Connect With A Child – Women’s and Children’s...

12/1/2014

Connect With A Child – Women’s and Children’s Hospital Organizational Plan

Tom Abungu and Gregory Dunn, MD CONNECT WITH A CHILD

UNIVERSITY OF TENNESSEE – PEMBA 2014 ADVISOR: DON CLARK

Gregory Dunn 1 12/1/2014

Table of Contents Executive Summary ....................................................................................................................................... 3

The Kenyan Healthcare Industry ................................................................................................................... 4

Market Analysis ............................................................................................................................................. 4

Overview ................................................................................................................................................... 4

Demographic ............................................................................................................................................. 4

Economic ................................................................................................................................................... 5

Political ...................................................................................................................................................... 5

Force Field Analysis ................................................................................................................................... 6

Survey results of Siaya Residents .............................................................................................................. 8

Figure 1 – Cumulative Survey of Siaya County Residents ..................................................................... 8

Figure 2 – Survey of Siaya county leaders, physicians, nurses and teachers - ..................................... 9

Competitive Analysis ..................................................................................................................................... 9

Figure 3 – Competitive Structure Analysis .......................................................................................... 11

Marketing Plan ............................................................................................................................................ 12

Marketing to Financial Benefactors ........................................................................................................ 12

Marketing to Patients ............................................................................................................................. 12

Management Plan ....................................................................................................................................... 13

Overview ................................................................................................................................................. 13

Board of Directors ................................................................................................................................... 14

Committee Assignments ......................................................................................................................... 15

Operating Plan ............................................................................................................................................ 15

Overview ................................................................................................................................................. 15

Timeline................................................................................................................................................... 15

Staffing .................................................................................................................................................... 16

Figure 4 – Proposed Staffing Model (USD) ......................................................................................... 16

Building ................................................................................................................................................... 16

Equipment ............................................................................................................................................... 17

Ancillary Services .................................................................................................................................... 17

Figure 5 – Anticipated patient volume and charges ........................................................................... 18

Financial Plan .............................................................................................................................................. 19

Facility initial capital funding .................................................................................................................. 19


Facility sustainment funding ................................................................................................................... 19

Cost Structure ......................................................................................................................................... 19

Proforma Income Statement .................................................................................................................. 20

Proforma Statement of Cash Flows ........................................................................................................ 20

Proforma Balance Sheet ......................................................................................................................... 20

Conclusions ................................................................................................................................................. 21

Appendix 1 – Tentative Hospital Design ..................................................................................................... 22

Appendix 2 – Survey used to interview Siaya residents ............................................................................. 23

Appendix 3 – Location of Hospital within Kenya ........................................................................................ 24

Appendix 4 – Cumulative Survey of Siaya County Residents ...................................................................... 25

Appendix 5 – Survey of Leaders within Siaya County ................................................................................. 26

Appendix 6 – IMEC Equipment Cost Estimate ............................................................................................ 27

References .................................................................................................................................................. 28

Abbreviations .............................................................................................................................................. 28

Slide Presentation ....................................................................................................................................... 29


Executive Summary

Connect With A Child is a dynamic and rapidly growing, not-for-profit Christian organization

which reaches out to the poorest of Kenyan children. Our existing partnerships with individuals

and churches throughout the world have enabled us to provide Christian education, food, and

shelter to more than 300 children in need. Our success within Siaya County spurred a generous

individual to donate land for the purposes of building a hospital. With this donation and

through our research, we have discovered a substantial, unmet need for quality obstetrical and

pediatric medical care within Siaya County.

Kenyans are needlessly suffering through malnutrition, disease, and injury. One out of 11

children in Siaya county dies before the age of 1 (http://medicine.unm.edu/globalhealth/, n.d.).

HIV/AIDS is rampant in Siaya county residents, and resources are limited. With the government

of Kenya facing significant financial difficulty, the funds to establish a hospital are non-existent.

Women and children face the brunt of struggles within Kenya; gender equality issues, high

death rates, and daily financial struggles result in mothers and their children frequently working

long hours, making them unable to improve their futures through education. Siaya County’s

high maternal death rate creates numerous orphans who must beg for daily necessities.

By improving maternal and pediatric health, we aim to mitigate burdens generated by poor

health within Siaya County and create opportunities to share the love of God. With this goal as

our inspiration, we have developed a cost-efficient, targeted business plan to build a Women

and Children’s Hospital within the town of Udenda in Siaya County. Initial funding for this

hospital will be established through the generous donations of our international partners.

Hospital sustainment funding will be generated from a staggered billing system with service line

differentiation. By creating private rooms and additional amenities, we aim to attract clientele

who are willing to pay higher rates for a personal medical care experience. Segmentation of

care within our facility will generate additional revenue necessary to meet our organizational

budgetary requirements and allow us to touch individuals across all socioeconomic classes.

Connect With A Child Women’s and Children’s Hospital (CWACWCH) will maintain judicious and

honest financial accountability, with an organizational structure including a board of directors

who will be instrumental in financial oversight. Intelligent efficiency will be paramount in

ensuring that our partners’ generous contributions are maximized to their full benefit. As the

project advances, necessary partnerships will be generated with external organizations that

share CWACWCH goals. By partnering with CWACWCH today, individuals will have the

potential to invest in Africa’s future and share the love of God with the Siayan community.


The Kenyan Healthcare Industry

Kenyan Healthcare is delivered by a mix of government-run hospitals; not-for-profit, faith-based

hospitals; and for-profit hospitals. The for-profit hospitals are mainly clustered within the large

cities. In many hospitals, care is only delivered if the patient has proof of insurance or cash-in-

hand. Delays in healthcare occur if proof of payment is not available—regardless of the

severity of injury or illness. There is no social healthcare safety net within Kenya although some

of the government-run hospitals will provide subsidized care. Advanced technologies, such as

CT scanners, are mainly limited to large hospitals in metropolitan areas. Not-for-profit centers

are believed by many Kenyans to offer better care to their patients. Kenya has eight provincial

hospitals that provide advanced ICU-level care and two national hospitals which provide full-

service specialty care. Infectious disease and trauma are the major causes of death within

Kenya. Healthcare insurance coverage is available in Kenya, and medicines are provided by the

government free-of-charge to hospitals.

Market Analysis

Overview

Siaya County is a poverty stricken region with high HIV/AIDS rates, high birth rates, high

childhood death rates, and low access to medical care. It is also a region with endemic malaria,

which further complicates healthcare delivery. Healthcare delivery consists of a mixture of

government-owned hospitals and small regional care centers. Quality of care varies

extensively, and the majority of would-be patients seek care over an hour away in Kisumu.

Dependable pediatric and obstetrical care would offload the main county hospital and decrease

access to care difficulties.

Demographic

Connection Women and Children’s Hospital will be based in Udenda within Siaya County,

Kenya. Udenda is located within western Kenya adjacent to Lake Victoria (Appendix 3). The

region has an infant mortality rate of 95/1000 births and a maternal HIV rate of 40 percent

(http://medicine.unm.edu/globalhealth/, n.d.). Malaria is endemic to this region, and hospitals within

this region are overcrowded and possess limited capabilities. The proposed obstetrical and

pediatric hospital would immediately serve 41,564 people; but as service capabilities improve,

the hospital potentially could care for a referral area of more than 200,000 people (www.opendata.go.ke/, n.d.).

Kenya’s children face many substantial challenges. Seventy-five percent of Kenya’s 29 million

people are under the age of 30 (World Bank, n.d.). Secondary school is not paid for by the

government, and enrollment is only 23.5 percent within Siaya (World Bank, n.d.). Primary school is

free; however, parents are responsible for children’s uniforms, food, and health care. This puts


a substantial financial burden on parents, and unexpected expenses are challenging for families

to pay. Forty percent of children work more than 41 hours per week with approximately 50

percent of children contributing more than 50 percent of the household income (World Bank,

n.d.). This is partially due to the high parental death rate from HIV/AIDS. Of the 7.7 to 10.6

percent of children who report that they participated in commercial sex, 15 - 16 percent

reported that they began this work for money (World Bank, n.d.). One in ten Kenyan women have

attempted suicide, and in 2002 approximately 24 percent of 15 - 24 year olds were HIV positive.

These statistics, along with rapid population growth, point to the tremendous need for

improved healthcare delivery and infrastructure for Kenyan mothers and children.

Economic

Siaya County has some economic growth possibilities, but growth has been stagnated by

political corruption and civilian unrest. While there is potential for agricultural and industrial

projects to improve the economic conditions in this region, the poorest residents do not work

within these industries and continue to live off subsistence farming. Many Kenyans possess

one or two cows, a few chickens, and a small plot of land, and much of the growing industry

does not improve the lives of these local Kenyans. Rather, college-educated Kenyans are

brought in from Nairobi to staff many of the regional positions. In addition to the above

hurdles, Siaya County has limited broadband capability, poor roads, and a temperamental

electrical grid. Tourism was previously a strong industry that has been substantially weakened

by violence and Somalian terrorism.

Political

Kenya’s current president, Uhuru Kenyatta, was accused of ethnic violence in 2007 during an

election. As a result, President Kenyatta has been referred to the International Criminal Court

for prosecution, and this ongoing issue has dampened Kenya’s standing on the world stage.

The surrounding violence resulted in the deaths of more than 1,000 people and displaced an

estimated 600,000 people (CBS News, 2008). The stable reputation that Kenya had within Africa

was harmed and has resulted in a drop in tourism (Daily Nation, 2014). Kenya has further damaged

its international reputation regarding human rights with worsening policies involving gender

and racial equality.


Force Field Analysis

Positive Forces

Demographic

o Siaya infant death rate of 95/1000

(World Bank, n.d.), maternal HIV rate of 40% and overcrowded government hospitals validate growth potential.

(http://medicine.unm.edu/globalhealth/, n.d.)

o Kenya’s youth literacy rate of 93% improves chances for sustained healthcare improvements.

(www.unicef.org, 2014)

o Number of physicians increased 31% between 2002 and 2009. (Dogbey, 2012)

o Hospital would serve a community of 45,000 with a population density of 290 people/km2. (www.opendata.go.ke/, n.d.)

Socio-Cultural

o Siaya County is 80% Luo people which is a group with strong social and political unity. (www.kwaho.org, n.d.)

Political

o The Luo people are the third largest ethnic group (13%) in Kenya and they are the second most politically influential behind the current Kikuyu government. (Country Profile: Kenya,, June 2007)

o Between 2008 and 2013 the prime minister of Kenya was Luo, and improvements in roads and infrastructure were realized in Siaya.

Negative Forces

Demographic

o Less than 1 physician per 100,000 patients in rural areas of Kenya. (Soucat, Scheffler, & with Tedros Adhanom Ghebreyesus, 2013)

o 42% of the population in Kenya is less than 14 years old, and life expectancy is only 61 years.

o 59% of available government physician positions are unfilled. (Dogbey, 2012)

o 54% of rural Kenya population has access to clean drinking water, and 29% have access to sanitation facilities. (www.cia.gov/library/publications/the-world-factbook/geos/ke.html, n.d.)

Socio-Cultural o Kenyan law passed in March 2014

legalizes polygamy and is of significant concern to women’s rights. (Leposo, 2014)

Political

o Current president is undergoing trial International Criminal Court related to sectarian violence. A guilty verdict may limit international aid. (Q&A: Kenyan

leaders at The Hague (www.bbc.co.uk), n.d.)

o The Kikuyu people currently control

government and are the main

political rivals of Luo people. There

is a history of politically-related

violence (2007) against Luo people.


Economic o Projected economic growth rate of

5% in 2014. (World Bank, n.d.)

o World Bank and IMF have resumed loaning money to Kenya after a corruption scandal in 2006.

o Industrial Production growth rate of 4.6%. (www.cia.gov/library/publications/the-world-

factbook/geos/ke.html, n.d.)

o The Nairobi Securities Exchange has a history of stability and is the most advanced market in the region.

(Kimenyi & Kibe, 2014)

Technology o Innovative wireless insurance

payment system is in place which increases low income patient access and healthcare reimbursement.

(changamka.co.ke, n.d.)

Geographical o Siaya county borders Lake Victoria

and its waters are used in trade, irrigation, and fishing.

o Siaya county’s annual rainfall is between 800-1600mm which is substantially greater rainfall than the 80% of Kenya that is arid and semi-arid (<800mm).

(www.siayacounty.com/environment.php, n.d.)

o Unique topography and diverse wildlife have the potential to improve Kenya’s tourism industry.

Economic o Poverty rate of 40% in Siaya versus

22% in Nairobi. (World Bank, n.d.)

o Unemployment rate in Kenya is 40%.

(www.cia.gov/library/publications/the-world-factbook/geos/ke.html, n.d.)

o Inflation rate for Kenya in 2012 was 9.4% (World Bank, n.d.)

o 78.5% of urban population are in the highest wealth quintile, versus 12.3% in Nyanza region where Siaya County is located. (Dogbey, 2012)

Technology o Electrical grid has a history of

frequent blackouts.

o No access to broadband internet: limited ability to teleconference and utilize medical research (Draft: The

National Broadband Strategy for Kenya, 2013)

Geographical o Only 17% of total land area has

agricultural potential; however, 24% of GDP is from agriculture.

o Siaya County’s proximity to rivers and to Lake Victoria increase mosquito population and result in high rates of malaria infections.


Survey results of Siaya Residents

A total of 51 Siaya county residents were interviewed by Tom Abungu and his team (Appendix

2). Originally the survey was designed to be administered as an interview; but, instead, the

participants completed the survey by hand. The survey was not blind; however, due to the type

of question asked, we believe the information obtained adequately reflects trending ideas

within the community. Of the 51 surveys completed, 19 people surveyed were leaders in the

community. This subgroup consisted of physicians, teachers, nurses, and political leaders. We

wanted to verify that the regular citizen and the community leader had similar opinions

regarding a potential future hospital. The survey was also designed to assist in recognizing

community needs and to determine what service lines our hospital would provide.

Figure 1 – Cumulative Survey of Siaya County Residents - See Appendix 4

As illustrated by Figure 1, the majority of Siaya residents feel strongly about the need for both

pediatric care and obstetrical care. There also appears to be support for a new hospital and a

general opinion that the current local hospitals do not provide excellent care. Infectious

disease care is also a perceived need and, most interestingly, the survey results suggest that

paying money for high quality care would be expected. We are encouraged by these survey

results. Our decision to pursue pediatric and obstetrical service lines were substantially

influenced by these surveys, as well as WHO/World Bank demographic analysis. Ultimately our

own internal survey corroborates information obtained through demographic information

obtained through WHO/World Bank.


Figure 2 – Survey of Siaya county leaders, physicians, nurses and teachers - See Appendix 5

After separating out the leaders from the general respondents of our Siaya county survey, we

feel that the majority of opinions showed similar trends. It is interesting to see that a greater

percentage of community leaders believed that local hospitals are providing excellent care.

This is expected since many of the leaders within this survey worked for these local hospitals.

Other than this question, our conclusions remained the same with both the cumulative survey

and the survey of Siaya leaders, healthcare workers, and teachers. It is encouraging that the

different groups both feel strongly about the requirement for a new hospital and agree about

Siaya County’s healthcare needs.

Competitive Analysis

The four hospitals listed below in the competitive analysis suffer from severe overcrowding and are perceived partners rather than competitors. Since the majority of care in Siaya is through government-sustained hospitals, it is essential that we excel in quality and perceived quality of care. This will allow us to capture patients who are able to pay and will improve our long-term sustainment.

The only hospital that can be viewed as a direct competitor below would be Siaya District Hospital (SDH). Within SDH, many patients share beds and some women are discharged less than a day after childbirth. SDH provides obstetrical care, general surgical care, medical care,


and pediatric care. It does not have neurosurgical, advanced ENT, advanced orthopedics, or advanced urological care. As noted, this hospital is our largest direct competitor and faces substantial overcrowding.

Siaya District Hospital o Largest hospital in region with 240 beds o Known service lines: surgical and nonsurgical maternity care, HIV care, pediatric

ward, general surgery, malaria treatment, nutrition, immunization, outpatient medicine

o Distance from Udenda – 11 miles

Bondo District Hospital o 49 beds o Known service lines: family planning, surgical and nonsurgical maternity care,

HIV care, malaria treatment, nutrition, pediatric ward o Distance from Udenda – 24 miles

Ambira Sub-District Hospital o 50 beds o Known service lines: family planning, HIV care, outpatient care, nutrition, malaria

treatment o Distance from Udenda – 12 miles

Uradi Mission Hospital o 18 beds o Very limited capabilities o Nurse-delivered care o Distance from Udenda – 1.5 miles


Figure 3 – Competitive Structure Analysis

Kenyan Healthcare Education Pharmaceutics

Critical Access Hospitals

<30km from Udenda

town, Siaya county

Dispensaries Medical

Centers

Referral

Hospitals

Specialty

Hospitals

Critical

Access

Hospitals

Government

Owned Non-Profit/Charity

Healthcare

Facilities

Kenyan healthcare

facilities >30km from

Udenda town, Siaya county

Siaya

District

Hospital

Bondo

District

Hospital

Ambira

Sub- District

Hospital

Proposed

Udenda

Hospital

Uradi Mission

Health Centre

Brand Product

sub-subtype

Generic

Product

Product

type

Outpatient

Facilities

Inpatient

Facilities

Product

subtype

Product sub-

sub-subtype


Marketing Plan

Connect With A Child Women and Children’s Hospital will need to market its services to two

distinct entities: patients and financial benefactors.

Marketing to Financial Benefactors

To build a self-sustaining, community hospital we must ensure the hospital’s initial endowment

is adequate to cover the initial building costs, to fully equip the hospital and to sustain

operations without encountering a short term cash-flow crunch. Developing a shared vision

with potential benefactors is essential. Historically, Connect With A Child has raised funds

through churches and through individual church members. Raising money in this way will

remain instrumental to our success; however our organization anticipates establishing

corporate and potentially governmental partnerships to ensure we meet our fundraising needs.

Early in the fundraising process CWACWCH will network with organizations such as Samaritan’s

Purse to ensure our business plans, organizational goals and funding outlooks are consistent

with historical projects and to identify and mitigate knowledge gaps in our planning process.

The first step in marketing to benefactors is to establish assurances that donated money will be

administered honestly, economically and effectively within our organization. Creating

partnerships with well-respected organizations will ensure that future benefactors are

confident in CWACWCHs mission and capabilities. All money raised for this project will be

maintained by Connection Church (Oregon City, OR). These funds will remain transparent with

financial records accessible to any fundraising partner.

As a non-denominational, Christian organization, CWACWCHs sole purpose is to share God’s

love by caring for those in need. Our hospital will be open to any international volunteers who

share this purpose. CWACWCH will maintain its support network through monthly newsletters,

blogs and direct communication with instrumental individuals. Establishing and sustaining this

our network with like-minded individuals will be critical to meeting our staffing and fundraising

needs.

Finally, CWACWCH desires to establish partnerships with corporate and governmental

organizations. To establish these networks a strict organizational structure, precise financial

planning and disciplined administrative oversight is important. Since CWACWCH is a new

entrant in the non-profit charity hospital market, remaining open to external input from

partner organizations will strengthen our financial foundation and ensure the longevity of our

hospital.

Marketing to Patients

Creating compelling service which attracts Kenyans to our hospital is essential to future hospital

stability. It is essential that initial planning steps focus on providing world class care that is


affordable. We will need to identify high quality, Kenyan physicians who can partner with

volunteer international medical providers to develop a health care system that focuses on

quality. Spearheading an aggressive early approach to establish a strong, safe hospital culture

will be essential for our organization’s reputation. Only through establishing a reputation for

high quality care at the start can we ensure CWACWCH succeeds financially and

organizationally.

Early marketing strategies should focus on two different areas; creating awareness and enticing

wealthier Kenyans. Our marketing survey has already established there is tremendous demand

for our services. Creating awareness of our hospital will be the first step to ensure we have

adequate case volume to support our service. Awareness will be established through fliers,

school networking and word of mouth. Linking up with community leaders and communicating

our organizational needs will also be important for increasing community awareness.

Since we are offering a premium service line with private rooms we need to ensure our

reputation for service starts early and is maintained. Encouraging wealthier Kenyans to utilize

our private rooms will ensure financial stability in future years. It may be necessary to develop

unique marketing strategies to entice these customers to utilize our facility. Additional tailored

marketing approaches and research will be undertaken closer to hospital completion to ensure

our services meet premium criteria.

Management Plan

Overview

Connect With A Child Women and Children’s Hospital (CWACWCH) will be managed by a chief

executive officer overseen and elected by a majority vote by the board of directors. There will

also be an executive committee elected by majority vote who will act locally on the board’s

behalf. The executive committee’s organization will be solely determined by the board of

directors.

The board members’ terms will be lifetime positions. Members may remove themselves

voluntarily from the board of directors at any time. There are no financial benefits or incentives

to be a CWACWCH board member. To remove a board member from the board of directors

will require a two-thirds vote of the board of directors. A chairman will be elected by the board

of directors with a simple majority vote.

This hospital will be not-for-profit and will be affiliated with Connect With A Child. CWACWCH,

for legal purposes, will be a separate and unique organization from Connect With A Child.

CWACWCH is a Christian charity organization based in Kenya with offices in the United States.


Our board of directors shall consist of dedicated, committed Christians with experience in

healthcare delivery, organizational leaders, or those who are influential members within the

local community.

Board of Directors

1. Tom Abungu, KENYA 2. Anna Abungu, KENYA 3. Jerry Weggener, Oregon City, OR 4. Hillary Abungu, KENYA 5. Jared Odhiambo, KENYA 6. Greg Dunn, Knoxville, TN

7. Zach Grafe, RioRancho/Abq, NM 8. Stephanie Jensenm, Ruidoso, NM 9. Evans Okeyo, Ruidoso, NM 10. Jacque Ochieng, KENYA 11. Pastor Dan Oketch, Kenya 12. Evelyn Osse, Kenya

https://www.facebook.com/jacque.ochieng?hc_location=timeline


Committee Assignments

Connect with a Child will have, at least, the following three committees:

1. Governance Committee

2. Audit Committee

3. Finance Committee

Every board member should serve on at least one, but preferably no more than two,

committees. Members will be appointed by the chairman in consultation with the Governance

Committee. Committee size will depend on the needs of the board and the needs of the

organization, depending upon a given committee’s workload. Each board member should make

a commitment to actively participate in the work of their assigned committee.

Operating Plan

Overview

CWACWCH will have a ward with private rooms and more personalized service to cater to

individuals who have the ability to pay or have medical insurance. The hospital will also have a

separate pediatric ward and obstetric ward that has dividing curtains to provide medical care

for those who are less able to pay. By offering a two-tiered service model we can utilize our

higher revenue product line to financially supplement our mission to provide care for the

medically underserved in Kenya. We anticipate this two-tiered model to provide a greater level

of self-sustainment and improved growth.

Service lines offered at CWACWCH will be gynecological, women’s general and pediatric

surgical care as well as surgical and non-surgical obstetric care. CWACWCH will emphasize

standard, evidence-based medicine and will have some degree of medical oversight by

physicians from supporting countries. CWACWCH will actively recruit international and

domestic medical volunteers to ensure the hospital has exposure to diverse medical practices

which emphasize high quality.

Timeline

1/1/2015 6/1/20156/1/2015 6/1/20166/1/2016 1/1/20171/1/2017 1/1/2018

1/1/2015 - 5/31/2015

Fundraising Strategy / Networking

6/1/2016 - 1/1/2017

Fundraising

1/1/2018 3/1/2018

1/1/2018 - 3/1/2018

Recruitment / Hospital Equipment

1/1/2017 - 1/1/2018

Fundraising / Hospital Building

6/1/2015 - 6/1/2016

Fundraising / Grant Development

As a key project of Connect With A Child, CWACWCH will start active fundraising in the summer of 2015.

Initial grant development/grant exploration will start at this time and our key ministry partners will be


contacted to explore early fundraising partners. Depending upon the level and types of grants received

CWACWCH will move into targeted fundraising by visiting ministry partners. Depending upon the status

of funds we will start construction of the hospital in January of 2017 with anticipated completion in early

2018. We anticipate approximately 3-4 months will be required for equipping the hospital and this time

will be used for staff recruitment.

Staffing

CWACWCH will predominantly be staffed by Kenyan-born and Kenyan-trained physicians. The

majority of the leadership and administrative structure will be Kenyan led. Physicians with

broad knowledge will be recruited as reflected in our proposed staffing model in Figure 4.

Figure 4 – Proposed Staffing Model (USD)

Building

Connect With A Child currently owns two acres of land within Udenda. This land has an

adequate well in place previously built by Connect With A Child. An additional, adjacent three

acres of land is available for purchase for approximately 3,000 USD. The building will have

three wings. The current design allows for two floors and is anticipated to cost approximately

2016

Employee

Cost

2016 Sa laries

2017

Employee

Cost

2017 Sa laries

2018

Employee

Cost

2018 Sa laries

2019

Employee

Cost

2019 Sa laries

2020

Employee

Cost

2020 Sa laries

Adminis trator 1 1 1 1 1

Adminis trator Cost 800.00$ 800.00$ 824.00$ 824.00$ 848.72$ 848.72$ 874.18$ 874.18$ 900.41$ 900.41$

Pediatrician 1 2 2 2 2

Pediatrician Cost 1,600.00$ 1,600.00$ 1,648.00$ 3,296.00$ 1,697.44$ 3,394.88$ 1,748.36$ 3,496.73$ 1,800.81$ 3,601.63$

OB/GYN 1 1 2 2 2

OBGYN Cost 1,800.00$ 1,800.00$ 1,854.00$ 1,854.00$ 1,909.62$ 3,819.24$ 1,966.91$ 3,933.82$ 2,025.92$ 4,051.83$

General Practice 3 3 3 3 3

General Practice Cost 1,600.00$ 4,800.00$ 1,648.00$ 4,944.00$ 1,697.44$ 5,092.32$ 1,748.36$ 5,245.09$ 1,800.81$ 5,402.44$

Surgeon 1 1 1 1 1

Surgeon Cost 1,800.00$ 1,800.00$ 1,854.00$ 1,854.00$ 1,909.62$ 1,909.62$ 1,966.91$ 1,966.91$ 2,025.92$ 2,025.92$

Nurse 9 9 10 10 10

Nurse Cost 678.00$ 6,102.00$ 698.34$ 6,285.06$ 719.29$ 7,192.90$ 740.87$ 7,408.69$ 763.09$ 7,630.95$

Nurse Ass is tant/Surgica l Ass is tant 5 6 7 7 7

NA/SA Cost 378.00$ 1,890.00$ 389.34$ 2,336.04$ 401.02$ 2,807.14$ 413.05$ 2,891.36$ 425.44$ 2,978.10$

Secretary 2 2 2 2 2

Secretary Cost 350.00$ 700.00$ 360.50$ 721.00$ 371.32$ 742.63$ 382.45$ 764.91$ 393.93$ 787.86$

Pharmacis t 1 1 1 1 1

Pharmacis t Cost 1,200.00$ 1,200.00$ 1,236.00$ 1,236.00$ 1,273.08$ 1,273.08$ 1,311.27$ 1,311.27$ 1,350.61$ 1,350.61$

Pharmacis ts ass is tant 2 2 3 3 3

Pharmacis t asst cost 250.00$ 500.00$ 257.50$ 515.00$ 265.23$ 795.68$ 273.18$ 819.55$ 281.38$ 844.13$

Lab Technician 3 4 4 4 4

Lab Tech Cost 250.00$ 750.00$ 257.50$ 1,030.00$ 265.23$ 1,060.90$ 273.18$ 1,092.73$ 281.38$ 1,125.51$

Cook 2 3 4 4 4

Cook Cost 172.00$ 344.00$ 177.16$ 531.48$ 182.47$ 729.90$ 187.95$ 751.80$ 193.59$ 774.35$

Housekeeping 5 5 5 5 5

Housekeeping Cost 172.00$ 860.00$ 177.16$ 885.80$ 182.47$ 912.37$ 187.95$ 939.75$ 193.59$ 967.94$

Guards 3 3 4 4 4

Guard Cost 215.00$ 645.00$ 221.45$ 664.35$ 228.09$ 912.37$ 234.94$ 939.75$ 241.98$ 967.94$

Nurse Midwife 4 4 5 6 6

Midwife Cost. 600.00$ 2,400.00$ 618.00$ 2,472.00$ 636.54$ 3,182.70$ 655.64$ 3,933.82$ 675.31$ 4,051.83$

Total Monthly Cost 26,191.00$ 29,448.73$ 34,674.46$ 36,370.33$ 37,461.44$

Total Yearly Cost 314,292.00$ 353,384.76$ 416,093.47$ 436,443.91$ 449,537.22$

Total Personnel 42 46 53 54 54


1.2 million in 2014 dollars. Our current plan is to frame the second floor and use it as storage

or dining in the first years of the hospital. As the hospital grows, the second floor will be

finished and repurposed for patient care purposes. Elevators will be added in the center of the

hospital.

The initial hospital floor plan limits entry to one primary door which allows for reduced staffing

and increased security, especially at night. Having outpatient facilities near the interior of the

hospital regulates patient inflow and ensures patient safety and building security (Wester, 2014).

It also places the physicians in close proximity to their wards and to their clinics so time can be

optimized

Equipment

CWACWCH has identified and collaborated with International Medical Equipment Collaborative

(IMEC) to equip and provide biomedical education for the hospital. IMEC repurposes donated

medical equipment to developing countries and designs an equipment plan based on

anticipated needs (IMEC America, 2014). This organization also has biomedical educators who can

ensure the hospital has adequate knowledge in maintaining medical equipment. Information

was obtained by email correspondence with Dr. Sue Crawford, IMEC’s African project

coordinator. Please refer to appendix 5 for CWACWCH equipment profile and proposed

equipment cost.

Christian Health Association of Kenya provides logistical support and biomedical repair for non-

profit member hospitals within Kenya. We have had discussions regarding this organization’s

services and anticipate utilizing CHAK’s expertise in maintaining our hospital equipment. CHAK

also has an extensive in-country hospital network and this organization will be an invaluable

resource for networking on CWACWCH’s behalf (Christian Health Association of Kenya, n.d.).

Ancillary Services

CWACWCH anticipates building an external kitchen with an open air dining area and additional

facilities which families can use to cook food. We will hire cooks to provide food for staff and

for our premium service patients. Meals will also be available for purchase. We would like to

build an external pavilion which can be used by patient’s families for sleeping in hammocks or

within cots. This would encourage families to remain involved in their family members care

while providing a free or discounted safe place to sleep.


Figure 5 – Anticipated patient volume and charges

2016 Monthly 2016 Yearly 2017 Monthly 2017 Yearly 2018 Monthly 2018 Yearly 2019 Monthly 2019 Yearly 2020 Monthly 2020 Yearly

Pediatric Visits/day 30 40 45 50 55

Pediatric Visits/month 600 7200 800 9600 900 10800 1000 12000 1100 13200

Average revenue per visit 20 20.6 21.218 21.85454 22.5101762

Total Revenue Pediatric Visits 12000 144000 16480 197760 19096.2 229154.4 21854.54 262254.48 24761.19382 297134.3258

Obstretric outpatient visits/day 25 45 50 55 60

Obstetric outpatient visits/month 500 6000 900 10800 1000 12000 1100 13200 1200 14400


Total Revenue Obstetric Visit 10000 120000 18540 222480 21218 254616 24039.994 288479.928 27012.21144 324146.5373

Non Premium Services

Obstetrical Deliveries/day 5 6 6.5 7 7.3

Obstetrical Deliveries/month 100 1200 120 1440 130 1560 140 1680 146 1752


5000 60000 6180 74160 6895.85 82750.2 7649.089 91789.068 8216.214313 98594.57176

Surgeries

Appendectomy # 5 6 6 6.5 7

Average revenue per appendectomy 150 154.5 159.135 163.90905 168.8263215

Total Revenue appendectomy 750 9000 927 11124 954.81 11457.72 1065.408825 12784.9059 1181.784251 14181.41101

Caesarean Section # 15 22 24 25 27

Average revenue per C-Section 200 206 212.18 218.5454 225.101762

Total Revenue C-Section 3000 36000 4532 54384 5092.32 61107.84 5463.635 65563.62 6077.747574 72932.97089

Hernia Repair # 15 22 24 25 27

Average revenue per Hernia repair 150 154.5 159.135 163.90905 168.8263215

Total Revenue per Hernia repair 2250 27000 3399 40788 3819.24 45830.88 4097.72625 49172.715 4558.310681 54699.72817

Pediatric (non-premium) Hospital Days per month

Number of Beds 15 15 15 15 15

Percent Capacity 75% 78% 80% 82% 85%

Revenue per patient day 50 51.5 0 53.045 0 54.63635 0 56.2754405 0

Total Revenue pediatric inpatient 16875 202500 18076.5 216918 19096.2 229154.4 20160.81315 241929.7578 21525.35599 258304.2719

Non Obstetrical (non-premium) Hospital Days per month



Revenue per patient day 50 51.5 0 53.045 0 54.63635 0 56.2754405 0

Total Revenue gynecological inpatients 11250 135000 12051 144612 12730.8 152769.6 13440.5421 161286.5052 14350.23733 172202.8479

2016 Monthly 2016 Yearly 2017 Monthly 2017 Yearly 2018 Monthly 2018 Yearly 2019 Monthly 2020 Monthly 2020 Yearly

Sum Total of Revenues - non-premium direct patient services 61,125.00$ 733,500.00$ 80,185.50$ 962,226.00$ 88,903.42$ 1,066,841.04$ 97,771.75$ 1,173,260.98$ 107,683.06$ 1,292,196.66$

Premium Services

Obstetrical Deliveries/day 2 2.2 2.3 2.4 2.5

Obstetrical Deliveries/month 40 480 44 528 46 552 48 576 50 600


6000 72000 6798 81576 7320.21 87842.52 7867.6344 94411.6128 8441.316075 101295.7929

Surgeries

Appendectomy # 1 1.1 1.2 1.3 1.4

Average revenue per appendectomy 250 257.5 265.225 273.18175 281.3772025

Total Revenue appendectomy 250 3000 283.25 3399 318.27 3819.24 355.136275 4261.6353 393.9280835 4727.137002

Caesarean Section # 4 4.4 4.84 5.324 5.8564

Average revenue per C-Section 300 309 318.27 327.8181 337.652643

Total Revenue C-Section 1200 14400 1359.6 16315.2 1540.4268 18485.1216 1745.303564 20943.64277 1977.428938 23729.14726

Hernia Repair # 4 4.4 4.84 5.324 5.8564

Average revenue per Hernia repair 250 257.5 265.225 273.18175 281.3772025

Total Revenue per Hernia repair 1000 12000 1133 13596 1283.689 15404.268 1454.419637 17453.03564 1647.857449 19774.28938

Pediatric (premium) Hospital Days per month

Number of Beds 5 5 5 5 5 5 5


Revenue per patient day 100 103 106.09 109.2727 112.550881

Total Revenue pediatric inpatient 6000 72000 6489 77868 0 0 7589.80856 91077.70272 8208.377958 98500.53549

Non Obstetrical (premium) Female Hospital Days per month



Revenue per patient day 100 103 106.09 109.2727 112.550881

Total Revenue gynecological inpatients 3600 43200 3893.4 46720.8 4210.7121 50528.5452 4553.885136 54646.62163 4925.026775 59100.3213

2016 Monthly 2016 Yearly 2017 Monthly 2017 Yearly 2018 Monthly 2018 Yearly 2019 Monthly 2020 Monthly 2020 Yearly

Sum Total of all Revenue for premium direct patient services 18050 216600 19956.25 239475 14673.3079 176079.6948 23566.18757 282794.2509 25593.93528 307127.2233

Combined Revenue - premium + non-premium services 79,175.00$ 950,100.00$ 100,141.75$ 1,201,701.00$ 103,576.73$ 1,242,920.73$ 121,337.94$ 1,456,055.23$ 133,276.99$ 1,599,323.89$

Drug Revenue as percentage of combined revenue 3,958.75$ 47,505.00$ 5,007.09$ 60,085.05$ 5,178.84$ 62,146.04$ 6,066.90$ 72,802.76$ 6,663.85$ 79,966.19$

5%

Total Combined Revenue 83,133.75$ 997,605.00$ 105,148.84$ 1,261,786.05$ 108,755.56$ 1,305,066.77$ 127,404.83$ 1,528,857.99$ 139,940.84$ 1,679,290.08$


Financial Plan

Facility initial capital funding

CWACWCH anticipates high demand of our hospital services and a lack of foresight by under

sizing our hospital could lead to a diminished reputation. In order to ensure our regional

reputation and establish sustainable cash flow, we need depth and capacity within our pediatric

service lines. Appendix 1 illustrates a tentative 50-bed hospital design with an estimated 1.2

million USD build cost. Connect With A Child just completed building a 460,000 USD orphanage

in Nairobi and has connections with the necessary government organizations and builders to

achieve this goal.

International Medical Equipment Collaborative (IMEC) proposal for CWACWCH anticipates a

$195,000 initial equipment acquisition, repair and organization package. Shipping and setup is

not included in this amount and CWACWCH has budgeted $100,000 for equipment shipping

and setup.

As discussed in the marketing section, Connect With A Child’s existing fundraising connections

will be utilized for some of the funding requirements; however, we do not believe CWAC’s

current fundraising base is adequate to raise the estimated 2 million USD required for startup

expenses. This money will come from a mix of individual, governmental and corporate entities.

Facility sustainment funding

Our proposed facility would be uniquely differentiated from regional government hospitals

through two tiers of service depending upon a patient’s ability to pay. While patient care

quality will remain the same these tiers of service will be differentiated by food choices, room

privacy, and private bathrooms. With two tiers of service, we will improve our ability to

determine who is able to pay by patient self-selection while still meeting the core needs of the

region. Soliciting donations from Connect With A Child’s current fundraising base may be

required to meet ongoing budgetary needs however our goal is self-sustainment. It is possible

that money for capital expenditures will come from donations with sustainment funds coming

from hospital revenue. If successful at attracting higher income clientele to our facility, there is

the possibility that all sustainment needs could be met through healthcare billing.

Cost Structure

Similar non-profit African hospitals have the below anticipated cost structures (Wester, 2014):

1. Salary expense - 25-50%

2. Drug Cost - 25%

3. Upkeep - 10-15%

4. Inventory - 10-15%


We anticipate a slightly different cost structure because the Kenya government provides drugs

to hospitals. Anticipated cost structure excluding bad debt and depreciation:

1. Salary Expense – 50-60%

2. Upkeep 15-20%

3. Inventory – 15-20%

4. Drug Cost – 5-10%

Proforma Income Statement

Proforma Statement of Cash Flows

Proforma Balance Sheet

Income Statement 2016 2017 2018 2019 2020

Patient Care Revenues 950,100.00$ 1,201,701.00$ 1,242,920.73$ 1,456,055.23$ 1,599,323.89$

Drug Sales Revenue 47,505.00$ 60,085.05$ 62,146.04$ 72,802.76$ 79,966.19$

Expenses

Salaries 314,292.00$ 353,384.76$ 416,093.47$ 436,443.91$ 449,537.22$

Advertising/Marketing (.1% of revenues) 950.10$ 1,201.70$ 1,242.92$ 1,456.06$ 1,599.32$

Legal Fees (1% of Revenues) 9,501.00$ 12,017.01$ 12,429.21$ 14,560.55$ 15,993.24$

Depreciation (Straight Line) 54,312.50$ 54,312.50$ 54,312.50$ 54,312.50$ 54,312.50$

Electricity (inflation adjusted) 22,800.00$ 23,484.00$ 24,188.52$ 24,914.18$ 25,661.60$

Internet (Inflation adjusted) 5,472.00$ 5,636.16$ 5,805.24$ 5,979.40$ 6,158.78$

Yearly Inventory Expense/Supplies 108,000.00$ 121,433.43$ 142,981.99$ 149,975.00$ 154,474.25$

Drugs (15% of Salary cost) 47,143.80$ 53,007.71$ 62,414.02$ 65,466.59$ 67,430.58$

Maintenance (Hospital and Vehicle) 62,858.40$ 70,676.95$ 83,218.69$ 87,288.78$ 89,907.44$

Garbage/Sewage (as a percentage of Inventory Expense) 2,760.00$ 3,103.30$ 3,653.98$ 3,832.69$ 3,947.68$

Bad Debt (% of Revenues) 190,020.00$ 240,340.20$ 248,584.15$ 291,211.05$ 319,864.78$

Total Cost 818,109.80$ 938,597.72$ 1,054,924.69$ 1,135,440.70$ 1,188,887.40$

Net Income 179,495.20$ 323,188.33$ 250,142.08$ 393,417.30$ 490,402.68$

Statement of Cash Flows

2016 2017 2018 2019 2020

Beginning Cash Balance 2,000,000.00$ 833,807.70 1,191,309 1,475,763 1,893,493

Revenues less bad debt 807,585$ 1,021,445.85 1,056,483$ 1,237,647$ 1,359,425$

Salaries 314,292$ 353,384.76 416,093$ 436,444$ 449,537$

Advertising 950$ 1,201.70 1,243$ 1,456$ 1,599$

Legal Fees 9,501$ 12,017.01 12,429$ 14,561$ 15,993$

Electricity (inflation adjusted) 22,800.00$ 23,484.00 24,188.52$ 24,914.18$ 25,661.60$

Internet (Inflation adjusted) 5,472.00$ 5,636.16 5,805.24$ 5,979.40$ 6,158.78$

Yearly Inventory Expense/Supplies 108,000.00$ 121,433.43 142,981.99$ 149,975.00$ 154,474.25$

Drugs (15% of Salary cost) 47,143.80$ 53,007.71 62,414.02$ 65,466.59$ 67,430.58$

Maintenance (Hospital and Vehicle) 62,858.40$ 70,676.95 83,218.69$ 87,288.78$ 89,907.44$

Garbage/Sewage (as a percentage of Inventory Expense) 2,760.00$ 3,103.30 3,653.98$ 3,832.69$ 3,947.68$

Investing Activities

Fixed Assets 1400000 20,000 20,000 30,000 30,000

Total Investing Activities 1400000 20000 20000 30000 30000

Total Financing Activities -$ -$ -$ -$ -$

Cash Balance, End of Period 833,808 1,191,309 1,475,763 1,893,493 2,408,208

Balance Sheet

2016 2017 2018 2019 2020

Current Assets

Cash 833,807.70$ 1,191,308.53$ 1,475,763.11$ 1,893,492.91$ 2,408,208.09$

Inventories 10,800.00$ 12,143.34$ 14,298.20$ 14,997.50$ 15,447.42$

Long Term Assets

Net Fixed Assets 1,394,500.00$ 1,394,500.00$ 1,394,500.00$ 1,394,500.00$ 1,394,500.00$

Total Assets 2,239,107.70$ 2,597,951.87$ 2,884,561.31$ 3,302,990.41$ 3,818,155.52$

Current Liabilities

Debt -$ -$ -$ -$ -$

Equity -$ -$ -$ -$ -$

Common Stock -$ -$ -$ -$ -$

Retained Earnings 2,239,107.70$ 2,597,951.87$ 2,884,561.31$ 3,302,990.41$ 3,818,155.52$

Total Liabilities 2,239,107.70$ 2,597,951.87$ 2,884,561.31$ 3,302,990.41$ 3,818,155.52$


Conclusions Connect With A Child Women’s and Children’s Hospital is a unique organization that has the potential to

radically change thousands of lives. This hospital is a unique opportunity for a small investment of

money to reap enormous rewards for many years. Through self-sustainment and fiscal discipline,

CWACWCH will use its resources to enhance community health and save women and children’s lives.

With strong health care you will give this population an opportunity to progress out of poverty and to

build better futures for the children of Siaya County.

As you consider investing in Connect With A Child Women’s and Children’s Hospital realize that a single

investment in food or clothing will only help these individuals for a short time, CWACWCH will help them

their entire lives.


Appendix 1 – Tentative Hospital Design


Appendix 2 – Survey used to interview Siaya residents


Appendix 3 – Location of Hospital within Kenya


Appendix 4 – Cumulative Survey of Siaya County Residents


Appendix 5 – Survey of Leaders within Siaya County


Appendix 6 – IMEC Equipment Cost Estimate


References

CBS News. (2008, 02 11). Retrieved from http://www.cbsnews.com/news/un-600000-displaced-in-kenya-unrest/.

changamka.co.ke. (n.d.).

Christian Health Association of Kenya. (n.d.). Retrieved from CHAK: http://www.chak.or.ke/

(June 2007). Country Profile: Kenya,. Washington, DC: Library of Congress – Federal Research Division.

Daily Nation. (2014, 03 9). Retrieved from http://mobile.nation.co.ke/news/Tourism-Security-Kenya-Coast/-/1950946/2236932/-

/format/xhtml/-/15ly2e5z/-/index.html.

Dogbey, B. (2012). Kenya: Mobility of Health Professionals. Brussels: International Organization for Migration (IOM).

(2013). Draft: The National Broadband Strategy for Kenya. Government of the Republic of Kenya.

http://medicine.unm.edu/globalhealth/. (n.d.).

IMEC America. (2014, October 29). Retrieved from http://imecamerica.org/

Kimenyi, M., & Kibe, J. (2014, January 6). www.brookings.edu/research/opinions/2013/12/30-kenya-economy-kimenyi.

Leposo, F. K. (2014, May 1). New Kenya law legalizes polygamy; women's group applauds it. Retrieved from www.cnn.com:

http://www.cnn.com/2014/05/01/world/africa/kenya-polygamy-law/index.html

Miller, S. (n.d.). VP of International Operations - Cure International. (G. Dunn, Interviewer)

Q&A: Kenyan leaders at The Hague (www.bbc.co.uk). (n.d.). Retrieved January 29, 2014

Soucat, A., Scheffler, R., & with Tedros Adhanom Ghebreyesus, e. (2013). The Labor Market for Health Workers in Africa: A New Look at the

Crisis. Washington DC: World Bank.

Wester, T. (2014, September 2nd). MD, Medical Director, Gamboula Hospital, Central African Republic. (G. Dunn, Interviewer)

World Bank. (n.d.). www.worldbank.org.

www.cia.gov/library/publications/the-world-factbook/geos/ke.html. (n.d.).

www.kwaho.org. (n.d.).

www.opendata.go.ke/. (n.d.). Retrieved 2014

www.siayacounty.com/environment.php. (n.d.).

www.unicef.org. (2014, January 27).

Abbreviations

SDH – Siaya District Hospital

IMEC – International Medical Equipment Collaborative

CWAC – Connect With A Child

CWACWCH – Connect With A Child Women and Children’s Hospital


Slide Presentation

Connect With A Child – Women’s and Children’s...

Documents

Transcript of Connect With A Child – Women’s and Children’s...