Proposing A New Initiative

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Executive Brief: Proposal of New Economic Opportunity

Learner’s Full Name

School of Nursing and Health Sciences, Capella University

NURS-FPX6008: Economics and Decision Making in Health Care

Instructor’s Name

Month, Year

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Executive Brief: Proposal of New Economic Opportunity

The primary objective of Whilborne Medical Center (WMC) has always been to deliver

high-quality health care to the community. The medical center can take a step further in that

direction by setting up a new urgent care center (UCC) within its premises. A UCC is a health

care facility that provides immediate care, without a scheduled appointment, for injuries and

illnesses that are not life-threatening and do not require admission to the emergency department

(ED). The key characteristics of a UCC are reduced wait times, increased service hours, reduced

costs, and quick service (Chang et al., 2015).

WMC is located in an area that has around 3,000 locals whose urgent care needs may be

met by the UCC. Additionally, WMC, being located near Maxima Industrial Park, receives a lot

of cases of work-related injuries (e.g., minor burns, sprains, cuts, and abrasions) and other minor

illnesses (e.g., fever, headache, ear infection, abdominal pain, and respiratory illnesses) that

require immediate attention. Currently, such cases are handled by the medical center’s ED,

which leads to overcrowding and reduced efficiency. Once the UCC is set up, such cases can be

diverted to the UCC to ease the burden on the ED at the medical center.

Outcomes of Starting an Urgent Care Center

WMC has always strived to focus on the six areas of health care quality—timeliness,

safety, patient-centeredness, efficiency, equity, and effectiveness—stated by the Institute of

Medicine (IOM). Setting up a UCC will help the medical center achieve its vision of improving

community health and delivering superior health care, irrespective of patients’ cultural

background, age, gender, and socioeconomic status (Agency for Healthcare Research and

Quality, 2016).

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The new line of service will be convenient for patients with noncritical conditions that

require immediate attention. They will not have to wait for several hours as they do at the

medical center’s ED. They will be able to walk in without an appointment and avail after-hours

health care services on all days of the week. Setting up a UCC will help the ED concentrate on

critical, life-threatening medical cases; it will also improve the efficiency of the ED and the

quality of care provided to patients (Qin et al., 2015).

Expenses on technology and infrastructure are comparatively low for setting up the UCC.

Consequently, the cost of health care services provided at the UCC will be low in comparison to

the cost of health care services at the ED of the medical center. Moreover, a UCC is an

affordable means of availing health care services for noncritical ailments (Qin et al., 2015). This

makes it an economically viable health care solution for the neighborhood. With its services, the

UCC will generate additional revenue for the medical center.

Although setting up a UCC has several positive outcomes, it has some negative

outcomes, too. One of the drawbacks of getting treated at a UCC is that patients are likely to get

care from different physicians every time they visit the UCC. This may result in the physicians

not knowing their patients’ personal or family health history, and the patients may not receive the

same quality of care they receive at their primary care physician’s office. In addition, although

wait times at UCCs are shorter than at EDs, patients could end up waiting longer than when they

would see their primary care physician with an appointment on days that the UCCs have high

footfall. Also, more staff may have to be hired at the UCC, which will entail additional costs for

the medical center.

Factors Influencing the Setting up of an Urgent Care Center

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A UCC is a volume-driven business that is dependent on many economic and

environmental factors. Environmental data suggests that WMC is a reputed medical center in the

area and there are few health clinics in the vicinity. The walk-in facility at the UCC and its

proximity to Maxima Industrial Park will make it a preferred option for employees working at

the industrial park. As the industrial park consists mainly of manufacturing units, there is a high

possibility of work-related injuries. Therefore, the UCC can expect a high number of visits from

these employees. Also, most employees at these companies work in shifts and sometimes on

weekends. This is a great opportunity for the UCC as it plans to offer health care services even in

the evenings and on weekends.

The capital cost of the project is estimated to be $350,000. It will include the cost of

construction, equipment, and furniture. There will be no land cost because the UCC will be built

within WMC’s premises. One half of the required funds will be procured through a bank loan;

the other half will be funded using the medical center’s reserves. It is assumed that an average of

357 patients will visit the UCC every week and the consultation fee for each patient will be

around $156 (AMN Healthcare, 2015; Yakobi, 2017). Calculations suggest that the UCC will

record a cash surplus in the first five years. This illustrates that starting a UCC will be an

economically viable opportunity for the medical center.

Analysis of Supply and Demand for the Urgent Care Center

Aside from the 3,000 locals in the area who might benefit from the UCC at WMC, there

is a large client base at the industrial park located near the center. Maxima Industrial Park

comprises 10 companies, each having an employee strength of 2,000–3,000 individuals. In all,

about 30,000 employees work here. There are just two primary health clinics and a retail health

clinic around the industrial park, and WMC is the only multispecialty medical center located

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within a 5-mile radius. Therefore, there are not enough facilities in the vicinity to cater to the

medical needs of employees working in the industrial park, creating a supply–demand gap.

Being the only multispecialty medical center near the industrial park, WMC receives a lot

of cases pertaining to work-related injuries and minor illnesses that require immediate attention.

This overloads the ED of the medical center with noncritical cases and hinders it from being able

to focus on patients admitted for treatment of critical, life-threatening diseases. Establishing a

UCC within WMC’s premises will contribute toward bridging the supply–demand gap without

compromising on the quality of health care delivered.

While analyzing the data pertaining to the supply and demand for the proposed UCC,

areas of uncertainty have been identified. The successful implementation of this proposal would

depend on receiving timely approval of the planned bank loan and approval from the board of

directors of the medical center to allocate funds to support this proposal. Another area of

uncertainty is the level of awareness of UCCs in the neighborhood. Therefore, there may be a

need to create awareness of the functions and necessity of a UCC. Patients may not want to avail

services at the UCC because of their lack of awareness, and this might negatively impact revenue

estimates.

Conclusion

Setting up a UCC will reduce the burden on the ED at WMC, making it more efficient.

Patients will receive accessible, high-quality, affordable care without a scheduled appointment,

and they will benefit from the after-hours care. Also, the UCC will bring in additional revenue

for the medical center and help acquire new patients. Therefore, setting up a UCC within

WMC’s premises will be a lucrative economic opportunity.

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References

Agency for Healthcare Research and Quality. (2016). The six domains of health care quality.

https://ahrq.gov/professionals/quality-patient-

safety/talkingquality/create/sixdomains.html

AMN Healthcare. (2015). Convenient care: Growth and staffing trends in urgent care and retail

medicine.

https://amnhealthcare.com/uploadedFiles/MainSite/Content/Healthcare_Industry_Insights

/Industry_Research/AMN%2015%20W001_Convenient%20Care%20Whitepaper(1).pdf

Chang, J. E., Brundage, S. C., & Chokshi, D. A. (2015, July 23). Convenient ambulatory care —

Promise, pitfalls, and policy. The New England Journal of Medicine, 373(4), 382–388.

Qin, H., Prybutok, G. L., Prybutok, V. R., & Wang, B. (2015). Quantitative comparisons of

urgent care service providers. International Journal of Health Care Quality Assurance,

28(6), 574–594.

Yakobi, R. (2017). Impact of urgent care centers on emergency department visits. Health Care:

Current Reviews, 5(3). http://dx.doi.org/10.4172/2375-4273.1000204