RCFE Business Case Analysis<br />TOPICS<br /><ul><li>Backgrounder
Objectives
Standards & Requirements
Start-up Operations
Financials</li></li></ul><li>RCFE Business Case Analysis<br />BACKGROUNDER<br />Introduction:<br /><ul><li>Elderly populat...
Elderly population would more than double by this century to 80 million
“Oldest old” (85 yrs and over) is the fastest growing segment
California’s 65-plus population will double by 2020
Number will top 6.6 million compared to 3.3 million in 1993.
Racial and ethnic diversity will increase given the mix in population</li></li></ul><li>RCFE Business Case Analysis<br />B...
RCFE Business Case Analysis<br />BACKGROUNDER<br />Oldest Old<br />The fastest-growing portion of many older populations i...
RCFE Business Case Analysis<br />BACKGROUNDER<br />Facts:<br /><ul><li>Rapid increase in the aging population necessitates...
The need to maintain quality of life for the elderly population is a basic priority among family members.
Work demands among family members prevent them from giving proper care to the senior family members.
Proper care: Safety, companionship, medication and daily living activities.  These are often neglected when elderly is lef...
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Business case analysis

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  • Hi thechadwasgreat,

    Sounds interesting. Nice presentation.

    Where are you planning to put up this RCFE?
    Are you already in operation or in planning stage?

    email me at realestateinvestor88@yahoo.com
    maybe we can help with each other.
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
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Business case analysis

  1. 1. RCFE Business Case Analysis<br />TOPICS<br /><ul><li>Backgrounder
  2. 2. Objectives
  3. 3. Standards & Requirements
  4. 4. Start-up Operations
  5. 5. Financials</li></li></ul><li>RCFE Business Case Analysis<br />BACKGROUNDER<br />Introduction:<br /><ul><li>Elderly population (65 years and over) has increased eleven-fold since mid-1990s.
  6. 6. Elderly population would more than double by this century to 80 million
  7. 7. “Oldest old” (85 yrs and over) is the fastest growing segment
  8. 8. California’s 65-plus population will double by 2020
  9. 9. Number will top 6.6 million compared to 3.3 million in 1993.
  10. 10. Racial and ethnic diversity will increase given the mix in population</li></li></ul><li>RCFE Business Case Analysis<br />BACKGROUNDER<br />An Aging Index<br />Changes in age structure. Ratio of the number of persons aged 60 and over to the number of youths under 15.<br />Over the next 3 decades the aging index is expected to double or triple<br />
  11. 11. RCFE Business Case Analysis<br />BACKGROUNDER<br />Oldest Old<br />The fastest-growing portion of many older populations is the oldest old.<br />Typically constituting only 1 to 2 percent of a population. In North America it is exceeding 5.5 percent.<br />To grow significantly during coming decades.<br />Consuming proportionally greater <br />Amounts of health care.<br />
  12. 12. RCFE Business Case Analysis<br />BACKGROUNDER<br />Facts:<br /><ul><li>Rapid increase in the aging population necessitates the need for elderly-care facilities.
  13. 13. The need to maintain quality of life for the elderly population is a basic priority among family members.
  14. 14. Work demands among family members prevent them from giving proper care to the senior family members.
  15. 15. Proper care: Safety, companionship, medication and daily living activities. These are often neglected when elderly is left alone.</li></li></ul><li>RCFE Business Case Analysis<br />BACKGROUNDER<br />Convalescent or Nursing Home<br />Assisted Living or RCFE<br /><ul><li> Nursing Home beds increased by 7%
  16. 16. RCFE beds increased by 97%
  17. 17. RCFE has 151,000 beds vs 133,000 for Nursing Homes</li></ul>*Source: Medical News Today, Aug. 6, 2005<br />
  18. 18. RCFE Business Case Analysis<br />DEFINING THE BUSINESS<br />What is a Residential Care Facility for <br />The Elderly or RCFE?<br /><ul><li>A facility that offers supportive care to elderly individuals while allowing them a reasonable degree of freedom
  19. 19. Designed for people who need a bit of help with daily life activities
  20. 20. Does not offer skilled nursing care but are staffed by trained caregivers who offer companionship and support
  21. 21. Less costly than a convalescent home or a Skilled Nursing Facility (SNF) </li></li></ul><li>RCFE Business Case Analysis<br />DEFINING THE BUSINESS<br />RCFE…<br />….more like a HOME than a medical facility<br />
  22. 22. RCFE Business Case Analysis<br />CAREHOME BY R.N.s<br />Why Care home by R.N.s?<br /><ul><li>An RCFE manned by caregivers but managed by R.N.s
  23. 23. An RCFE atmosphere with the capability of a Skilled Nursing Facility but without the attendant cost of a nursing home
  24. 24. On-call nurses to ensure prompt attention in case of any medical emergencies
  25. 25. Possesses the capability of handling residents with special medical needs</li></li></ul><li>RCFE Business Case Analysis<br />CAREHOME BY R.N.s<br />A success story…<br /><ul><li>Started operations in 2008 and has now grown into 3 care homes
  26. 26. Each care home has a 6-bed capacity with an 85-100% occupancy rate
  27. 27. Well-trained caregivers who have remained with the company since its early years
  28. 28. Well-entrenched networking among various agencies</li></li></ul><li>RCFE Business Case Analysis<br />INVESTOR OPPORTUNITY<br />2 Ways you can be a business partner<br />One time capital investment of<br />$33,000<br />Property investment <br /><ul><li>Lease @ $2K for 12 mos.
  29. 29. Improvements and renovations - $5K
  30. 30. Furniture and fixture - $4K
  31. 31. Purchase a property for the use of the business</li></li></ul><li>RCFE Business Case Analysis<br />INVESTOR OPPORTUNITY<br />2 Ways you can be a business partner<br />One time capital investment of<br />$33,000<br />Property investment <br />33.33% business ownership<br />
  32. 32. RCFE Business Case Analysis<br />FINANCIALS<br />ASSUMPTIONS<br /><ul><li> Average monthly facility fee - $3,700.
  33. 33. Three (3) caregivers per day, including nightshift
  34. 34. Daily wage per caregiver - $70.00
  35. 35. Rented facility at $2,000 per month
  36. 36. Operating expenses at full costing
  37. 37. Capital Expenditures - $33,000</li></li></ul><li>RCFE Business Case Analysis<br />FINANCIALS<br />
  38. 38. RCFE Business Case Analysis<br />START-UP TIMELINE<br />1<br />2<br />3<br />4<br />5<br />
  39. 39. RCFE Business Case Analysis<br />FINANCIALS<br />SOURCE OF REVENUE<br />Mainly generated from the Monthly Service Facility fees of the “residents” or elderly:<br /><ul><li>SSI Benefits
  40. 40. Voluntary 3rd party contributions
  41. 41. Private Revenue</li></li></ul><li>RCFE Business Case Analysis<br />INVESTOR OPPORTUNITY<br />Key considerations in establishing and running an RCFE facility.<br /><ul><li>Quality of Care </li></ul> - Availability of RNs<br /> - Well motivated and trained staff<br /><ul><li>Marketing efforts</li></ul> - Consistent and aggressive marketing campaign <br /> - Strong networking with various agencies<br /><ul><li> Choosing the right property </li></ul> - Location<br /> - RCFE enabled or a previously run RCFE home <br /> - Offering full amenities<br />
  42. 42. RCFE Business Case Analysis<br />FINANCIALS<br />SOURCE OF REVENUE<br />Mainly generated from the Monthly Service Facility fees of the “residents” or elderly:<br /><ul><li>SSI Benefits</li></ul> …a supplemental security income which is a needs-based program for those whose earnings have been low in recent years.<br />
  43. 43. RCFE Business Case Analysis<br />FINANCIALS<br />SOURCE OF REVENUE<br />Mainly generated from the Monthly Service Facility fees of the “residents” or elderly:<br /><ul><li>SSI Benefits
  44. 44. Voluntary 3rd party contributions</li></ul>…additional income on top of SSI benefits to fully cover for monthly facility fees.<br />
  45. 45. RCFE Business Case Analysis<br />FINANCIALS<br />SOURCE OF REVENUE<br />Mainly generated from the Monthly Service Facility fees of the “residents” or elderly:<br /><ul><li>SSI Benefits
  46. 46. Voluntary 3rd party contributions
  47. 47. Private Revenue</li></ul>…income derived in full from the residents personal funds.<br />
  48. 48. RCFE Business Case Analysis<br />BUSINESS RISK ANALYSIS<br />Downside<br /><ul><li>Quality intensive care needed
  49. 49. Possibility of negligence among staff
  50. 50. Need for quick marketing efforts
  51. 51. Availability of relievers</li></ul>Upside<br /><ul><li>A growing market base seen to double in the next 5 years
  52. 52. Cost to Revenue is relatively smaller
  53. 53. Target market has financial capacity to pay
  54. 54. Cash Revenue, no AR, no inventory
  55. 55. Low capital. Easy exit strategy.
  56. 56. Low maintenance business
  57. 57. Affordable labor cost</li>

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