations. In addition, he will be keeping the company updated with the latest development and trends in the medical industry. He will be directing and supporting medical management decisions that will help maximize the benefits for customers and support the company’s objectives. He will also be available for consultations in the clinic for specific days. He should be a licensed doctor with a medical degree specializing on respiratory and pulmonary illnesses. He should also have at least 3 years of physician leadership in a health organization.

-Chief Financial Officer (CFO)  The Chief Financial Officer will be the one managing the cash inflows and outflows of the company and monitor its use of resources within the company’s budget. He is responsible for the financial planning, analysis and forecasting Page | 100


of the figures, managing associated risks and supervising the investment of funds. He will also help in finding ways to increase capital in order to support the company’s plans for expansion. He should be a certified accountant and have at least 3 years of work experience as an accountant in at least a medium-scale company.

-Chief Operating Officer (COO)  The Chief Operating Officer will be the one to handle the daily operations of the business. He will be the one managing the logistics and maintaining the quality of the products and services and ensure that these are being met with high quality standards. In addition, he will also be the one responsible for hiring, training and managing all the personnel of the company in accordance with human resource policies and procedures to current laws and regulations. He should be a business graduate and have knowledge in the field of operations and management, basic human resource management and project management. He should be a multitasker with good leadership skills.

-Chief Marketing and Sales Officer (CMSO)  The Chief Marketing and Sales Officer will be responsible for the promotions and communications of the company. He will be ensuring that that business will have a strong and positive image to the public and to its stakeholders. He is also responsible for doing updated observation and research on the target market and market trends. He will also be the one setting competitive prices for the services and handling public relations/public affairs with the media, related partner companies and other people relevant to the company’s operations. He should be a Page | 101


business or marketing graduate with sufficient knowledge on at least Adobe Photoshop and Indesign. He should be creative, original, and have good oral and written communication skills and a pleasing personality.

-Chief Technology and Information Officer (CTIO) ď&#x192;  The Chief Technological and Information Officer will be handling the technological, scientific and research and development aspect of the company. He will be managing the technology infrastructure, information flow and technical decisions of the company. He is also responsible for updating the company with the latest software developments, information technology solutions and training the staff with technical expertise. He should be a graduate of engineering, computer science or any courses related to information systems. He should have at least 3 years work experience in a similar field.

b. Management -Clinical Manager ď&#x192;  The Clinical Manager will be the one handling the operations of the clinic from the accounting, operations and staff supervision. He will be reporting directly to the Chief Operating Officeron a weekly basis for updates. He acts as a liaison between the staff and to the board of directors. He should be a business graduate who has at least 2 years of work experience as a manager. He should be responsible, flexible, possess good leadership qualities, and have good time management skills.

Page | 102


-Information Technology Assistant ď&#x192;  The information technology assistant will be assisting the Chief Technology and Information Officer with handling technical issues. He will also be involved in developing softwares, updating them, as well as maintaining the hardwares that are being used for each of the clinic branch. He should be a graduate of computer engineering, computer science or of the same field. He should have at least 2 years experience in desktop support and facilities management.

-Information Analyst ď&#x192;  The information analyst will be the one maintaining and evaluating the data that are being gathered in the electronic patient database. He will analyze them and submit the reports to the board of directors. He should be a management information system graduate and have knowledge and experience handling data management. He should have good logic and comprehension skills.

-Accountant ď&#x192;  The accountant will be managing the sales and financials of the clinic. He will be monitoring closely the administrative expenses of the clinic as well as the revenues. He will also be the one responsible for giving out the compensations to the staff. He will report directly to the Chief Financial officer. He should be an accounting graduate with at least 2 years of work experience as an accountant or treasury officer. He should have at least basic knowledge on risk management and inventory management.

Page | 103


c. Clinic Personnel/Staff The Staff are the employees who work in HealthLink clinics. They are the frontliners of HealthLink. -Internal Medicine Doctors specializing in Respiratory Diseases  The physicians are specialist in dealing with Respiratory Diseases. They provide diagnosis and consultations with regards to the related illnesses. They have the permission to give out prescriptions and refer the patients to other doctors if necessary.

-Nurse  The nurse will be responsible for administering physical examinations to the patients and handling their health records. She will be assisting the doctor if ever there is a need. She should be able to pass the nursing board exam and have at least half a year related experience or training in basic occupational health course.

-Medical Technologist  The medical technologist is responsible for operating laboratory tests and processing them for results. He will also operate the x-ray machines and do the readings and final reports. He should be able to have a bachelor degree in medical technology and have at least 2 years of work experience.

-Receptionist  The receptionist will be the one greeting the patients and handling the payments. She will be the one receiving and making calls, noting down appointments and updating patients on new promotions/services of the clinic. She should be a

Page | 104


business management or marketing graduate with a very pleasing personality. She should be detail-oriented and have good mathematics skills.

d. Health Workers Health Workers are those who conduct â&#x20AC;&#x153;Usapang Kalusugan,â&#x20AC;? focus group forums on health and have the option of selling membership cards for a certain commission. They are not part of the organizational chart as they are not officially employed by HealthLink. They are from the indigent pool of patients referred to HealthLink by public health centers such as Kasiglahan Infirmary in accordance to the agreement HealthLink has with the government regarding free services to those in need in exchange for local business tax exemption. A certificate of approval from the CMO is required for them to officially represent HealthLink.

Fig.45: Management Organizational Chart

Page | 105


2. Compensation of Key Management a. Board of Directors Position

Monthly Salary

Non-Monetary Benefits Premium Card membership

Bonus Scheme

Chief Executive Officer Performance-based Chief Financial Officer management Chief Operating Officer compensation: when Chief Marketing & Sales P15,000 Maximum of 4 company-wide target Officer Classic Card is achieved percent Chief Technology & membership cards increase bonus will Information Officer for direct family apply relatives Chief Medical Officer Table17: Compensation plan for the Board of Directors b. Management Position Clinic Manager Information Technology Assistant Information Analyst

Accountant

Monthly Salary P10,000

Non-Monetary Benefits

Premium Card membership P8,000

Maximum of 2 Classic Card membership for direct family relatives

Bonus Scheme

Performance-based management compensation: when branch target is achieved percent increase bonus will apply or additional membership cards will be issued

Table18: Compensation plan for the management

Page | 106


c. Clinic Personnel/Staff Monthly Salary

Position Physician

Non-Monetary Benefits

P10,000

P7,000

Premium Card membership

P6,000

Classic Card

Nurse Medical Technologist Receptionist

Bonus Scheme Performance-based management compensation: when branch target is achieved percent increase bonus will apply or additional membership cards will be issued

Table19: Compensation plan for the clinic personnel/staff

The Figures were based on the minimum average salary indicated at Salary Report, a segment on JobStreet.com. The site features average salary ranges for various jobs taken from samples of real positions. d. Health Workers Position

Health Worker

Monthly Salary

Non-Monetary Bonus Scheme Benefits Free medical services upon 20% sales commission NA referral of public upon selling membership health centers or cards social services Table20: Compensation plan for the health workers

Page | 107


3. Staffing and Recruitment Plans To minimize costs, not all positions will be filled at once. In the first two years when there will only one clinic, the Board of Directors will function as the management body as well. These positions will be primarily occupied by the founders of HealthLink. Only on the third year will the positions for Clinical Manager, Information Technology Assistant and Information Analyst be open to replace the managerial functions of the Board of Directors in San Jose, Rodriguez, while the Board focuses their attention in the second clinic in San Juan, Taytay . The distribution of roles for starting clinics is indicated in the table below. Positions Chief Executive Officer Chief Medical Officer Chief Financial Officer Chief Operating Officer Chief Marketing & Sales Officer Chief Technology & Information Officer

Management Roles Clinical Manager Accountant

Information Technology Assistant Information Analyst Table21: Year 1 Executive board management roles

HealthLink clinics with an average size of 120 square meters will have two doctors, a nurse, a medical technician, a receptionist, and a maintenance employee. The group of medical professionals will be drawn from partner medical institutions and former government healthcare employees.

Many students in Rodriguez go to Manila to pursue medical courses in schools such as the Far Eastern University and University of Sto. Tomas. After getting their degree, they come back to Rodriguez for practice. These schools may be tapped to secure a large pool of applicants. Also, the Chief Medical Officer may coordinate with the schoolsâ&#x20AC;&#x2122; administration to Page | 108


create a program wherein training for undergraduate medical and premedical students may be done in HealthLink clinics. They may take on roles such as assistant nurses and assistant physicians. Having assistants for the clinic staff may increase productivity in terms of the number of patients served. UPPGH may also be partnered with, as they are known for excellent service in Public Health.

Former government employees are also a good pool to consider. According to an interview conducted at Kasiglahan Infirmary. Both administrative and medical staff (except for the medical technologist) are replaced whenever the local government administration is changed. This is due to the politics in Rodriguez. These individuals are great candidates for HealthLink because they are used to serving the target market. In turn, the potential patients have also invested a certain amount of trust in them. Having them as staff will provide ease in the entry of HealthLink in the community. Another advantage is that they are used to providing good service with minimum compensation. It is then safe to conclude that their motivation is greatly non-monetary. Hence, securing them for long-term employment is more probable than doing the same for individuals with a background in the private sector.

Page | 109


Call for applications will be announced through government centers (ex. Barangay Hall, government-owned infirmary) and partner institutions (ex. PGH, FEU). After this, several procedures follow before formally hiring applicants. The complete process is illustrated in the diagram below.

Fig46: Recruitment procedures

Page | 110


4. Training Policies All clinic staff are required to undergo various training before officially taking on a position at HealthLink and while serving within the timeframe of their contract. Several courses are available per training. Courses to be taken are dependent on the requirements of each position as indicated in the grey tables below. Failure to comply with the required output of the training will prohibit an individual from proceeding with his/her application or put his/her employment on hold. All Clinic Managers are to ensure that each personnel fulfill the required training for his/her position. The Chief Operating Officer in turn, makes sure all Clinic Managers have undergone the necessary training. The table below indicates the training applicable to the different positions.

Position Clinic Manager Information Technology Assistant Information Analyst Accountant Doctor Nurse Medical Technologist Receptionist Maintenance

Equipment Usage X

Information Systems X

X

X

X X X X X X X X X Table22: Training policies 1

Service

Operations

X

X X X

X X X X

X X X X

a. Equipment Usage Training This gives primary focus on the unique equipment of HealthLink. It is necessary to ensure accuracy and efficiency in handling the instruments for the safety of the patients and the work force. The Clinic Manager is also required to take this training, although at a more basic level, so that he/she can make better decisions regarding staffing that is related to the Page | 111


use of such equipment. This training will also give the manager a better grasp and appreciation of the operations. Training will be held whenever there is a new applicant to the specified positions and whenever a new technology is availed of by HealthLink. Position Clinic Manager Information Technology Assistant Medical Technologist

Functions

Safety

X

X

X

X

Operation

Internal Mechanics

X

X

X

X

X X Table23: Training Policies 2

b. Information Systems Training An information system is an integral part of the business. Without it, HealthLink will not function smoothly. Hence, every personnel is required to undergo this training. The intensity of the training is dependent on the degree to which an employeeâ&#x20AC;&#x2122;s job is involved with electronic information. This is incorporated in the on-the-job training of each applicant. Mastery of the systems is a requisite to being hired. Position Clinic Manager Information Technology Assistant Information Analyst Accountant Doctor Nurse Medical Technologist Receptionist Maintenance

Software Operation X

Database Management X

Data Analysis X

Software Maintenance

X

X

X

X

X X X X

X X X X

X X X

X

X

X

X X X Table24: Training policies 3

X X

Page | 112


c. Service Training The Service Training ensures the customers receive consistent high-quality service. It also familiarizes the staff with the various services the company offers that they may easily recommend to the patients. For a better transition in staffing and a more hands-on way of learning, a mentorship system will be employed for job applicants. Training with their peer will allow them to see how each task should be properly done. It also promotes a sense of pride for the trainers because it puts greater value in their skill and knowledge. And lastly, it eases in the applicant in the working environment, creating a more harmonious interaction among all personnel. Position Clinic Manager Doctor Nurse Medical Technologist Receptionist

Customer Relations X X X X X X X X X X Table25: Training policies 4 Job-Specific Tasks

HealthLink Services X X X X X

d. Operations Training Training on operations is necessary to have a good working relationship among various personnel in the clinic. It will provide ease for transactions that require interaction. It also aims to manage the speed by which individual tasks are accomplished in relation to the speed by which the entire clinic efficiently operates in. This training involves a mock operation that simulates various scenarios that may be encountered by the clinic. A new branch will not be permitted to operate without having an operations training first. Succeeding trainings during regular operation will be in the form of timed

Page | 113


observations. The Clinic Manager will visit the clinic and time the various transactions. He/she may or may not announce such observations. Feedback will then be given to the staff either individually or as a group. Additional training will be conducted if the Chief Operations Officer puts new operation systems in place. In addition to training employees, HealthLink will also train indigent individuals as part of its direct marketing strategy and partnership agreement with the government concerning tax exemption. These individuals who have availed of HealthLink services for free with a clearance from social services or a referral from public medical facilities will be trained as health workers under the CMO. This kind of training will take place once a month.

5. Human Resources Management Policies Some examples of human resources management policies in the Philippines are the following: a. Philippine Labor Code of 1976 It is a comprehensive law which consolidates labor and social laws that gives protection to labor, promote employment and human resources development and insuring industrial peace based on social justice. 51 The law covers everything from making a leave, handling terminations, minimum wage down to unionization. For example, it states that for regular employment, the employer cannot end the services of an employee without just cause. For someone who was unjustly dismissed, he shall be entitled to reinstatement without loss of

51"LABOR

CODE OF THE PHILIPPINES [FULL TEXT] - PHILIPPINE LABOR CIRCULAR ON-LINE." THE LAW FIRM OF CHAN ROBLES & ASSOCIATES. N.p., n.d. Web. 10 Jan. 2010. <http://www.chanrobles.com/legal4labor6.htm>.

Page | 114


seniority rights and other privileges from the time his compensation was withheld from him up to the time of his actual reinstatement. 52

b. 13th Month Pay Law All employers, except government owned corporations, employers of household helpers and those paid on commission, should pay their rank and file employees a 13th month pay on or before December 24 each year, provided that they have worked for a minimum of one month during the year. 53 The 13th month pay is in essence a form of monetary assistance which makes up 1/12 of the employeeâ&#x20AC;&#x2122;s basic salary earned for the year and the employees can ask for it if they are entitled to it.

c. Minimum Wage Rate Minimum wages should consider factors affecting the region such as socio-economic conditions which affects the cost of living of the people in the area, business environment for the creation and preservation of jobs, capacity to pay by the majority of employers and the comparability of wages that will permit sustainable viability and competitiveness on the business and industry. 54 In the private sector of Region IV-A, minimum wage workers and employees shall be receiving a basic wage increase in the following amount:

Ibid. Questions | 13th Month Pay Law & Labor Code in the Philippines." Jobs & Job in the Philippines : Philippine Job & Manila Jobs | JobsDB. N.p., n.d. Web. 10 Jan. 2010. <http://www.jobsdb.com.ph/PH/EN/V6HTML/Home/inside-pages/CC_JobQuestions/JobQuestions.htm>. 54 "REGION IV-A - CALABARZON - WAGE ORDER NO. IVA-12 - PHILIPPINE LABOR CIRCULAR ON-LINE CHAN ROBLES VIRTUAL LAW LIBRARY." THE LAW FIRM OF CHAN ROBLES & ASSOCIATES. N.p., n.d. Web. 10 Jan. 2010. <http://www.chanrobles.com/region4a.wageorderno-iva-12.html>. 52

53"Job

Page | 115


1) Growth Corridor Area ď&#x192; P 10.00 - 13.00 2) Emerging Growth Area ď&#x192;  P 8.00 - 9.00 3) Resource Based Area ď&#x192;  P 6.00 The area of Rodriguez, Rizal is classified under growth corridor area and the workforce there shall receive the following amount of minimum wage: NonAgriculture P 277.00

Plantation

Non-Plantation

Cottage

P 252.00 232.00 P 240.00 Table26: Various wage rate in different industries

Employing not more than 10 workers P 172.00

This should apply for normal working hours which do not exceed more than 8 hours a day. However, for the cases of contractors such as security, janitorial and construction, the prescribed increases in the wage rates shall depend on the principals or clients of the service contractor. For failure to comply with the regulation, the contractors shall be jointly and severally liable with the principals or clients. 55 In cases where in the business has other establishments in different parts of the region or where the headquarters in situated outside the region, the applicable rate depends on the particular city/municipality where the employee is based. For transferrals from a high rate area to a lower rate area, the higher rate shall be applied.

55

Ibid.

Page | 116


G. Supply Chain Management HealthLink has two kinds of medical suppliers, one for the basic lab equipment and another for the telemedicine equipment. Basic lab equipment will be purchased from Bambang, Manila, a hub of medical supplies and equipment well known for low prices with convenient payment schemes. Health Expert, one of Brgy. San Juan’s noted laboratories, purchase their equipment from the area. HealthLink will be transacting with CJ Medical Supply, situated in 1554B Bambang St., Sta. Cruz, Manila. Among three potential suppliers in the area, CJ Medical Supplies provide a wider range of product selection that is specific to laboratory requirements. The other two companies, Floren Hospital Equipment and Medical Supplies, and Medical Center Trading Corporation offer general hospital equipment.56 It is best to conduct business with one supplier at a time so that greater discount can be availed of.

The telemedicine equipment demands a different setup. Since these kinds of apparatuses are not available in the commercial market, it has to be custom-made. HealthLink will outsource the manufacturing of such equipment as the plug-in x-ray from Himex Corporation. Himex started business in 1990, lead by engineering graduate Mr. Teruhiro Ohno. Its clients include the Philippine General Hospital, Philippine Children’s Medical Center, and the Department of Health.57 The head office is based in Unit 603-604, Prestige Tower Condo, Emerald Avenue, Ortigas Center, Pasig City. 58

“Medical Equipment.” EYP.ph. Directories Philippines Corporation. Web. 11 Jan. 2010 “Company Overview.” eHimex.com. Himex Corporation. Web. 11 Jan. 2010 58 “Head Office.” eHimex.com. Himex Corporation. Web. 11 Jan. 2010 56 57

Page | 117


Another important component of HealthLink’s services is the Membership Card Sensor. Since it uses the common magnetic stripe card technology, units will simply be bought by each clinic online. HP USB Magnetic Card Stripe Reader can be purchased at keezo.com for $60.82, approximately P2,700, inclusive of shipping. The site was rated 4 out of 5 by 257 sellers. 59 The manufacturing of the actual membership cards will be outsourced from Zhuhai Dari Giftware Company Limited, a China-based manufacturing company located in the province of Guangdong. It has a productivity rate of 30 million cards per month. Shipping is included in every business transaction.

Fig.47: Magnetic stripe card reader

H. Inventory Management In running HealthLink, the clinic will not only offer quality services but quality equipment and a clean environment thus ensuring the customers that HealthLink is a safe and clean avenue for health care. With this in mind, HealthLink has asked for the services of an information technology assistant which will be outsourced and an overall maintenance person to handle the various maintenance tasks.

59

“HP USB Magnetic Stripe Card Reader with Brackets.” Google.com. Google Products. Web. 11 Jan. 2010

Page | 118


The IT assistant is there to ensure that the computers and diagnosis machines are in perfect working condition. The maintenance person will be in charge of keeping the clinic clean and spotless as well as act as a runner for the clinic.

The maintenance person will be required to sweep and mop the floor every night after clinic hours. This will ensure that the clinic will be always clean. The clinic will have a general cleaning day every week. The IT assistant will handle the maintenance of the computers as well as the diagnostic machines. The IT assistant will be asked to come to the clinic twice a month in order to do a bi-monthly maintenance check up by the It assistant.

A more traditional view of "Inventory" would involve the materials that flow through the firm into different stages of completeness ranging from raw goods inventory, to work-inprogress inventory, and to finished goods inventory. This definition would be more applicable to a firm producing goods; and because Health Link is a service oriented firm it deals more with the state of the people as they avail of the services offered by Health Link.

1. Raw Materials Inventory: Patrons demanding service from Health Link They are the people who enter the Health Link reception area looking for medical solutions for their needs. This visit might arise from several causes, some of the reasons that Health Link expect would be because of current sickness, need for lab testing for whatever reason, fear of letting symptoms to develop into serious sickness and regular checkups.

Page | 119


2. Work-In-Progress Inventory: Patrons in the process of either diagnosis or lab testing Depending on the specific needs of the patrons, they will be taken to either the doctor or the lab. In both cases, the patron will be subject to multiple computer-aided testing and their data will be recorded on the Health Link database where it could be easily retrieved (more so if the patron avails of the membership card). Through this process, the patrons will be able to get an assessment of their physical condition and know whether or not to take any corrective actions.

3. Finished-Goods-Inventory -> Patrons done with the tests and is going to retrieve data - The data will all be stored in the database ready to be printed before exiting the Health Link venue and for further information the patrons can contact Health Link for any additional help. The information will also be available online accessible through the membership card, but because of the target market it would be unlikely that this feature will be used extensively. Lab Category

Medical Equipment

Hematology

Description

Qty.

This machine has a throughput of 60 samples per hour. It is fully automated with an LCD screen with a thermal printer.

1

This section processes urine samples, stool samples and other body fluids. Equipped with automated analyzers and Laminar flow cabinets. This enables fast processing of results as well as a safe and sanitary work area. 62

1

Automated hematology analyzer 60 Clinical Microscopy

60

â&#x20AC;&#x153;Auto Hematology Analyzer.â&#x20AC;? Yunfan Medical Equipment Co. Ltd. Web. 14 January 2010 ,<http://cqyunfan.en.alibaba.com/product/268409049-209319760/auto_hematology_analyzer.html> 62 Ibid

Page | 120


Compound light microscope

24-Hour Urine Test

61

Urine reagent strips are used to detect levels of specific parameters like pH, glucose, protein, ketone, bilirubin, blood, nitrite, urobilinogen, specific gravity, and leukocytes. 64

100

This test kit is a rapid, direct binding test for the visual detection of hepatitis B surface antigen (HBsAg) in serum. It is used as an aid in the diagnosis of hepatitis B infection. 66

50

This used to measure the chemical components of your blood plasma. The plasma contains water, glucose, proteins, lipids and minerals such as calcium. 68

1

10 Parameter urine reagent strips 63 Hepatitis

Hepatitis A test kit (ELISA) chemicals 65 Blood Chemistry

Vital Selectra blood chemistry analyzer 67

61

“Lab Departments.”Hi-Precision Diagnostics. Web. January 14, 2010, < http://www.hiprecision.com.ph/services4803.html?item_id=1769> 63 “Urine Reagent Strips.” Lab Essentials. Web. January 10, 2010 <http://www.labessentials.com/Urine_Reagent_Strips.htm> 64 Ibid. 65 “Hepatitis A lgm Elisa test kit”. Beijing Keiwei Clinical Diagnostics Co. Ltd. Web. January 14, 2010 <http://bjkewei.en.alibaba.com/product/263435362-200457188/Hepatitis_A_IgM_elisa_test_kit.html> 66 “Hepatitis (HBsAg) rapid serum test strip." Sulit.com.ph. Web. January 10, 2010. <http://www.sulit.com.ph/index.php/view+classifieds/id/1470723/HEPATITIS+(HBsAg)+rapid+serum+test+strip> 67 “Products and Services.” Paratron Services. Web. January 12, 2010 <http://paratronindustries.com/products_services.php> 68 “What is a blood Chemistry Test” e.How.com. Web. January 20, 2010 <http://www.ehow.com/about_5386952_blood-chemistry-test.html>

Page | 121


Enzymes

This test analyzes the energy patterns of carboxypeptidase, enterokinase, lactase, lipase, lysozyme, maltase, pepsinogen, pepsin, peptidase, amylase, sucrase, trypsin, etc. 70

50

IgG/IgM ELISA Test (Enzyme-Linked Immuno-sorbent Assay) 69 Electrolytes

Analyzes sodium, potassium, chloride, magnesium, inorganic phosphorus, total iron, TIBC + TOTAL iron, calcium, ionized calcium

1

A lipid profile test is a collection of tests carried out in order to assess the levels of different types of cholesterols (like triglycerides, LDL-Cholesterol and HDLCholesterol) in the blood stream. 73

1 case

Used to measured in LFTs include gammaglutamyl transferase (GGT); alanine aminotransferase (ALT or SGPT); aspartate aminotransferase (AST or SGOT); and alkaline phosphatase (ALP), and prothrombin time (PT). 75

20

Electrolyte analyzer 71 Chem Packages

CHOL-10-991 Lipid Profile Cassettes 72

Home Liver Function Test 74

69

“Urine Reagent Strips.” Lab Essentials. Web. January 10, 2010 <http://www.labessentials.com/Urine_Reagent_Strips.htm> 70 “Digestives Enzymes test kit." Life Work Estiantial.com. Web. <Http://www.lifeworkpotential.com/acatalog/Digestive_Enzymes_Test_Kit.html> 71 “Electrolyte Analyzer.” Yunfan Medical Equipment Co. Ltd. Web. 14 January 2010 ,<http://cqyunfan.en.alibaba.com/product/268409049-209319760/electrolyte_analyzer.html> 72 http://www.lifeworkpotential.com/acatalog/Digestive_Enzymes_Test_Kit.html 73 http://www.cholesterol-doctor.com/advice/test/what-is-lipid-profile-test.html 74 http://www.amazon.co.uk/Home-Liver-Function-Test/dp/B002KLF6AG 75 http://www.answers.com/topic/liver-function-tests

Page | 122


Thyroid Test

A machine used to test for Hepatitis and Thyroid testing (20/box).

20

This test is for the diagnosis of tuberculosis and employs liparabinomannan (LAM) antigen bound to plastic combs. 78

1

Equipped with Blood Culture Analyzers and Bio Safety Cabinets, this section performs all bacteriologic and fungal tests in a controlled environment.

1

This machine is used to measure properties of light over a specific portion of the electromagnetic spectrum that identifies any bacteria in the test sample. 81

1

This test does a comprehensive evaluation of overall hormone balance or imbalance, and indicates thyroid and adrenal function and breast cancer profile.

20

Thyroid Test – ZRT Labs 76 Serology

Serological Test Centrifuge 77 Bacteriology

Autoclave/High Pressure Sterilizer 79

Spectrophotometer, Analyzer 80 Hormones

Hormone Profile II + PM Cortisol (6 Tests) 82 76

ttp://www.lifeworkpotential.com/acatalog/Digestive_Enzymes_Test_Kit.html Lab Departments.”Hi-Precision Diagnostics. Web. January 14, 2010, < http://www.hiprecision.com.ph/services4803.html?item_id=1769> 78 http://www.mossmanassociates.com/immunodiagnostics.htm 79 “Products and Services.” Paratron Services. Web. January 12, 2010 <http://paratronindustries.com/products_services.php> 80 Ibid. 81 Ibid 82 “Multi Drug test kits.” Drug Test Kit Shop. Web. February 10, 2010 <http://www.drugtestkitshop.com/> 77

Page | 123


This test does evaluation of hormone balance, imbalance and interrelationship of specific hormone levels as related to symptoms of menopause, andropause and adrenal function.

20

This test is a double antibody sandwich EIA for quantitative detection of Pro-GRPa new tumor marker of small cell lung cancer (SCLC). Used for diagnosis of SCLC.(96 tests)

5

Used for detecting any drug intake in the bloodstream by taking samples of the blood.86

50

To test whether the sample blood is HIV positive (+) or negative (-).

20

A 24 ounce bottle disinfectant spray will be used for the laboratory equipments to make sure that the instruments used are clean.

10

Hormone Profile III + AFT (8 Tests) 83 Tumor Markers

Tumor Marker test kit 84 Drug Test

Drug Test Kit 85 HIV Test

HIV test kit with titer (ELISA) 87 Others

Opti-cide Disinfectant spray 88

83

Ibid. “Tumor Marker Test”. Beijing Keiwei Clinical Diagnostics Co. Ltd. Web. January 14, 2010 <http://bjkewei.en.alibaba.com/product/263435362-200457188/Tumor_market_test.html> 85 “Multi Drug test kits.” Drug Test Kit Shop. Web. February 10, 2010 <http://www.drugtestkitshop.com/> 86 Ibid 87 “Hiv Test Kitt”. Beijing Keiwei Clinical Diagnostics Co. Ltd. Web. January 14, 2010 <http://bjkewei.en.alibaba.com/product/263435362-200457188/Hiv_test_kit.html> 88 Ibid. 84

Page | 124


This will be used by the medical technician and the interns when performing lab tests.

500

The syringe will be used to hold the needles when taking blood samples from the patient.

500

The needle that will be injected in the person’s skin to take blood samples.

500

Disposable gloves 89

Disposable Syringe 90

Disposable syringe needles 91 Used to get small samples and objects that are hard to get such as hair strands.

5

Used to cut objects specifically for medical purposes.

5

Forcep92

Precision scissors 93

89

“Disposable Laboratory Gloves”. Cole Parmer. Web. January 14, 2010. <http://www.coleparmer.com/products/safetyproducts/disposable-gloves.asp> 90 “Product Catalog.” Cole Parmer. Web. January 12, 2010. <http://www.coleparmer.com/catalog/product_index.asp?cls=54792> 91 Ibid. 92 Ibid. 93 Ibid.

Page | 125


Used for titration purposes such pH and to heat liquids.

20

Also used to hold liquids to be measured.

15

Used for the maintenance of the clinic to eliminate airborne particles such as dust, pollen, bacteria, and smoke and relieve dry skin, itchy eyes, and harmful static electricity. 97

2

This is used to measure the patient’s blood pressure.

2

Used to measure the temperature of the patient.

3

Erlenmeyer Flask 94

Beaker 95

Air cleaner and humidifier 96

Sphygmomanometer 98

Thermometers 99

94

Ibid. “Beaker” Nexusgamers. Web. January 10, 2010. <http://nexusgamers.co.uk/catalog/images/Glass%20Beaker.jpg> 96 “Product Catalog.” Cole Parmer. Web. January 12, 2010. <http://www.coleparmer.com/catalog/product_index.asp?cls=54792> 97 Ibid. 98 “Home.” Lab Essential. Web. January 12, 2010. < http://www.labessentials.com/home.htm> 99 Ibid. 95

Page | 126


Used to measure the height and weight of the patient.

1

Used to study samples of cells and other micro-organisms.

1

This used as a placeholder of samples to be tested in the microscope.

30

These tubes serve as containers for blood and other samples.

30

These bottles serve as containers for stool, and urine samples

50

This centrifuge has a capacity of 8 test tubes that is 8-15 ml in size; it can be used for blood, fecal, urine, and semen tests.

3

Weighing Scale 100

oscope 101

Micr

Glass slides 102

Test Tubes 103

Small plastic bottles 104

LV Scientific Ultra Centrifuge 105

100

Ibid. Ibid. 102 Ibid. 103 Ibid. 104 Ibid. 105 â&#x20AC;&#x153;C-3 Select Centrifuge.â&#x20AC;? Lab Essential. Web. January 12, 2010. < http://www.labessentials.com/centrifuge.htm> 101

Page | 127


This is used to preserve the blood samples for testing or donation and keep it wellventilated.

1

This test tube is specifically used for the LV Scientific ultra centrifuge.

20

Used for basic medication consisting of basic medicine, gauze and cotton among others.

15

Mini blood bank refrigerator 106

15ml Conical Centrifugal Test tube with cap 107

First aid kit 108 Table 27: Summary of major equipments

I. Maintenance In running HealthLink, the clinic will not only offer quality services but also quality equipment and a clean environment thus ensuring the customers that HealthLink is a safe and reliable avenue for health care. With this in mind, HealthLink has asked for the services of both an overall maintenance person to handle the various maintenance (housekeeping) tasks and an information technology assistant who will be based at the headquarters who visits for regular equipment maintenance and for breakdowns. The in-house maintenance person will handle the housekeeping of the whole clinic with standard tools used for cleaning. The maintenance person will be required to sweep, mop the

106

“Product Catalog.” Cole Parmer. Web. January 12, 2010. <http://www.coleparmer.com/catalog/product_index.asp?cls=54792> 107 Ibid. 108 “First Aid Kit.” David Report. Web. February 10, 2010 < http://davidreport.com/blog/wpcontent/uploads/2008/02/first_aid_kit.jpg>

Page | 128


floor and wipe the furniture every night after clinic hours. This will ensure that the clinic will be always clean and ready to use for the following day. The clinic will also have a general cleaning day every week for a more thorough. This maintenance person will have no hand in equipment maintenance, only the venue.

The IT assistant will ensure that the computers and diagnosis machines are in perfect working condition. He or she will be expected to report to the head office rather than to the individual Health Link locations, and is tasked to simply travel to the Health Link areas during the regular maintenance schedule or other technical needs. The IT assistant will be responsible for going to the clinic twice a month in order to do a bi-monthly maintenance check up on the equipment, both hardware and software. Because it is very inefficient for the IT assistant to continuously travel to areas, whenever the problems are minor then he or she acts as a troubleshooting guide contacted either through the phone or internet. HealthLink would employ a preventive strategy for maintaining their equipment because it would be more cost efficient for them to do so. Breakdowns in a year Estimated frequency of breakdowns 0 0.1 1 0.5 2 0.3 3 (or more) 0.1 Table26: Estimated frequency of breakdowns Key Assumptions: - Maintained equipment are expected to breakdown only once per year. - The breakdowns are serious enough to merit a personal visit to the Health Link area. - The IT assistant would be given P250 to go to the specified area. Page | 129


- Whether the equipment is maintained or not, the breakdowns are of the same severity. - The expected average fixing time of the breakdown would be 1 day, Health Link closed. - The number of people who would visit that day would be 10 (50:50 mix, 50% capacity). - Each of those 10 people have classic memberships which is P500/month; P6,000/year. - Of those 10 people who will not be serviced, 5 will take their business elsewhere and not go back to Health Link, thus being revenue lost.

Fig48: Expected Maintenance Cost With regular breakdown repair, Health Link would expect to lose 42,350 of revenue because of closing down while only losing P36,000 if they maintained their equipment; thus preventive maintenance would be the better choice. There is also great value in keeping the image of having very few breakdowns.

Page | 130


V. Financial Plan

Page | 131


A. Companyâ&#x20AC;&#x2122;s Financial Assumptions 1. Accounting Cycle HealthLinkâ&#x20AC;&#x2122;s financial period will be on a semi-annual basis from January 1, 2011 to June 30, 2011 for the first semester and July 1, 2011 to December 31, 2011 for the next semester. The accounting cycle will show the process of how the company manages its debit and credit flow of transactions and preparation of its financial statements at the end of the accounting period. Please refer to Appendix 1 for a more detailed explanation of each step in the accounting cycle.

Fig.49: Accounting cycle steps

Page | 132


2. Type of Business Organization HealthLink chooses to be a limited liability company (LLC) as a form of business organization. It is a type of business ownership that has no restriction on the type and number of owners, except that it must be formed or managed by at least two members. It has a mixture of the characteristics of a corporation and partnership structures. Owners are called members and they get the same tax benefits as partners in partnership and enjoy the limited liability benefits of a corporation. Business profits, losses and expenses are “passed through” to the members where they pay income taxes at their individual tax rates only and not at the business level. This gives the company the advantage of having less complicated taxation and avoiding double taxation but circumstances can favor a corporate tax structure. 109 Since an LCC exist as a separate entity, members cannot be held personally accountable by creditors for any debts and obligation liabilities the company has incurred. However, this rule does not apply to instances where there is a personal guarantee agreed upon to the repayment of debts, cases of fraud or misrepresentations and negligence in actions, which may cause harm and damages to a third party. 110 Please refer to Appendix 2 for a further description about LLC.

3. Initial Capital HealthLink will be initially investing a total of P2,541,413.50 for the business for the first year of operations. The breakdown of the capital is shown below:

109

“Limited Liability Company 101.” About.com: Small Business Information. Web. January 8, 2010. <http://sbinformation.about.com/cs/ownership1/a/LLC.htm> 110 “Limited Liability Company.” Lawyers.com. Web. January 8, 2010. < http://business-law.lawyers.com/businessenterprises/Limited-Liability-Company.html>

Page | 133


HEALTHLINK Cash Other Current Assets Fixed Assets License Fee Patent Insurance Rent Promotions

1,000,000 332,939 936,309.50 7,000 16,010 100,000 20,000 20,203

TOTAL INVESTMENT 2,541,413.50 Fig.50: Summary of initial capital

HealthLink will be putting up its clinic in Barangay San Jose in Rodriguez, Rizal in the year 2011. Owners will put in a cash capital of P1,181,891 as initial investment as well as P40,000 worth of current assets, which includes medical supplies such as gauzes, cottons and liquids, as well as office supplies. In addition, the company will also be investing on fixed assets that are necessary for the operation of the clinic. Medical machines like the plugged-in X-ray, analyzers, etc. and equipments like microscopes, test tubes, etc. costs a total of P936,309.50. This includes the development of the integrated software that will be used which costs P500,000. Meanwhile, other things to consider for the initial investment includes spending on the licensing fee of the business which costs P7,000, insurance fee of P100,000, preliminary promotions worth P20,203, and the rent of the company for the year which costs a total of P240,000 (P20,000/month). All in all, the total sum of the companyâ&#x20AC;&#x2122;s initial investments costs P2, 541,413.50

Page | 134


4. Balance Sheet Assumptions Apart from the Income Statements, the following are the balance sheets of HealthLink to indicate the financial position of the company in terms of “resources it owns, the debt it owes, and the amount of the owner’s equity (investment in the business),” to put it simply. 111 Cash  This is basically the current cash on hand for each year, which are received from revenues earned. At the start of the year, initial capital and loans are included in the account.

Accounts Receivables  Accounts receivables are expected to be 1/12 or 8.33% of the total cash of HealthLink by the end of the year, this rate taken from the months of the year wherein conservatively if all membership accounts for the previous year owe HealthLink for the month of January of the coming year. This amounts to P45,271.46 by the end of the first year, 151,564.83 end of the second year and 199,286.00 for the third year most likely amount of accounts receivable. This phenomenon is assumed, because there is no tangible basis for assuming bad debt given that the people are given packages that are very much affordable even at minimum wage and HealthLink even offers service to the destitute with help from incentives from the government.

111

Accounting 15: Fundamentals of Accounting Workbook, Venus Ibarra, JGSOM

Page | 135


Membership Cards (Inventory)  This is the number of inventory cards produced and stocked, which is based on the demand forecast or number of people availing of the packages.

Health Digest (Inventory)  Same as the membership cards, this is also the number of produced magazines, which is part of the promotional strategies of HealthLink.

Medical Supplies (Inventory)  These are stocks of supplies for basic medication purposes such as gauze, cotton, Betadine, which are commonly found in first aid kits.

Retired Long Term Debt  This is the portion set aside in an account to pay for the long term debt of HealthLink to ensure that there are funds to cover the specific liability.

License  This is an intangible asset of the company required to setup the business.

Patent  Also an intangible asset to protect intellectual property rights of HealthLink’s service line-up, especially since product innovation will be employed.

Software Development and Modification  Since the core of the HealthLink’s service is software-based, half a million will be spent and set aside to innovate and develop new programs for the software. This will include research and electronic costs.

Page | 136


Computers  Computers will be an essential equipment to run HealthLink’s services, which will be used by the doctors, receptionist, etc. Most importantly, it will serve as the display screen for the X-Ray. There will be five computers for the clinic and six in the office.

Office Supplies and Equipment  These include the desks, chairs, air conditioners, printer and other new office assets. These are expected to be depreciated overtime using straightline depreciation.

Bed  As in any clinic, this will be used to lie or rest the patient down, when the doctor is doing the examination.

Scanners  This will be used to scan the membership cards of the patients to identify their personal information and the package that they acquired.

Medical Equipment  These include the lab equipment such as Abbot AxSYM system, Pharma Unicap, Microscope, Coulter JT Heme Analyzer, ASNR Gamma Counter, Plastic Containers, Weighing Scales, Spygmomamonitor, Test Tubes and Glass Slides. Similar to the office equipment, these are expected to be depreciated overtime.

Page | 137


5. Income Statement Assumptions Below are four income statements table of HealthLink, the first table is the summary of a 3 year forecasting while the next three tables are detailed income statements of years 2011, 2012, and 2013. Revenue Recognition ď&#x192;  Revenue is recognized when there is a purchase of HealthLink prepaid packages (classic at P50 monthly, premium at P100 monthly, and family at P180 monthly), patient walk-ins, and laboratory examinations services are rendered. At the first semester of the first year of the HealthLink, an assumption of 3% of the target market will avail the packages of HealthLink. That would be 2,807 patients out of the total 93,567 112 San Jose population. Of the 2,807 patients, an estimated 60% will procure the classic, 30%, will buy purchase the family package, and 10% will be that of premium plans. This 60-30-10 package breakdown assumption will be used for all semesters of the HealthLink. An estimate total of P1,500.00 is rendered from the walk-in and medical tests. Such assumption is made from a safe estimation of the 50% of Health Expertâ&#x20AC;&#x2122;s, a competitor, total earnings per day of P3000.00. For the second semester and succeeding semesters of HealthLink, there would be a rough average increase of 2.5% of the total captured market of the total population of San Jose, Rodriguez. This is due from the marketing efforts and brand awareness of the company. A decreasing demand of market share increase just shows that the first two semesters of the operations of HealthLink will aim for building its consumer base.

112

National Epidemiology Center, Field Health Report Service Information System, page10, accessed: November 20, 2009. <http://www.doh.gov.ph/chd12/images/downloads/thsis/Annual_Report07.pdf>

Page | 138


At the third year of Healthlink, a second branch will be established at the same region in Calabarzon (region4a) but it would be situated at baranggay San Juan, Binangonan, Rizal. Just like San Jose, San Juan has a rough population of 88,000 with the same health conditions with San Jose. The basis for revenue for the third year is still the same with the table below but year 1 of the table below is added because of the newly established second site. year 1 1 sem 2nd sem ST

% captured market of the total population % increase of the market share demand *total population = 93,567

3.00%

year 2 1 sem 2nd sem ST

year 3 1 sem 2nd sem ST

4.50%

6.30%

6.93%

7.62%

8.19%

50%

40%

20%

10%

7.50%

Table29: Summary of revenue assumptions

Cost of Services ď&#x192; The cost of services of the clinic would entail the materials, medical supplies, and magnetic stripe cards (membership card) that would be used for consultations and laboratory examinations. For those 10% premium members and 30% of the family cardholders of the total captured market of the total population of San Jose, Rodriguez, a bi-monthly magazine would be given to the member. As the captured market of HealthLink increases, the cost of services of the clinic would increase too. The increasing cost is paralleled to the percent increase of the market share demand of the semester.

Salaries and Wagesď&#x192;  The total amount of salaries and wages is based from the total number of employees with their respective salaries and compensation. At the first four semester (equivalent to two years), there would be no key management positions (clinic Page | 139


manager, I.T analyst, and accountant) as they would only be employed at the first year of the third semester when the second branch has been opened.

Employees Benefits  The employee benefits are based on the monetary equivalent of the benefits of the employees of HealthLink’s membership package.

Office Supply  The office supply will includes the purchase, handling costs, and other costs incurred when the office supply is delivered to the clinic. The amount in office supplies would increase in the third year when a second branch and a Manila based office is in operations.

Laundry and Cleaning  Laundry and cleaning expenses would include the janitorial expenses of the clinic. This amount would also increase at the third year when a second branch and a Manila based office is in operations.

Repairs and Maintenance  Repairs and Maintenance would entail the sustenance of the clinic’s equipments, specifically the electronic swipe card reader or the membership card sensor, portable x-ray, and its software. This repairs and maintenance of these equipments be done twice a month.

Promotions and advertisements  The promotions and advertisement expense are mainly the costs of the direct marketing activities (roving service, sticker give-away), PR ( Page | 140


give-away mug and towel, will be given to those who will avail of specific membership packages), and events costs to build the brand awareness of HealthLink (sportsfest and the Bayanihan para sa Kalusugan).

Rent and Utilities ď&#x192;  The rent expense includes the San Jose clinic branch rent for the first two years. On the third year, a Manila based office rent and San Juan clinic branch would be consolidated with the expenses. The renovation time is included in the computation of the cost. As for the utilities, these include the water, electricity, and telecommunication (telephone and internet) consumption of the clinics. The utilities expense would increase upon the establishment of a corporate office and second clinic branch.

Training and seminars ď&#x192;  The staff of Healthlink will undergo training before his actual position in the clinic or office and while being a regular employee, several training would be offered to ensure quality service depending on the requirements of his job description. Trainings would be done twice a year. The cost for the first semester of the first year is higher than the succeeding training costs because it is assumed that the company would be developing the skills of the hired employees and a refresher course would be done at the succeeding semesters.

Insurance ď&#x192;  HealthLink would apply for a yearly business insurance to have a back-up system in case an emergency would happen. the insurance cost is estimated from 10% Page | 141


of the total fixed assets of year one. The total insurance cost would increase during the operation of a Manila based office and additional branches.

Licensing Fee  The license fees would include the business permits and the Department of Health clinic license.

*Taxes  The total taxes that HealthLink would pay is 35% , this includes capital gains tax of 10%, e-vat tax of 3%, and the imposed Rizal local business tax rate of 22%. "Capital Gains Tax is a tax imposed on the gains presumed to have been realized by the seller from the sale, exchange, or other disposition of capital assets located in the Philippines. 113" This is enforced on the revenues earned by HealthLink from the sales of the membership cards and the revenue from walk-ins. E-vat is the expected increase in the tax rate, according to the Philippines Securities and Exchange Commission allotment for VAT 114. Business tax is the local business tax imposed by the municipality on to the firms that operate under their jurisdiction. The 22% tax rate is an estimate value taken from municipal income of Binangonan, Rizal in 2005 115. However, there is an alternative strategy that if the government would accept the invitation to support and recognize the HealthLink clinic as a community effort, then HealthLink will be exempted from the 22% tax rate of Rizal. An example would be the Silid Aralan, which is located in the local

114

“Minucipal Physical Framework Plan’. Municipality of Binangonan. Web. January 10, 2010. <http://www.binangonan.gov.ph/binangonan_socio_eco_profile.pdf> 12” “Capital Gains Tax.” Bureau of Internal Revenues. Web. January 11, 2010. <http://www.bir.gov.ph/taxinfo/tax_capgin.htm> 115 “Cost of Getting Started.” Securities and Exchange Commission. Web. Januaray 10, 2010. <http://www.coa.gov.ph/tsolmp/TSOIntra/Cost%20of%20Getting%20Started.htm>

Page | 142


community hall of San Jose, Rizal. It is a privately-owned school that provides supplementary education for public schools. It is being supported by the government and the benefits it receives are being exempted from the local business tax rate and free rental space.

B. Presentation of 3 Years Financial Statements (Balance Sheet, Income Statement) 1. Financial Schedules a. Before the beginning of the business (Year 2011) HealthLink Balance Sheet For the Year Start January 1, 2011 Assets Cash Inventory (a) Office Equipment (b) Machinery (c) Intangible Assets (d) Prepaid Expenses (e) Total Assets Liabilities Bank Loan Notes Payable Equity G. Garcia, Capital Total liabilities and equity

Php 1,000,000.00 332,939.00 242,930.00 193,379.50 500,000.00 23,010.00 Php 2,292,258.50 Php1,000,000.00 292,258.50 1,000,000.00 Php 2,292,258.50

b. i. Optimistic: Start of business operations (End of Fiscal Year Jan 2012) HealthLink Balance Sheets For Year Ended December 31, 2012 Assets Cash Inventory Office Equipment Machinery Depreciation (f)

Php988,503.50 377,555.00 242,930.00 193,379.50 (77,526.95) Page | 143


Intangible Assets Prepaid Expenses Amortization (f) Total Assets Liabilities Bank Loan Equity G. Garcia, Capital Net income Total Liability and Equity

500,000.00 23,010.00 (104,602.00) Php2,325,378.00 Php1,000,000.00 1,000,000.00 325,378.00 Php2,325,378.00

ii. Optimistic: (End of Fiscal Year Jan 2013) HealthLink Balance Sheets For Year Ended December 31, 2013 Assets Cash Inventory Office Equipment (g) Machinery Depreciation (g) Intangible Assets Prepaid Expenses Amortization (g) Total Assets Liabilities New Bank Loan Notes Payable Equity G. Garcia, Capital Net income Total Liability and Equity

Php3,216,074.00 678,607 985,860.00 386,759.00 (155,053.90) 500,000.00 46,020.00 (209,204.00) Php5,813,320.00 Php2,000,000.00 500,000.00 Php1,325,378.00 1,987,942 Php5,813,320.00

iii. Optimistic: (End of Fiscal year 2014) HealthLink Balance Sheets For Year Ended December 31, 2014 Assets Cash Inventory (i)

Php5,548,030.00 1,086,672 Page | 144


Office Equipment Machinery Depreciation (h) Intangible Assets Prepaid Expenses Amortization Total Assets Liabilities New Bank Loan Equity G. Garcia, Capital Net income Total Liability and Equity

985,860.00 386,759.00 (155,053.90) 500,000.00 46,020.00 (318,408.00) 8,444,137.00 Php2,000,000.00 Php3,313,320.00 3,130,817 Php8,444,137.00

iv. Optimistic 3 year Income Statement for 3 years HealthLink Income Statement For The Year Ended 2011

Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance Promotions/Advertising Training & Seminars Insurance Licensing Fees Total Operating Expenses EBITDA Depreciation Amortization Depreciation & Amortization EBIT/Operating Income Less Interest EBT Taxes (13%)* Net Income

Php3,391,922 377,555 3,014,367 Php1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 22,203 14,000 100,000 7,000 2,353,064 661,303 182,130 3,202 185,332 475,971 100,000 375,971 50,593 Php325,378

HealthLink

HealthLink

Income Statement For The Year Ended 2012

Income Statement For The Year Ended 2013

Php5,570,791 678,607 4,892,184

Php9,754,413 1,086,672 8,667,742

Php1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 4,000 8,000 100,000 0 2,321,861 2,570,323 182,130 3,202 185,332 2,384,991 100,000 2,284,991 297,049 Php1,987,942

Php2,829,360 30,978 624,000 360,000 72,000 150,912 12,000 26,203 22,000 200,000 7,000 4,334,453 4,333,289 394,101 6,404 400,505 3,932,784 250,000 3,682,784 551,966 Php3,130,817

*Refer to income statement assumptions Page | 145


b. i. Pessimistic: Start of business operations (End of Fiscal Year 2012) HealthLink Balance Sheets For Year Ended December 31, 2012 Assets Cash Inventory Office Equipment Machinery Depreciation (f)

Php515,374.50 332,044.00 242,930.00 193,379.50 (77,526.95)

Intangible Assets Prepaid Expenses Amortization (f) Total Assets Liabilities Bank Loan Equity G. Garcia, Capital Net loss Total Liability and Equity

500,000.00 23,010.00 (104,602.00) Php1,806,738.00 Php1,000,000.00 1,000,000.00 (193,262.00) Php1,806,738.00

ii. Pessimistic: (End of Fiscal year 2013) HealthLink Balance Sheets For Year Ended December 31, 2013 Assets Cash Inventory Office Equipment (g)

Php1,542,813.00 578,255 985,860.00

Machinery Depreciation (g)

386,759.00 (155,053.90)

Intangible Assets Prepaid Expenses

500,000.00 46,020.00

Amortization (g) Total Assets Liabilities Bank Loan Notes Payable Equity G. Garcia, Capital

(209,204.00) 1,806,738.00 Php1,000,000.00 500,000.00 806,738.00 Page | 146


Net income Total Liability and Equity

732,969 Php4,039,707.00

iii. Pessimistic: (End of Fiscal year 2014) HealthLink Balance Sheets For Year Ended December 31, 2014 Assets Cash Inventory (i) Office Equipment Machinery Depreciation (h) Intangible Assets Prepaid Expenses Amortization Total Assets Liabilities New Bank Loan Equity G. Garcia, Capital Net income Total Liability and Equity iv. Pessimistic 3 year Income Statement for 3 years HealthLink Income Statement For The Year Ended 2011

Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance Promotions/Advertising Training & Seminars Insurance

Php2,821,538 332,044 2,489,494 Php1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 22,203 14,000 100,000

Php1,444,888.00 947,897 985,860.00 386,759.00 (210,107.80) 500,000.00 46,020.00 (318,408.00) Php4,411,424.00 Php2,000,000.00 1,539,707.00 871,717 Php4,411,424.00

HealthLink

HealthLink

Income Statement For The Year Ended 2012

Income Statement For The Year Ended 2013

Php4,313,093 578,255 3,734,838 Php1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 4,000 8,000 100,000

Php7,712,311 947,897 6,764,414 Php2,829,360 30,978 624,000 360,000 72,000 150,912 12,000 26,203 22,000 200,000 Page | 147


Licensing Fees Total Operating Expenses EBITDA Depreciation Amortization Depreciation & Amortization EBIT/Operating Income Less Interest EBT Taxes (35%) Net Income

7,000

0

7,000

2,353,064 136,430 182,130 3,202 185,332 (48,902) 100,000 (148,902) 0 (Php165,379)

2,321,861 1,412,977

4,334,453 2,429,961

182,130 394,101 3,202 6,404 185,332 400,505 (1,227,645) 2,029,456 100,000 250,000 1,127,645 1,779,456 394,676 907,739 Php732,969 Php871,717

d. i. Most Likely Scenario: Start of business operations (End of Fiscal year 2012) HealthLink Balance Sheets For Year Ended December 31, 2012 Assets Cash Inventory Office Equipment Machinery Depreciation (f) Intangible Assets Prepaid Expenses Amortization (f) Total Assets Liabilities Bank Loan Equity G. Garcia, Capital Net loss Total Liability and Equity

Php543,257.50 332,044.00 242,930.00 193,379.50 (77,526.95) 500,000.00 23,010.00 (104,602.00) Php1,834,621.00 Php1,000,000.00 1,000,000.00 (165,379.00) Php1,834,621.00

Page | 148


ii. Most Likely Scenario: (End of Fiscal year 2013) HealthLink Balance Sheets For Year Ended December 31, 2013 Assets Cash Inventory Office Equipment (g) Machinery Depreciation (g) Intangible Assets Prepaid Expenses Amortization (g) Total Assets Liabilities NewBank Loan Notes Payable Equity G. Garcia, Capital Net income Total Liability and Equity

Php1,818,778.00 578,255 985,860.00 386,759.00 -155,053.90 500,000.00 46,020.00 -209,204.00 Php4,315,672.00 Php2,000,000.00 500,000.00 834,621.00 981,051 Php4,315,672.00

iii. Most Likely Scenario: (End of Fiscal year 2014) HealthLink Balance Sheets For Year Ended December 31, 2014 Assets Cash Inventory (i) Office Equipment Machinery Depreciation (h) Intangible Assets Prepaid Expenses Amortization Total Assets Liabilities New Bank Loan Equity G. Garcia, Capital Net income

Php2,391,432.00 947,897 985,860.00 386,759.00 (210107.80) 500,000.00 46,020.00 (318408.00) Php5,257,968.00 Php2,000,000.00 1,815,672.00 1,442,296 Page | 149


Total Liability and Equity

Php5,257,968.00

iv. Pessimistic 3 year Income Statement for 3 years HealthLink Income Statement For The Year Ended 2011

Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance Promotions/Advertising Training & Seminars Insurance Licensing Fees Total Operating Expenses EBITDA Depreciation Amortization Depreciation & Amortization EBIT/Operating Income Less Interest EBT Taxes (13%)* Net Income

HealthLink

HealthLink

Income Statement For The Year Ended 2012

Income Statement For The Year Ended 2013

Php2,821,538 332,044 2,489,494

Php4,313,093 578,255 3,734,838

Php7,712,311 947,897 6,764,414

1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 22,203 14,000 100,000 7,000 2,353,064 136,430 182,130 3,202 185,332 (48,902) 100,000 (148,902) 0 Php165,379

1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 4,000 8,000 100,000 0 2,321,861 1,412,977 182,130 3,202 185,332 1,227,645 100,000 1,127,645 146,594 Php981,051

2,829,360 30,978 624,000 360,000 72,000 150,912 12,000 26,203 22,000 200,000 7,000 4,334,453 2,429,961 394,101 6,404 400,505 2,029,456 250,000 1,779,456 337,160 Php1,442,296

*Refer to income statement assumptions

C. Projected Financial Statement Analysis 1. Break-Even Point Formula: SP-VC = TA

Package Options

Sales

OPEX

Patrons

VC

SP-VC

FA

BreakEven in Units

Premium (999/year) Family (1999/yr) Classic (500/year) Walk-in

449122 485051 1347365 540000

374552.04 404515.57 1123655.28 450341.11

749 449 4491 1800

500.07 900.93 250.20 250.19

498.93 1098.07 249.80 49.81

959319.5 959319.5 959319.5 959319.5

1922.75 873.64 3840.36 19259.39 Page | 150


(100/visit*3visits) Total

2821538 Table 30: Break-even point analysis

Looking at the different package options offered by HealthLink, the business will be able to break-even if 1923 people avail of the Premium package, 874 for Family, 3841 for classic, and 19259 for the walk-in instance.

2. Payback Period

Formula: Payback period = fixed assets â&#x20AC;&#x201C; Net Income (Remaining months=Remaining balance/ Net Income of next year)

Year 1 (2011) 2 (2012) 3 (2013)

Fixed Assets 959319.5

Remaining Net Income Balance -165379 1124699 981051 143647.5 1442296

*2 years + 143647.5/1442296 = 2.1 years Table 31: Paybackt analysis

In using the payback period formula, which is basically Assets minus Net Income, HealthLink will be able to earn back its investments in 2.1 years. This will be the month of February in the year 2013. 3. Return on Investment Formula: Return on Equity = Net Income / Total Equity

ROE Net Income Total Equity ROE

Year 1 -165379 806,738.00 -0.204997161

Year 2 981051

Year 3 1442296

3313312 6444137 0.296093758 0.223815229

Table 32: Return on investment analysis Page | 151


Since a lower ROE for each year means it is better, HealthLink will be able to retrieve the equity by Year 2, and will have a faster return on equity by Year 3.

4. Return on Assets Formula: Return on Assets = Net Income / Total Assets

ROA Net Income Total Assets ROA

Year 1 -165379 2325378 -0.07111919

Year 2 Year 3 981051 1442296 5813320 5257968 0.16875916 0.275561966

Table 33: Return on assets analysis Same as ROE, HealthLink will be able to retrieve the cost of assets by Year 2, and will have a faster return on assets by Year 3.

5. Profit Margin Ratio Formula: Profit Margin = Net Income / Sales

Profit Margin Ratio Net Income Sales Profit Margin Ratio

Year 1 -165379 2,821,538 -0.058613068

Year 2 Year 3 981051 1442296 4,313,093 7,712,311 0.22745881 0.187012168

Table 34: Profit margin analysis

Health Link will have an increasing profit by the second year but the profit margin will decrease due to the establishment of a second branch which will affect its total sales. 6. Liquidity and Solvency Formula: Current Ratio = Current Assets / Current Liabilities current ratio current assets current liability Current ratio

Year 1 847418.5 1000000 0.8474185

Year 2 3894681 500000 7.789362

Year 3 6634702 -

Table 35: liquidity and solvency analysis

Page | 152


HealthLink will only be able to cover its current liabilities by the companyâ&#x20AC;&#x2122;s current assets in year 2 with a 7.79 ratio, since the first year is below the average of 1. The third year has no liabilities, so that means the company doesnâ&#x20AC;&#x2122;t need current assets to cover it, hence, no ratio.

Page | 153


VI. Appendix

Page | 154


A. House of Quality

B. Health Link Prices Depending on the Packages Walk-in

Consultation Fee X-ray Hematology

Classic 10% off walk-in price

Premium 15% off walk-in price

Family 20% off walk-in price

100 500

90 450

85 425

80 400

Complete Blood Count

75

68

64

60

Platelet Count HGB & HCT

47 67

42 60

40 57

38 54

Bleeding Time Clotting Time

47 47

42 42

40 40

38 38

140

126

119

112

Reticulocyte Count

Page | 155


ESR

115

104

98

92

75

68

64

60

PBS/Peripheral Blood smear

150

135

128

120

LE Preparation Protime/PT APIT/PIT

235 235 285

212 212 257

200 200 242

188 188 228

Clinical Microscopy Urinalysis Fecalysis Urobilinogen

47 47 75

42 42 68

40 40 64

38 38 60

Ketone/Acetone

75

68

64

60

Biles/Nitrates/Bilrubin Sugar

75 75

68 68

64 64

60 60

Micro-Alburnin Test

380

342

323

304

Pregnancy Test Occult Blood

95 140

86 126

81 119

76 112

Concentration Technique Urine Test

85 235

77 212

72 200

68 188

Creatinime Total

235

212

200

188

Creatinine Clearance Protein

190 235

171 212

162 200

152 188

Na/K/Cl (each) Calcium/Magnesium (each) Uric Acid Amylase Glucose VMA Hepatitis

235

212

200

188

235 235 235 235 1,045

212 212 212 212 941

200 200 200 200 888

188 188 188 188 836

190

171

162

152

ABO & RH typing

HbsAg (screening)

Page | 156


HbsAg w/ titer (ELISA)

285

257

242

228

Anti-HBS w/ titer HbeAg Anti-Hbe

285 330 330

257 297 297

242 281 281

228 264 264

Anti-HBc IgM Anti-HBc IgG

330 330

297 297

281 281

264 264

Anti-HAV IgM

330

297

281

264

Anti-HAV IgG Anti-HCV

330 620

297 558

281 527

264 496

1,425

1283

1211

1140

Hepatitis A Profile

855

770

727

684

Hepatitis B Profile

1,425

1283

1211

1140

Hepatitis A, B, C Profile Wee Bag

2,090 14

1881 13

1777 12

1672 11

2Hr Post Prandial Blood

190

171

162

152

Blood Chemistry FBS/RBS OGCT OGTT

95 285 520

86 257 468

81 242 442

76 228 416

BUN/CREATININE (each) BUA Cholesterol Triglycerides

95 95 95 140

86 86 86 126

81 81 81 119

76 76 76 112

HDL/LDL (each)

140

126

119

112

Bilirubin (TB,DB,ID) Total Protein Albumin TPAG HBA1C Enzymes

330 140 140 285 475

297 126 126 257 428

281 119 119 242 404

264 112 112 228 380

Hepatitis Profile

Page | 157


SGPT/ALT SGOT/AST GGTP

105 105 475

95 95 428

89 89 404

84 84 380

Alkaline Phophatase

170

153

145

136

Acid Phosphatase Amylase Lipase Total CPK CPK - MB CPK - MM

170 235 285 570 570 570

153 212 257 513 513 513

145 200 242 485 485 485

136 188 228 456 456 456

Troponin I/T (each) LDH Electrolytes Sodium Potassium Chloride Magnesium

760 380

684 342

646 323

608 304

120 120 120 235

108 108 108 212

102 102 102 200

96 96 96 188

Inorganic Phosphorus Total Iron

235 380

212 342

200 323

188 304

TIBC + TOTAL Iron Calcium

620 235

558 212

527 200

496 188

Ionized Calcium Thyroid Test T3/T4 (each) TSH FT3 FT4 FT1 Serology VDRL/RPR

330

297

281

264

235 380 430 430 430

212 342 387 387 387

200 323 366 366 366

188 304 344 344 344

140

126

119

112

TPHA Screening

380

342

323

304

TPHA w/ Titer Widal Test Typhidot ASO Titer

570 330 665 330

513 297 599 297

485 281 565 281

456 264 532 264

Page | 158


CRP w/ titer 250 RA/RF Latex C3/C4 (each)

195 285 665

176 257 599

166 242 565

156 228 532

855 1,045

770 941

727 888

684 836

Dengue IgM & IgG

665

599

565

532

Leptospiral Test H.Pylori Rubella IgM Rubella IgG

760 855 760 760

684 770 684 684

646 727 646 646

608 684 608 608

CMV IgM & IgG

1,045

941

888

836

Toxoplasma IgM

1,045

941

888

836

Toxoplasma IgG Bacteriology Gram Stain AFB KOH India Ink Blood C/S

1,045

941

888

836

195 330 285 330 475

176 297 257 297 428

166 281 242 281 404

156 264 228 264 380

Culture Sensitivity Hormones FSH/LH Prolactin

430

387

366

344

665 665

599 599

565 565

532 532

Estrogen / Estradiol Progesterone Testosterone Cortisol Ferritin

760 760 855 855 760

684 684 770 770 684

646 646 727 727 646

608 608 684 684 608

950 855 1,045 760 1,425

855 770 941 684 1283

808 727 888 646 1211

760 684 836 608 1140

ANA Screening ANA w/ Titer

Tumor Markers AFP CEA PSA B-HCG CA-125

Page | 159


CA-15-3 CA-19-9 CA-72-3 Drug Test MET / THC HIV Test

1,615 1,900 2,375

1454 1710 2138

1373 1615 2019

1292 1520 1900

285

257

242

228

HIV Screening Test

475

428

404

380

HIV w/ Titer (ELISA) Others

760

684

646

608

Stone Analysis PAP Smear

380 75

342 68

323 64

304 60

C. Accounting Cycle 116 The first step is collecting and analyzing transactions and events for journalizing. The accountant or financial executive will gather and prepare receipts related to financial events and will be analyzed in line with their effects on the companyâ&#x20AC;&#x2122;s financial position as which accounts are affected, how (increase or decrease) and how much. An example would be collecting the sales receipt of the clinic for the day and inputting these into the companyâ&#x20AC;&#x2122;s chart of accounts as Cash and Sales category. The second step is entering or journalizing the collected information as an entry into the journal diary. Recorded financial events are done in a chronological order and may be done continually. It can also be done per batch when similar transactions are being sorted and collected. For example, if the clinic purchased some disposable syringes for P50, it will be recorded as Medical Supplies P50 and Cash P50. Entries recorded show the amount that was transacted and the effect of the transaction to the account titles in terms of debits and credits. The medical supplies will be debited while the cash will be credited since the company gained supplies while decreased in cash. GENERAL JOURNAL Date 2011, Jan 5

Description Medical Supplies Cash

page 10 Debit 50

Credit 50

The third step is posting the debit and credit entries from the journal to the general ledger accounts. Transactions made under the same account are collected and summarized into that particular account and then posted as the final entry for the process. Usually an account number is assigned to each ledger and these ledger accounts may be in T-account form or may include balances. These also show the effects and references of the transaction made.

116

th

Larson, Wild, Chiapetta. Principles of Financial Accounting. Accounting cycle. McGrawHill 7 edition

Page | 160


General Ledger account Cash Date Description PR 2011, Jan 5 10

Debit

General Ledger account Supplies Date 2011, Jan 5

Description

Account no. 101 Credit Balance 50 50 Account no. 126

PR

Debit

10

50

Credit

Balance 50

The fourth step is preparing an unadjusted trial balance which summarizes the unadjusted ledger accounts and amount in a table form. Double entry accounting requires the sum of debit account (right side) equals to the sum of the credit account (left side). Accounts such as assets and expenses have debit balances while other accounts such as liabilities, owner’s equity and revenues have credit balances. Total amounts of these should be equal to each other that is why preparing an unadjusted trial balance tests the quality of these as recorded in the general ledger. It is also useful to investigate if inequality occurs. It is not a financial statement but a working table used to prepare the financial statements. The fifth step is preparing and recording adjustments of journal entries to bring the account balances up-to date and to check for discrepancies. This includes setting up post accrued and deferred items to journals and ledger T-accounts. Under accrual accounting, an entry may be required at the end of the period to record revenues that have been earned but not yet recorded on the books. Similar adjustments also have to be made to record expenses that may have been incurred but not yet recorded. The sixth step is preparing an adjusted trial balance. This step reviews the equality of the debits and credits of the aforementioned entries. Unequal amounts or inaccurate accounts are rechecked and corrected. It is important to ensure that all the information is accurate and ready for the making of the end-of-period financial statements. The seventh step is preparing the financial statements using the corrected entries from the adjusted trial balance. The financial statements includes the a.) Balance sheet which shows the summary of the amount of assets, liabilities and owner’s equity for the financial period, b.) Statement of cash flow which displays the inflow and outflow of all the money and c.) Income statement which shows the company’s amount of revenues earned and the amount of expenses and losses for the accounting period. This step also includes compiling the statements, tax returns and other accounting reports in order to close out the accounting period. The eight step is closing the accounts or zeroing out the balances from temporary accounts such as revenues and expenses from the income statement to the owner’s equity in the balance sheet. The only accounts that have balances are the asset, liability and owner’s equity accounts and these balances will be carried on towards the next accounting period.

Page | 161


The last step is preparing a post-closing trial balance which is done to determine if all revenue and expense accounts have been properly closed and if the debit and credit balances of all accounts are equal to each other.

D. Limited Liability Company Fundamental changes within the business such as admission of new members in the LLC require the unanimous approval of the existing members first. Members can assume an active management role wherein an operating agreement helps define and distribute the rights of the members and managers, if any, regarding membership, management, operations and income distribution issues. This private operating agreement, unless provided otherwise, grants members the responsibility for managing the LLC but they can also opt to delegate their management authority to a particular member as the manager, to a group of members or in some cases, to a non-member manager. 117 As a separate legal entity, it also has advantages that include having less administrative paperwork since there is no need to formally keep track of minutes and meetings as required in corporations and no distribution of stocks so there are fewer formalities involved. An LLC also has a more flexible and varying forms of profit distribution unlike for partnerships where the division is 50-50. 118 Members of an LLC can contribute capital in exchange for a membership interest, which usually includes economic interest. There is no minimum amount of capital contribution and members can usually contribute in cash, property or services. 119 A member’s contribution to the company determines the member’s voting and financial rights in the LLC, unless the operating agreement states otherwise. If a member fails to deliver a promise of a future contribution to the LLC in exchange for membership interest, the LLC can impose the promise as a contract or sell the member’s existing interest to make up for the failure. 120 An LLC, however, has a limited life and is usually dissolved upon death, expulsion, retirement or resignation of a member or if the company goes under bankruptcy or dissolution. Nevertheless, remaining members may voluntarily choose to continue or close the LLC at any time and for any reason but may involve a complex process depending on the laws of the state where the LLC is located. 121 The accounting system of an LLC is designed to help management comply with the regulations adopted by its members and with the dictates of the articles of organizations, which is a document that must be first filed by the LLC with the secretary of state in which the LLC will be located. The accounting system must also provide information that would support the company’s compliance with state and federal laws, as well as taxation. 122

117

Ibid. http://sbinformation.about.com/cs/ownership1/a/LLC.htm 119 http://legal-dictionary.thefreedictionary.com/Limited+Liability+Company 120 Ibid. 121 http://business-law.lawyers.com/business-enterprises/Limited-Liability-Company.html 122 Principle of Financial Accounting book, p470 118

Page | 162


E. Financial Schedules 1. Balance Sheet Before the beginning of the business (Year 2011) (a) Inventory: Membership Cards (Inventory) 140,360.00 Medical Supplies 150,000.00 (Inventory) Health Digest (Inventory)

42,579.00

(b) Office Equipment: Computers

110,000.00

(c) Machinery: Abbot AxSYM system

24,500.00

Xray(USB)

100,000.00

Pharma Unicap

20,000.00

Microscope Coulter JT Heme Analyzer

16,660.00

ASNR Gamma Counter

10,000.00

15,000.00

Desks

53,900.00

Plastic Containers

2,695.00

Air conditioners

33,600.00

Weighing Scales

1,911.00

Chairs

27,930.00

Spyghmomamonitor

1,500.00

Bed

9,800.00

Test Tubes

900.00

Printer

5,000.00

Glass Slides

213.50

Scanners

2,700.00 (e) Prepaid Expenses:

(d) Intangible Asstes: software development

500,000.00

License

7,000.00

PATENT

16,010.00

Optimistic, Pessimistic, and Most Likely Scenario Start of business operations (End of Fiscal Year 2012) (f) Depreciation per year: License PATENT software development and modification

Value 7,000.00 16,010.00 500,000.00

Life

Dep'n / Amort.

5

1,400.00

5

3,202.00

5

100,000.00 Page | 163


Computers Desks Air conditioners Chairs Bed Printer Scanners Abbot AxSYM system Xray(USB) Pharma Unicap Microscope Coulter JT Heme Analyzer ASNR Gamma Counter Plastic Containers Weighing Scales Spyghmomamonitor Test Tubes Glass Slides

110,000.00 53,900.00 33,600.00 27,930.00 9,800.00 5,000.00 2,700.00 24,500.00 100,000.00 20,000.00 16,660.00 15,000.00 10,000.00 2,695.00 1,911.00 1,500.00 900.00 213.50

5

22,000.00

10

5,390.00

5

6,720.00

10

2,793.00

10

980.00

5

1,000.00

5

540.00

5

4,900.00

5

20,000.00

5

4,000.00

5

3,332.00

5

3,000.00

5

2,000.00

10

269.50

10

191.10

5

300.00

10

90.00

10

21.35

Page | 164


Optimistic, Pessimistic, and Most Likely Scenario: Start of business operations (End of Fiscal year 2013) (g) acquisition of new assets:

Value

Life

Dep'n / Amort.

License

7,000.00

5

1,400.00

PATENT

16,010.00

5

3,202.00

software development and modification

500,000.00

5

100,000.00

Computers

110,000.00

5

22,000.00

Desks

53,900.00

10

5,390.00

Air conditioners

33,600.00

5

6,720.00

Chairs

27,930.00

10

2,793.00

Bed

9,800.00

10

980.00

Printer

5,000.00

5

1,000.00

Scanners

2,700.00

5

540.00

24,500.00

5

4,900.00

100,000.00

5

20,000.00

Pharma Unicap

20,000.00

5

4,000.00

Microscope

16,660.00

5

3,332.00

Coulter JT Heme Analyzer

15,000.00

5

3,000.00

ASNR Gamma Counter

10,000.00

5

2,000.00

Plastic Containers

2,695.00

10

269.50

Weighing Scales

1,911.00

Spyghmomamonitor

1,500.00

Abbot AxSYM system Xray(USB)

Test Tubes

900.00

Glass Slides New Office Equipment

213.50

10 5 10 10

191.10 300.00 90.00 21.35

5 Page | 165


500,000.00

100,000.00

Optimistic, Pessimistic, and Most Likely Scenario: Start of business operations End of Fiscal year 2014 (h) Depreciation of New Office Assets New Office Assets (i) New Inventory inventory of both Health Link centers

Value 500,000.00

Life

Dep'n / Amort.

5

100,000.00

947,897

2. Income Statement

i. Revenue Market Share (MS) x Barangay Population = No. of Card Holders (CH) Premium - (10% x CH)* x Php100 = Monthly Sales from Premium Card Holders Family - [(30% x CH)/5] 123* x Php180 = Monthly Sales from Family Card Holders Classic - (10% x CH)* x Php50 = Monthly Sales from Classic Card Holders *No. of Members Total Revenues = Total Sales from CH + Walk-In Sales 124

1st SEM MK = 0.03 CH = 2,807 Package # of Members Sales/mo Sales/6mo Premium 281 28,070 168,421 Family 168 30,316 181,894 Classic 1,684 84,210 505,262 Walk-in NA 45,000 270,000 Total 1,125,577 YEAR 1 2nd SEM MK = 0.05 CH = 4,678 Package # of Members Sales/mo Sales/6mo Premium 468 46,784 280,701 Family 281 50,526 303,157 Classic 2,807 140,351 842,103 Total Revenue Walk-in NA 45,000 270,000 2,821,538 Total 1,695,961

123 124

1 Family Card is good for 5 family members Estimations made are based on Health Expertâ&#x20AC;&#x2122;s daily revenues, Php3,000

Page | 166


1st SEM MK = 0.06 CH = 5,895 Package # of Members Sales/mo Sales/6mo Premium 589 58,947 353,683 Family 354 63,663 381,978 Classic 3,537 176,842 1,061,050 Walk-in NA 45,000 270,000 Total 2,066,711 YEAR 2

2nd SEM MK = 0.07 CH = 6,484 Package # of Members Sales/mo Sales/6mo Premium 648 64,842 389,052 Family 389 70,029 420,176 Classic 3,891 194,526 1,167,155 Total Revenue Walk-in NA 45,000 270,000 4,313,093 Total 2,246,382 1st SEM MK = 0.08 CH = 7,133 Package # of Members Sales/mo Sales/6mo Premium 713 71,326 427,957 Family 428 77,032 462,193 Classic 4,280 213,978 1,283,870 Walk-in NA 45,000 270,000 Total 2,444,020 YEAR 3

2nd SEM MK = 0.08 CH = 7,668 Package # of Members Sales/mo Sales/6mo Premium 767 76,676 460,054 Family 460 82,810 496,858 Classic 4,601 230,027 1,380,161 Total Revenue Walk-in NA 45,000 270,000 5,051,092 Total 2,607,072

ii. Cost of Service Medical Supplies 125 = Previous semesterâ&#x20AC;&#x2122;s expense increased by the same percentage increase of the demand Membership Cards = CH x Php20 Publications126 = (P + F) x Php9 127 x 3 128 Total Cost of Service = Medical Supplies + Membership Cards + Publications 125

Php10,000 was used as a base estimate for the first semesterâ&#x20AC;&#x2122;s monthly expenses Bi-monthly Digest 127 Price per digest (based on quotation in UP Shopping Center) 128 Number of issues every semester 126

Page | 167


Note: Periods â&#x20AC;&#x201C; Y1S1 = 1st Year, 1st Semester etc.

Period Med. Supplies Cards Publication Cost of Service Y1S1 60,000 56,140 12,126 128,266 Y1S2 90,000 93,567 20,210 203,777 Y2S1 126,000 117,894 25,465 269,360 Y2S2 151,200 129,684 28,012 308,896 Y3S1 Clinic1 166,320 142,652 30,813 339,785 Y3S2 Clinic1 178,794 153,351 33,124 365,269 Y3S1 Clinic2 60,000 52,993 4,557 117,550 Y3S2 Clinic2 90,000 35,328 7,596 132,924

iii. Depreciation and Amortization Note: The depreciation and Amortization rates differ per item : New office assets are assumed to be worth with depreciation over n years : New assets are acquired by year 3 for the expansion, but will only add assets identical to the ones bought during the start up

Fixed Assets

Depreciation/ Amortization per year

Asset value

Useful life

7,000.00

5

1,400.00

16,010.00

5

3,202.00

500,000.00

5

100,000.00

110,000.00

5

22,000.00

53,900.00

10

5,390.00

33,600.00

5

6,720.00

27,930.00

10

2,793.00

9,800.00

10

980.00

5,000.00

5

1,000.00

Intangible Assets License Patent Tangible Assets software development and modification Computers Desks Air conditioners Chairs Bed Printer

Page | 168


Scanners Abbot AxSYM system X-ray(USB) Pharma Unicap Microscope Coulter JT Heme Analyzer ASNR Gamma Counter Plastic Containers Weighing Scales Spyghmomamonitor Test Tubes Glass Slides

2,700.00

5

540.00

24,500.00

5

4,900.00

100,000.00

5

20,000.00

20,000.00

5

4,000.00

16,660.00

5

3,332.00

15,000.00

5

3,000.00

10,000.00

5

2,000.00

2,695.00

10

269.50

1,911.00

10

191.10

1,500.00

5

300.00

900.00

10

90.00

213.50

10

21.35 182,128.95

Total Depreciation Per Year

iv. Detailed Income Statements for Most Likely Scenario Year 1 (2011)

Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance Promotions/Advertising Training & Seminars Insurance Licensing Fees Total Operating Expenses EBITDA Depreciation

2nd SEM YEAR-END 1ST SEM 1,125,577 1,695,961 2,821,538 (128,266) (203,777) (332,044) 997,310 1,492,184 2,489,494 864,960 864,960 0 20,485 120,000 120,000 75,000 75,000 12,000 12,000 19,728 19,728 3,000 3,000 20,203 2,000 10,000 4,000 50,000 50,000 7,000 0 1,181,891 1,171,173 (184,581) (321,011) (91,065) (91,065)

1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 22,203 14,000 100,000 7,000 2,353,064 (136,430) (182,130)

Page | 169


Year 2 (2012)

Year 3 (2013)

Amortization 0 (3,202) Depreciation & Amortization (91,065) (94,267) EBIT/Operating Income (275,646) (226,744) Less Interest 0 100,000 EBT (275,646) 126,744 Taxes (13%) 0 16,477 Net Income (275,646) 110,267

(3,202) (185,332) (48,902) 100,000 (148,902) 16,477 (165,379)

1ST SEM 2nd SEM YEAR-END 2,066,711 2,246,382 4,313,093 (269,360) (308,896) (578,255) 1,797,351 1,937,486 3,734,838

Revenues Cost of Services Gross Income Operating Expenses: 864,960 864,960 Salaries & Wages 0 20,485 Employees' Benefits 120,000 120,000 Rent 75,000 75,000 Utilities 12,000 12,000 Office Supplies 19,728 19,728 Laundry & Cleaning 3,000 3,000 Repairs & Maintenance 2,000 2,000 Promotions/Advertising 4,000 4,000 Training & Seminars 50,000 50,000 Insurance 1,150,688 1,171,173 Total Operating Expenses 646,663 766,313 EBITDA (91,065) (91,065) Depreciation 0 (3,202) Amortization (91,065) (94,267) Depreciation & Amortization 555,598 672,046 EBIT/Operating Income 0 100,000 Less Interest 555,598 572,046 EBT 72,228 74,366 Taxes (13%) 483,371 497,680 Net Income Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance

1,729,920 20,485 240,000 150,000 24,000 39,456 6,000 4,000 8,000 100,000 2,321,861 1,412,977 (182,130) (3,202) (185,332) 1,227,645 100,000 1,127,645 146,594 981,051

Clinic 1 Clinic 2 HealthLink 5,051,092 2,661,219 7,712,311 (705,054) (242,843) (947,897) 4,346,038 2,418,376 6,764,414 961,920 1,729,920 10,493 20,485 240,000 240,000 150,000 150,000 24,000 24,000 39,456 39,456 6,000 6,000

2,829,360 30,978 624,000 360,000 72,000 150,912 12,000

Page | 170


Promotions/Advertising Training & Seminars Insurance Licensing Fee Total Operating Expenses EBITDA Depreciation Amortization Depreciation & Amortization EBIT/Operating Income Less Interest EBT Taxes (13%) Net Income

Revenues Cost of Services Gross Income Operating Expenses: Salaries & Wages Employees' Benefits Rent Utilities Office Supplies Laundry & Cleaning Repairs & Maintenance Promotions/Advertising Training & Seminars Insurance Licensing Fee Total Operating Expenses EBITDA Depreciation Amortization Depreciation & Amortization EBIT/Operating Income Interest EBT Taxes (13%) Net Income

4,000 8,000 100,000 0 1,543,869 2,802,169 (182,130) (3,202) (185,332) 2,616,837 100,000 2,516,837 327,189 2,189,648

22,203 14,000 100,000 7,000 2,353,064 65,312 (182,130) (3,202) (185,332) (120,020) 150,000 (270,020) 0 (279,991)

26,203 22,000 200,000 7,000 4,334,453 2,429,961 (394,101) (6,404) (400,505) 2,029,456 250,000 1,779,456 337,160 1,442,296

CLINIC 1 CLINIC 2 1ST SEM 2nd SEM 1ST SEM 2nd SEM 2,444,020 2,607,072 1,061,407 1,599,812 (339,785) (365,269) (114,688) (128,155) 2,104,235 2,241,803 946,719 1,471,657 480,960 10,493 120,000 75,000 12,000 19,728 3,000 2,000 4,000 50,000 0 777,181 1,327,054 (91,065) 0 91,065 1,235,989 0 1,235,989 160,679 1,075,311

480,960 0 120,000 75,000 12,000 19,728 3,000 2,000 4,000 50,000 0 766,688 1,475,115 (91,065) 3,202 94,267 1,380,848 100,000 1,280,848 166,510 1,114,338

864,960 864,960 20,485 0 120,000 120,000 75,000 75,000 12,000 12,000 19,728 19,728 3,000 3,000 20,203 2,000 10,000 4,000 50,000 50,000 7,000 0 1,202,376 1,150,688 (255,657) 320,969 (91,065) (91,065) 0 3,202 91,065 94,267 (346,722) 226,702 0 150,000 (346,722) 76,702 0 9,971 (346,722) 66,731

Page | 171


Ctk41 HealthLink Business Plan