Adult Day Services at the WBRP Nursing Home in Flushing, Queens, New York - Essay Example

? Adult Day Services at the WBRP Nursing Home in Flushing, Queens, New York- Proposal Paper Table of Contents I. Summary 3 II. Market Analysis 3 A. Market Demographics, Size, Characteristics 3 B. Market Trends, Events of Impact 4 C. Target Market Characteristics, Purchase Patterns, Needs 5 III. Internal Analysis vs. Industry and Environmental Factors 5 A. The Nursing Homes Industry 5 B. Adult Day Services Industry 6 C. Competition Analysis 7 D SWOT Analysis 8 IV. Strategy Formulation 9 References 11 I. Summary The results of a market, industry, and internal analysis and assessment are that there are opportunities for WBRP Nursing Home to pursue providing adult day services as an adjunct to existing services provided by the home to its current customers and target market. The paper presents the results of the analyses and the formation of a preliminary set of strategies to take advantage of the identified opportunities (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010). II. Market Analysis A. Market Demographics, Size, Characteristics While the nursing home is in Flushing, Queens, New York, we take the whole potential market for nursing home services and related services, existing or the be introduced, to consist of target market customers living in the greater Queens, New York area. This is a conservative estimate, as with proper marketing and targeting the target market geographically speaking can be as broad as the whole of New York City. Focusing on Queens, the statistics are that the total population has been static at around 2.3 million in 2010, roughly the same level as in 2000. People over 65 years of age made up 12.8 percent of the population, or more than 230,000 residents above that age. Some estimates put the number of people over 65 at about 283,000, with roughly equal numbers of men and women, and about 44 percent of the overall population being of Caucasian descent, 20 percent African American, and 17.6 percent Asian. This is the rough estimate of the potential market size for nursing home and related services in the Queens area of New York (US Census Bureau, 2012; Onboard Informatics, 2011; Wolfram Alpha LLC, 2012; ePodunk, 2007; Roleke, 2012). Prospectively, however, hypothesizing that adult day services provision is viable, the target market is expanded to include all adults who may avail of such services, short-term and long term. This expands the market size to all but those who are under 18 years old and living in Queens, or all Queens residents except for about 21 percent of the population, who are minors (US Census Bureau, 2012; Onboard Informatics, 2011; Wolfram Alpha LLC, 2012; ePodunk, 2007; Roleke, 2012) The median income of a household is pegged at roughly the same amount as the city median income, at about 55,300 dollars, while the cost of living is much higher as judged by the cost of living index of about 159, much higher than the national average of 100. This is a relatively wealthy neighborhood, and therefore is ripe for services tied to nursing home services (US Census Bureau, 2012; Onboard Informatics, 2011; Wolfram Alpha LLC, 2012; ePodunk, 2007; Roleke, 2012; Hevesi and Bleiwas, 2006). B. Market Trends, Events of Impact The recent recession has brought about changes in the buying power and long-term financial viability of a large swath of the American population, including people in Queens, New York. This has had an impact on the ability of people over 65 years to finance long-term care on their own and with the help of family. This in turn has had an impact on the viability of providers of long-term care to the elderly, including nursing homes and providers of corollary services to homes (The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012). C. Target Market Characteristics, Purchase Patterns, Needs The market for long-term elderly care is said to be huge, and constitutes a significant portion, in money terms, of the total expenditure for all health care in the United States, for all age groups (7.5 percent, or 100 billion dollars annually as of the year 2000). Over the next four decades, the total expenditures for elderly care are projected to shoot up by 300 percent from 2000 figures. A minority of this total expenditure will be covered by insurance, as very few in this target market are covered for long-term elderly care. This means that most expenses will be covered from the own pockets of the elderly and their families, a figure that was pegged at 40 percent of all costs of elderly long-term care in the year 2000. Clearly costs of care and ability to pay shall be prominent issues for this target market moving forward (The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012) III. Internal Analysis vs. Industry and Environmental Factors A. The Nursing Homes Industry The industry has been wrestling with a number of fundamental issues for a long time, including balancing profitability versus care quality; reputation and public perception issues; debates on whether for profit or non-profit arrangements for nursing homes are optimal vis-a-vis quality of care and patient welfare; long-term funding for patient care; insurance versus out of pocket expenditures for patients; staffing quality and adequacy concerns; cost efficiency versus staff quality and loyalty; and a host of related issues and concerns that have weighed down on the industry for a long time. This is just the tip of the iceberg, however, as impending changes in legislation, coupled by the reduced spending power of the target market for such services, massive healthcare coverage cuts, and a host of other issues relating to a tectonic shift in the way America takes care of its elderly, increasingly makes the business viability of nursing homes suspect. 500 billion dollars had been cut from the Medicaid payment pool by legislation passed in late 2010, for example. The interplay of such factors and developments have resulted in some quarters concluding that nursing homes will become extinct, even as others have pointed to new opportunities on the horizon that may revive the fortunes of the homes. The new opportunities sometimes require a shift in focus away from the old, and towards new types of clients, such as those who are recuperating from surgery (The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012). B. Adult Day Services Industry The idea of adult day services as centers where adults with chronic illnesses, those recovering after being discharged from hospitals, and those needing intensive rehabilitation and a host of other psychological and physical long-term therapeutic interventions is fast catching on, and evidence of this is the proliferation of such adult day service centers. In many cases nursing homes have come to double as adult day services, one because the economics of such centers are often better, catering to a different set of clients, than the client base of traditional nursing homes (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012). The statistics relating to adult day services are encouraging, in terms of the viability of such services in the long term, even as the present financial fundamentals of providing recuperative and short-term rehabilitation services to adults of all ages, as a key offering of adult day services, are already compelling on their own. In 2010, there were 4,600 such adult day service centers operating in America, a one-third increase over levels counted in 2002. 80 percent of the facilities have nurses, 60 percent have case management workers, and 50 percent have social workers as staff. A quarter million patients all over the United States avail of the services, and their pathology profiles include hypertension, mental disorders, heart disease, differing disabilities, and dementia. The improved financials and long-term outlook for adult day services over traditional nursing homes may make for a compelling business case (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010). C. Competition Analysis All nursing homes can potentially also offer adult day services as an additional set of services, or as a repurposing of their mandates and business models. Therefore, all nursing homes in the Queens area are potential competitors. The financial fundamentals are assumed to be similar for nursing homes in Queens as in typical homes elsewhere, and therefore the preceding analysis on the nursing homes industry and the adult day services industry hold. A cursory look at the existing nursing homes gives this paper an idea of competition terrain. There is room to differentiate from competition in the area, by for example being first to market with adult day services, and by improving on care quality and similar metrics. With an expanded potential market to include all adults in the Queens area, there are plenty of opportunities for all competitors to get a good slice of the total business for adult day services (New York State Department of Health, 2012; AllOneSearch, 2012). D SWOT Analysis The WBRP Nursing Home operates from a number of strengths relative to a planned provision of adult day services. One is that the nursing home already has a track record of having successfully operated the facility, and a track record of financial viability and stability of operations. The staff is in place, and can be retrained to accommodate adult day service participants. The facility itself can be repurposed for such an endeavor. Staffing can be enlarged and improved as the business improves. These capabilities are key strengths that the nursing home can leverage to successfully get into adult day services (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010). Weaknesses include that the facility has relatively little experience in dealing with adult day service participants/cases, and may be less than effective at startup. Also, the facility may not have the requisite management capabilities at present for such a service (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010). Opportunities are in the area of going into adult day services with a mind towards differentiating itself from potential competitors, via providing quality care, and via being first to market. Being first to market confers several advantages, including gaining experience, and gaining market share by catering to the unmet needs of existing clients in the Queens area. Threats are the nursing homes in Queens, who may get to the market as well, and beat WBRP in quality and in speed to market (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010). IV. Strategy Formulation The identified opportunity above also constitutes the seeds of a marketing, operations, and execution strategies that the nursing home can pursue in order to successfully launch adult day care services within the nursing home. The overall strategy is that of differentiation in terms of providing quality care, and being first to market. There are operational and financial implications to such a strategy, and those include preparing staff to meet care demands, investing for repurposing, and training management in the provision and operation of a facility that offers such services (National Adult Day Services Association, 2012; National Adult Day Services Association, 2010; The Economist Newspaper Limited, 2010; Gleckman, 2009; International Health Economics, 2011; Hicks et al., 2004; National Bureau of Economic Research, 2012; Center on Age and Community, 2010) References AllOneSearch (2012). Flushing Nursing Homes. Nursing Homes in Flushing/AllOneSearch.com. Retrieved 6 April 2012 from http://www.allonesearch.com/nursing-homes/new-york/flushing Center on Age and Community (2010). 2010 Next Steps Think Tank: Adult Day Services. University of Wisconsin Milwaukee Helen Bader School of Social Welfare. Retrieved 6 April 2012 from http://www.nadsa.org/wp-content/uploads/2012/03/2010-Think-Tank-adult-day-white-paper-final-7.18.11.pdf ePodunk (2007). Population Overview- Queens, New York. ePodunk. Retrieved 6 April 2012 from http://www.epodunk.com/cgi-bin/popInfo.php?locIndex=1494 Gleckman, H. (20072009). The Death of Nursing Homes. Kaiser Health News. Retrieved 6 April 2012 from http://www.kaiserhealthnews.org/Columns/2009/September/092809Gleckman.aspx Hevesi, A. and Bleiwas, K. (June 2006). Economic Development and the Economy of Flushing, Queens. New York City Public Information Office/Office of the State Comptroller. Retrieved 6 April 2012 from http://www.google.com/url?sa=t&rct=j&q=flushing+queens+demographics&source=web&cd=6&ved=0CFoQFjAF&url=http%3A%2F%2Fwww.osc.state.ny.us%2Fosdc%2Frpt4-2007flushing.pdf&ei=M2uAT4m4GcyimQW1vJGFCA&usg=AFQjCNFlCY9ZJ_DOhFliUIQABTQBdGcKnw Hicks, L. et al. (2004). Nursing home costs and quality of care outcomes. CBS Interactive. Retrieved 6 April 2012 from http://findarticles.com/p/articles/mi_m0FSW/is_4_22/ai_n17207336/ International Health Economics Association (2011). Economics of Nursing Homes. AbstractsSubmit iHEA 2011. Retrieved 6 April 2012 from http://ihea2011.abstractsubmit.org/sessions/184/ National Adult Day Services Association (2012). nadsa. The national voice for the adult day service community. nadsa.org. Retrieved 6 April 2012 from http://www.nadsa.org/ National Adult Day Services Association (2010). MetLife National Study 2010. nadsa.org. Retrieved 6 April 2012 from http://www.nadsa.org/?page_id=89 National Bureau of Economic Research (2012). Long-Term Care Insurance and Nursing Home Use. NBER.org. Retrieved 6 April 2012 from http://www.nber.org/digest/mar04/w9957.html New York State Department of Health (April 2012). Queens County Nursing Homes. NYHealth.gov. Retrieved 6 April 2012 from http://nursinghomes.nyhealth.gov/searches/county/41 Onboard Informatics (2011). Queens, New York. City-Data.com. Retrieved 6 April 2012 from http://www.city-data.com/city/Queens-New-York.html Roleke, J. (2012). Flushing: Queens Neighborhood Profile. The New York Times Company/About.com. Retrieved 6 April 2012 from http://queens.about.com/od/neighborhoods/p/flushing.htm The Economist Newspaper Limited (25 November 2010). Private equity buys into nursing homes: Wall Street goes long on grannies. The Economist. Retrieved 6 April 2012 from http://www.economist.com/node/17581666 US Census Bureau (January 2012). Queens County, New York. US Census Bureau State & County Quick Facts. Retrieved 6 April 2012 from http://quickfacts.census.gov/qfd/states/36/36081.html Wolfram Alpha LLC (2012). Queens County, New York. WolframAlpha.com. Retrieved 6 April 2012 from http://www.wolframalpha.com/entities/us_counties/queens_county,_new_york/nv/gi/j8/ Read More