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Table of Contents
1.0 Executive Summary.............................................................................................................................1 1.1 Objectives ...................................................................................................................................2 1.2 Mission........................................................................................................................................2 1.3 Keys to Success ........................................................................................................................2 Chart: Highlights ......................................................................................................................3 2.0 Organization Summary .......................................................................................................................3 2.1 What Makes Bright House Unique ...........................................................................................3 2.2 Legal Entity .................................................................................................................................4 2.3 Start-up Summary ......................................................................................................................4 Chart: Start-up .........................................................................................................................5 Table: Start-up .........................................................................................................................6 Table: Start-up Funding ..........................................................................................................7 2.4 Locations and Facilities ............................................................................................................7 3.0 Services................................................................................................................................................8 3.1 Service Description ...................................................................................................................8 3.2 Alternative Providers .................................................................................................................8 3.3 Printed Collaterals .....................................................................................................................9 3.4 Technology..................................................................................................................................9 3.5 Future Services ..........................................................................................................................9 4.0 Market Analysis Summary................................................................................................................10 Chart: Market Analysis (Pie)................................................................................................11 Table: Market Analysis .........................................................................................................11 4.1 Market Segmentation..............................................................................................................11 4.2 Target Market Segment Strategy...........................................................................................11 4.2.1 Market Trends .............................................................................................................12 4.2.2 Market Needs ..............................................................................................................12 4.3 Service Providers Analysis.....................................................................................................13 4.3.1 Organization Participants...........................................................................................13 4.3.2 Alternatives and Usage Patterns...............................................................................13 4.3.3 Main Alternatives.........................................................................................................14 5.0 Management Summary ....................................................................................................................14 5.1 Management Team Gaps .......................................................................................................15 5.2 Caregiving Organizational Chart............................................................................................15 5.3 Personnel Plan.........................................................................................................................16 Table: Personnel ...................................................................................................................17 6.0 Strategy and Implementation Summary..........................................................................................17 Chart: Milestones ..................................................................................................................18 Table: Milestones..................................................................................................................18 7.0 Financial Plan ....................................................................................................................................19 7.1 Important Assumptions............................................................................................................19 7.2 Key Financial Indicators ..........................................................................................................19 Table: Funding Forecast ......................................................................................................20 Chart: Funding Monthly.........................................................................................................20 Chart: Funding by Year.........................................................................................................21 7.3 Projected Surplus or Deficit....................................................................................................22 Chart: Surplus Monthly..........................................................................................................22 Chart: Gross Surplus Yearly.................................................................................................22
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Table: Surplus and Deficit....................................................................................................23 7.4 Break-even Analysis................................................................................................................23 Table: Break-even Analysis .................................................................................................24 Chart: Break-even Analysis .................................................................................................24 7.5 Projected Cash Flow...............................................................................................................24 Table: Cash Flow..................................................................................................................25 Chart: Cash ...........................................................................................................................26 7.6 Projected Balance Sheet ........................................................................................................27 Table: Balance Sheet ...........................................................................................................27 7.7 Standard Ratios .......................................................................................................................27 Table: Ratios .........................................................................................................................28 Table: Funding Forecast ...........................................................................................................................1 Table: Personnel ........................................................................................................................................2 Table: Surplus and Deficit .........................................................................................................................3 Table: Cash Flow .......................................................................................................................................5 Table: Balance Sheet ................................................................................................................................6
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1.0 Executive Summary
Where would you want to live if you needed daily assistance? In your home, of course. Bright House aims to be that home for 14 lucky full-time assisted living residents, offering medicallyskilled care in a respectful, self-sustaining community, and offering skilled nursing care for short-term residents. On our beautiful, newly remodeled 6 acre property (the former Wayfield Bed and Breakfast) in the small college town of Middletown, CT, Bright House brings together dec ades of experience and innovative, alternative visions of the potential in our elderly family members' latest years. In our first five years, we will establish a new kind of Elder Care model based on the idea that the elderly are fully-realized persons, with ideas, thoughts, and experiences which matter. Can you help us to realize this goal?
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1.1 Objectives
For our first year, we have four financial objectives: To raise adequate funding for start-up. To fill all of the rooms in the main house over the course of six months. To open the Skilled Nursing Fac ility, and maintain it at 9 to 10 rooms oc cupied for 25 days per month thereafter. Begin development implementation for the ongoing funding needs of years two through five.
We have other, non-financial objectives as well: To provide a warm, comfortable, safe and engaging home for up to 14 permanent residents. Ongoing feedback through the resident House Councils will give us a weekly update on our progress. To provide skilled medical care in a similarly respectful atmosphere to our temporary Medicare residents. To provide adequate training, mentoring and recompense to our caregiving staff to create job satisfac tion.
1.2 Mission
At Bright House, we promote the dignity and self-worth of all of our residents, and strive to give them excellent quality of life, as defined by the residents, individually and as a group. To that end, we encourage resident group dec ision-making through the House Councils, ac cess to all areas of their homes here at Bright House, and self-determination in activities, soc ialization, and food preferences. Bright House is not just a caregiving fac ilityit is their home, and their community. We also value the time, skills, and expert opinions of our staff. We are committed to providing fair and living wages, reasonable, structured work schedules, and clear duties and spheres of rights and responsibilities for eac h team member. We do not expec t staff to do work for which they are not trained; we do expec t them to share their suggestions for improving any aspec t of Bright House working operations or caregiving. We aim to provide jobs which not only provide sustenance for our workers' families, but also allow them a spac e to make a difference in the world around them, through caring and expert assistance to our community's most vulnerable members.
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more intensive assistance.
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medicines administered, test results, and billable nursing hoursit does not provide good quality of life for residents (or "patients," as they are referred to in the hospital model). At Bright House, we see a different way of assisting our elderly members through a new stage in their lives. Ac knowledging that where they live is their home, and belongs to them, not to the medical staff, we have established a fac ility that not only meets their medical and physical needs, but one that also nourishes their social connections, individual dignity, and personal preferences. Each resident has a private room with bath, opening onto a central shared common area containing the kitchen, living room, and dining room, where all meals are shared communally at our 15 foot farm-style dining table. Far more devastating than physical illness to our elders, is lac k of purpose. Studies have shown over and over that seniors who are engaged in activities they find meaningful are far more likely to retain mental ac uity, physical health, and emotional well-being. Although the hospital model tries to provide such stimulation, its "ac tivities" are usually organized by staff, with little or no input from "patients," and bec ome just one more set of required tasks for all involved. At Bright House, we have already begun working with prospec tive residents to identify areas of interest and methods of community involvement that will appeal to them.
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of the overall plan. This category includes new Long-term Assets needed as follows: $200,000 for (long-term, resalable) medical equipment, and $150,000 for initial furnishings, after the renovation. Medical Equipment: 1 Fully-loaded Crash Cart Standard monitoring equipment (blood pressure, sugar, etc.) Call-button system
Furnishings: For the common areas of both buildings, we will need couches, self-lifting recliners, tables, and chairs suitable to our residents' needs. We have alloc ated $35,000 for furnishing the four common rooms. Each private room will need a hospital-capable bed, linens, a dresser, and a phone, at the minimum. With the remaining funding, that leaves just over $6,000 per room. This budget will allow us to provide attrac tive, functional, and comfortable surroundings to our residents in their new homes. Each bedroom in the main building will have enough remaining space that residents can bring plenty of familiar furniture with them (up to two side tables and wingbac k/ reclining chairs, and a second dressing table or its equivalent).
Funding To fund these start-up costs, we have secured a low-interest loan for $210,000, and have collected donations and pledges in the amount of $291,500. We have also included the value ($400,000) of the Bright House property in the "donations collected" category to ac curately reflect our assets. We must raise an additional $7,650 by January 1st to begin operations.
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Table: Start-up
Start-up Requirements Start-up Expenses Legal Stationery etc. Advertising Insurance Computerized Medical Records System Expensed Medical Equipment Staff Training Total Start-up Expenses Start-up Assets Cash Required Start-up Inventory Other Current Assets Long-term Assets Total Assets Total Requirements
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Table: Start-up Funding
Start-up Funding Start-up Expenses to Fund Start-up Assets to Fund Total Funding Required Assets Non-cash Assets from Start-up Cash Requirements from Start-up Additional Cash Raised Cash Balance on Starting Date Total Assets $49,150 $865,000 $914,150
Liabilities and Capital Liabilities Current Borrowing Long-term Liabilities Accounts Payable (Outstanding Bills) Other Current Liabilities (interest-free) Total Liabilities Capital Planned Investment Donations Collected Donations Pledged Needed Additional Investment Requirement Total Planned Investment Loss at Start-up (Start-up Expenses) Total Capital $597,000 $94,500 $0 $7,650 $699,150 ($49,150) $650,000
$865,000 $914,150
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The skilled nursing fac ility to the left of the main building can house up to eleven adults, and is the only area of the fac ilities which will house residents receiving Medicare or Medicaid payments. This part of Bright House has two purposes: as a short-term rehabilitation center for community members recovering from surgery or medical emergencies; and as a full-service nursing fac ility for residents who can no longer take care of their own needs sufficiently in the main building. The continuity of loc ation, social contac t, and quality of care ensures that our residents will remain in the best possible surroundings when their needs are greatest. Middletown, where we are situated, is centrally loc ated 25 minutes from Hartford, and 30 minutes from New Haven. Middletown is a small college town, with an ethnically and economically-varied population.
3.0 Services
We offer two services: Assisted Living and Skilled Nursing Care. We will begin providing services in January of next year.
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Analysis. Our nonprofit status and our alternative care model allow us to offer more residentoriented services at a better price, with a more satisfied and team-oriented staff, than these fac ilities can. For our privately insured residents, we offer respectful and nurturing care, viewing the resident as a whole person, in a particular stage of their life's journey. For our Medicare residents, we offer a more humane, but still medically-qualified, alternative to the drab prospec ts of a standard nursing home. And for their families, we offer peace of mind, and the knowledge that outside of in-home, full-time care, their loved ones are receiving the best possible daily assistance in maintaining their preferred lifestyle.
3.4 Technology
In addition to our advanced medical equipment, the main use of technology at Bright House will be the installation and use of our computerized medical record system. The benefits of this system (described in the Start-up Summary, above) are numerous. The system will also allow residents to ac cess their own individual records with a password at will, to ensure that they understand as much as they can about their own situation, and how to maintain their health. We are working carefully with DigInfoMedTel to ensure that all of our technology meets Health Insurance Portability and Ac countability Ac t (HIPAA) standards before implementation. We will hold a series of HIPAA trainings with the software in mid-December to ensure that our staff is fully-knowledgeable in this area.
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establishing the best caregiver/resident proportion.
While the overall population of Connecticut is projected to dec line over the next five years, before rising again, we know that the proportion of the overall population age 75 and older (our target market age) is slowly rising. We therefore include a modest projected increase in potential customers of 1% over the next five years. Medicare residents and short stays: A study published recently in the journal Health Affairs by Morrissey, Sloan, and Valvona found that the proportion of Medicare patients transferred to post-hospital care has doubled since the Prospec tive Payment System (PPS) was introduced. Rather than staying in the hospital until recuperated, the current system preferentially delegates recovery care to private nonhospital fac ilities, leaving room in hospitals for urgent or crisis care. We base our projections for Medicare residents on the same figures listed above, but looking at the percentage of elderly with family incomes between $30,000 and $75,000 dollars,* rather than just the highest brac ket, we get 40% of the population, or 60,735. We apply the same conservative 1% growth rate, below. *This income range was chosen because it correlates with the kind of higher education levels that most families choosing non-hospital model skilled nursing care report. Although residents with lower incomes may have a need for our service, they are traditionally less likely to seek out alternative care. Page 10
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4.2.1 Market Trends
In the old days, families just took care of families and that took care of the problem of aging, but we can no longer do that. Churches and other organizations cant always take up the slac k in this area, and so we are left with public policy dec isions about what happens. -Senator John Glenn, April 27, 1998 Elder Care Today and Tomorrow, Fielding Hearing of the U. S. Senate Special Committee on Aging, Columbus, Ohio As mentioned in our Market Analysis, the percentage of the population over 75 is growing rapidly, thanks to better nutrition, preventative health c are, and living conditions in our country over the course of the last century, not to mention the Baby Boomers. At the same time, the increasing kinds of career opportunities for women, and the growing cost of health c are, have contributed to a nursing shortage which threatens the quality of professionally-provided elder care. Phyllis Moen and Emma Detinger of Cornell University point out, in a paper for the Sloan Work Family Policy Center, that the quote above, "...reflects an issue emanating from structural lag, as policies and prac tices fail to keep pac e with c hanges in the workforce, in families, and in gender roles (Riley and Riley 1994, 2000). The organization of both work and career paths reflects a continued reliance on the male breadwinner template, assuming a workforce without family responsibilities (Moen and Yu 2000). But the new reality is that almost half the workforce is now female, meaning that most workersmale and femalehave no one at home to provide care to older ailing or infirm relatives, much less child care (see disc ussion in Harrington 1999 and Moen 1992). Moreover, most cannot afford to purchase comprehensive, round-the-cloc k care. The 21st century will witness concerns over childcare policies and prac tices morphing into concerns over dependent care policies and prac ticesan amalgam of both c hildcare and elder care."
You may notice that our list of "needs" seems to go in the opposite order to that of most hospital-model nursing homes; this is not an ac cident. Unfortunately, most of our elderly Page 12
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population who need care are treated with the billing system's needs, and not their own, in mind. Families' Needs Similarly, the families of people seeking caring environments have their own set of needs they are seeking to fulfill: Peac e of mind about their loved-ones' physical and mental state Relief from the time-consuming job of caring for their family members themselves Relief from the feelings of guilt which often overcome them when they find they do not have the physical, emotional, or intellectual resources to personally provide appropriate care for those they love
The big, unstated elephant-in-the-room for families seeking care is the feeling of being a bad daughter or son or spouse, who is not willing or able to put her life on hold to take care of a much-loved family member. At Bright House, we do not seek to dismiss this feeling, but to reassure families in everything we do that the choice to let us take care of their family member is a loving, kind, and generous ac t.
Of these, 57 are part of a multi-home chain, and only 15 are nonprofit. None of them combine both assisted living and skilled nursing care with the alternative, non-hospital model we use.
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to make visiting their family member easier.
Fox Hill Center is typical of the hospital-model nursing home. It is large (150 beds), for-profit, and has a fairly low rate of nursing hours per resident day. Its size makes it able to care for many patients, but often at the expense of individual attention. Sister Anne Virginie Grimes Health Center, New Haven Nonprofit, religious based, loc ated in a hospital 4.16 nh/rd 125 beds 3 deficiencies
The Grimes Health Center, like many religious care centers, is nonprofit, and has a slightly higher rate of nursing hours per resident day than the for-profit centers, despite its large size. Quality of care, however, is noticeably higher (3 deficiencies in inspec tion, compared to 11 at Fox Hill). Leeway, Inc., New Haven Nonprofit 5.04 nh/rd 40 beds 4 deficiencies
Leeway is a typical spec ialized private (not in a hospital) nonprofit care fac ility. It is much smaller than the other two described, has the highest rate of nursing care per resident day, and high quality marks in inspec tion. Its small size and nonprofit status allow it to foc us on providing individual attention. Leeway is Connecticut's first and only skilled nursing home dedicated solely to the treatment of people living with AIDS.
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coming day. Although the Medical Director has the ultimate responsibility for the health and well-being of all residents and visitors, the nursing and caregiving staff, with their different kinds of knowledge about the residents' physical, soc ial, and mental well-being, are expec ted to note, disc uss, and recommend courses of ac tion for all residents who, in their combined estimation, need help. A 2001 study by the Robert Wood Johnson Foundation found that the small percentage of Chief Nursing Officers reporting no nursing shortages in their fac ilities at the time of the study cited formalized programs foc used on the needs of, and professional recognition for, their nursing staffs as the reason for their adequate staffing. Our compensation pac kages, management structure, and caregiving requirements are designed to continually remind our LPNs and Elder Assistants how very valuable they are. Dr. Mildred Johnson is our Medical Director. Dr. Johnson has served as the head of Gerontology for six years at The Connecticut Hospital, and oversaw the creation, last year, of their Elder Assistant training program, which provides certification for Certified Nursing Assistants (CNA) to provide in-home hospice and respite care. Dr. Johnson has 20 years of experience working with elderly patients in this area, and has been integral in designing the physical layout, management structure, and priorities of Bright House. The rest of our already-hired caregiving staff brings a whopping collective 75 years of professional experience in c aring for elderly patients. Financial Management: Madeleine Morgan has been overseeing financial management of nonprofit organizations in Connecticut for 27 years. She bec ame involved in our project when her mother developed a long-term care plan with Dr. Johnson which included home-based hospice care. "I wish everyone could have the same love and attention Dr. Johnson showed to my mother," Madeleine said. Ms. Morgan will be in c harge of all financial operations at Bright House, overseeing billing, personnel payment and benefits, and development efforts. Advertising and Marketing: We are fortunate to have a skilled public relations officer in our group. Janice Ruthers is a retired ad executive living in Middletown with her husband (a professor at the university). She will be working 20 hours per week in our offices as a volunteer for the first two years of our plan, helping us design advertisements and broc hures, and to plan events like our Open House in December to let the public see the results of our efforts.
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2 full-time LPNs (alternating 30- and 40-hour weeks9pm to 7am, switching 4 and 3 days/week) (hiredwill start training December) 1 swing-shift LPN (35 hrs/week, 5-10pm) (still seeking) 6 full-time Elder Assistants (5 CNAs with CPR and First Aid training are currently taking part in our spec ial Elder Care training; the sixth still needs to be hired)
We will also need administrative and development personnel: 1 full-time Financial Manager (Madeleine Morgan) 1 part-time (20 hours/week) Medicare Billing Specialist (Abby Hannahcurrently helping to plan our computerized medical records system) 1 part-time Development officer (Jessica Breindel)
Table: Personnel
Personnel Plan Year 1 Medical/Clinical Personnel Medical Director LPNs - Full-time 35-40 hrs, night LPNs - swing shift, 30 hours, day Subtotal Caretaking Personnel Elder Assistants Other Subtotal Administrative Personnel Medicare Liason / Billing Specialist Financial Manager Janice Ruthers - Part-time Marketing Subtotal Fundraising Personnel Development Officer - Part-time Name or Title or Group Name or Title or Group Subtotal Total People Total Payroll $66,000 $117,000 $34,125 $217,125 Year 2 $66,000 $118,000 $58,500 $242,500 Year 3 $67,000 $119,000 $59,000 $245,000
$221,520 $0 $221,520
$223,000 $0 $223,000
$255,000 $0 $255,000
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Table: Milestones
Milestones Milestone Collect Pledges for Remaining Funds Finalize Agreements w/ Medical Suppliers Finish All Remodeling Buy Furnishings Inspection Collect Donations Pledged Install-Test Computerized Medical System Place Ads in Hartford Courant Finish Brochures Test Billing System Finish Hiring Process Alternative Care Model Staff Training Open House First Residents Move in First Operational Review House Councils Begin Assisted Living Facility Full Add "What's New" Pamphlet to Brochures Totals Start Date 6/4/2009 7/30/2004 6/23/2004 8/15/2004 11/1/2004 7/26/2004 9/1/2004 10/1/2004 9/1/2004 10/15/2004 8/1/2004 12/1/2004 12/10/2004 1/1/2005 1/15/2005 1/20/2005 6/1/2005 6/1/2005 End Date 8/30/2004 9/30/2004 8/15/2004 11/1/2004 11/15/2004 11/15/2004 10/30/2004 10/15/2004 11/1/2004 11/10/2004 12/15/2004 1/1/2005 12/20/2004 1/5/2005 1/30/2005 1/20/2005 6/1/2005 6/20/2005 Budget $0 $0 Manager Breindel Morgan Department Department Department Department Department Department Department Department Department Department Department Department Department Department Department Department Department Department Department
$5,000 Morgan, Ruthers $0 Morgan, Ruthers, Johnson $0 Johnson $0 Breindel, Morgan $0 Hannah $450 Ruthers $2,000 Ruthers $0 Morgan, Hannah $0 Morgan, Johnson $5,000 Johnson $0 Ruthers
$0 ABC $0 Johnson, Morgan $0 Johnson, Elder Assistants Johnson, Morgan, Ruthers $200 Ruthers $12,650 $0
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7.0 Financial Plan
As our Break-even Analysis (below) shows, Bright House would need 13 residents per month to break-even at current funding levels. We intend, of course, to do better than this.
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Table: Funding Forecast
Funding Forecast Year 1 Units Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Total Units Unit Prices Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Funding Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Total Funding Direct Unit Costs Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Direct Cost of Funding Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Subtotal Direct Cost of Funding $0 $76,140 $0 $76,140 $0 $89,424 $0 $89,424 $0 $91,287 $0 $91,287 150 94 0 244 Year 1 $3,200.00 $4,050.00 $0.00 Year 2 150 96 0 246 Year 2 $3,200.00 $4,050.00 $0.00 Year 3 150 98 0 248 Year 3 $3,200.00 $4,050.00 $0.00
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7.3 Projected Surplus or Deficit
The projected surplus and deficit follows, below.
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Table: Surplus and Deficit
Surplus and Deficit Funding Direct Cost Medical/Clinical Payroll Non-reusable Medical Equipment #NAME? Total Direct Cost Gross Surplus Gross Surplus % Operating Expenses Caretaking Expenses Caretaking Payroll Groceries Cleaning Supplies Other Caretaking Expenses Total Caretaking Expenses Caretaking % Administrative Expenses Administrative Payroll Other Expense Account Name Depreciation Property Taxes Utilities Insurance Payroll Taxes Grounds and Building Upkeep Other Total Administrative Expenses Administrative % Fundraising Expenses: Fundraising Payroll Brochures, Marketing Fundraising Expenses Total Fundraising Expenses Fundraising % Total Operating Expenses Surplus Before Interest and Taxes EBITDA Interest Expense Taxes Incurred Net Surplus Net Surplus/Funding Year 1 $860,700 $76,140 $217,125 $4,800 $0 $298,065 $562,635 65.37% Year 2 $868,800 $89,424 $242,500 $5,000 $0 $336,924 $531,876 61.22% Year 3 $876,900 $91,287 $245,000 $5,000 $0 $341,287 $535,613 61.08%
$14,400 $800 $0 $15,200 1.77% $492,237 $70,398 $71,598 $20,479 $0 $49,919 5.80%
$15,000 $1,000 $0 $16,000 1.84% $503,625 $28,251 $29,751 $17,200 $0 $11,051 1.27%
$15,500 $500 $0 $16,000 1.82% $546,425 ($10,812) ($9,012) $13,450 $0 ($24,262) -2.77%
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including personnel, we need to serve 13 residents to cover costs. We plan to reac h this fairly conservative goal by the second month of operations (see the Resident Forecast, above).
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Table: Cash Flow
Pro Forma Cash Flow Year 1 Cash Received Cash from Operations Cash Funding Cash from Receivables Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Expenditures Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent Net Cash Flow Cash Balance Year 2 Year 3
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7.6 Projected Balance Sheet
Our Balance Sheet shows a continued high net worth, reflecting the value of our property, fac ility, and medical and communication assets.
$22,635 $4,500 $0 $27,135 $185,000 $212,135 $699,150 ($49,150) $49,919 $699,919 $912,054 $699,919
$22,811 $4,500 $0 $27,311 $150,000 $177,311 $734,150 $769 $11,051 $745,970 $923,281 $745,970
$23,249 $4,500 $0 $27,749 $110,000 $137,749 $774,150 $11,820 ($24,262) $761,708 $899,457 $761,708
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Table: Ratios
Ratio Analysis Funding Growth Percent of Total Assets Accounts Receivable Inventory Other Current Assets Total Current Assets Long-term Assets Total Assets Current Liabilities Long-term Liabilities Total Liabilities Net Worth Percent of Funding Funding Gross Surplus Selling, General & Administrative Expenses Advertising Expenses Surplus Before Interest and Taxes Main Ratios Current Quick Total Debt to Total Assets Pre-tax Return on Net Worth Pre-tax Return on Assets Additional Ratios Net Surplus Margin Return on Equity Activity Ratios Accounts Receivable Turnover Collection Days Inventory Turnover Accounts Payable Turnover Payment Days Total Asset Turnover Debt Ratios Debt to Net Worth Current Liab. to Liab. Liquidity Ratios Net Working Capital Interest Coverage Additional Ratios Assets to Funding Current Debt/Total Assets Acid Test Funding/Net Worth 1.06 3% 5.09 1.23 1.06 3% 5.48 1.16 1.03 3% 4.63 1.15 n.a n.a n.a n.a 6.94 6.64 23.26% 7.13% 5.47% Year 1 5.80% 7.13% 7.36 7.03 19.20% 1.48% 1.20% Year 2 1.27% 1.48% 6.45 6.17 15.31% -3.19% -2.70% Year 3 -2.77% -3.19% 1.61 1.20 54.58% 5.88% 12.94% Year 1 n.a. Year 2 0.94% Year 3 0.93% Industry Profile 1.62%
4.60% 0.89% 3.40% 20.64% 79.36% 100.00% 2.98% 20.28% 23.26% 76.74%
4.59% 0.96% 3.36% 21.77% 78.23% 100.00% 2.96% 16.25% 19.20% 80.80%
4.75% 0.88% 3.45% 19.90% 80.10% 100.00% 3.09% 12.23% 15.31% 84.69%
14.37% 0.55% 36.74% 51.66% 48.34% 100.00% 20.58% 28.02% 48.60% 51.40%
n.a n.a
0.30 0.13
0.24 0.15
0.18 0.20
n.a n.a
$161,119 3.44
$173,670 1.64
$151,208 -0.80
n.a n.a
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Dividend Payout 0.00 0.00 0.00 n.a
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Appendix
Table: Funding Forecast
Funding Forecast Month 1 Units Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Total Units Unit Prices Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Funding Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Total Funding Direct Unit Costs Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Direct Cost of Funding Assisted Living Main Residents Medicare Residents - Skilled Nursing Facility Other Subtotal Direct Cost of Funding $0 $2,430 $0 $2,430 $0 $3,240 $0 $3,240 $0 $3,240 $0 $3,240 $0 $4,860 $0 $4,860 $0 $6,480 $0 $6,480 $0 $7,290 $0 $7,290 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 $0 $8,100 0% 0% 0% 8 3 0 11 Month 1 $3,200.00 $4,050.00 $0.00 Month 2 10 4 0 14 Month 2 $3,200.00 $4,050.00 $0.00 Month 3 10 4 0 14 Month 3 $3,200.00 $4,050.00 $0.00 Month 4 12 6 0 18 Month 4 $3,200.00 $4,050.00 $0.00 Month 5 12 8 0 20 Month 5 $3,200.00 $4,050.00 $0.00 Month 6 14 9 0 23 Month 6 $3,200.00 $4,050.00 $0.00 Month 7 14 10 0 24 Month 7 $3,200.00 $4,050.00 $0.00 Month 8 14 10 0 24 Month 8 $3,200.00 $4,050.00 $0.00 Month 9 14 10 0 24 Month 9 $3,200.00 $4,050.00 $0.00 Month 10 14 10 0 24 Month 10 $3,200.00 $4,050.00 $0.00 Month 11 14 10 0 24 Month 11 $3,200.00 $4,050.00 $0.00 Month 12 14 10 0 24 Month 12 $3,200.00 $4,050.00 $0.00
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Appendix
Table: Personnel
Personnel Plan Month 1 Medical/Clinical Personnel Medical Director LPNs - Full-time 35-40 hrs, night LPNs - swing shift, 30 hours, day Subtotal Caretaking Personnel Elder Assistants Other Subtotal Administrative Personnel Medicare Liason / Billing Specialist Financial Manager Janice Ruthers - Part-time Marketing Subtotal Fundraising Personnel Development Officer - Part-time Name or Title or Group Name or Title or Group Subtotal Total People Total Payroll 100% $1,200 $0 $0 $1,200 13 $40,250 $1,200 $0 $0 $1,200 13 $43,370 $1,200 $0 $0 $1,200 13 $43,370 $1,200 $0 $0 $1,200 13 $43,370 $1,200 $0 $0 $1,200 13 $43,370 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 $1,200 $0 $0 $1,200 14 $48,245 100% 200% 100% $5,500 $9,750 $0 $15,250 Month 2 $5,500 $9,750 $0 $15,250 Month 3 $5,500 $9,750 $0 $15,250 Month 4 $5,500 $9,750 $0 $15,250 Month 5 $5,500 $9,750 $0 $15,250 Month 6 $5,500 $9,750 $4,875 $20,125 Month 7 $5,500 $9,750 $4,875 $20,125 Month 8 $5,500 $9,750 $4,875 $20,125 Month 9 $5,500 $9,750 $4,875 $20,125 Month 10 $5,500 $9,750 $4,875 $20,125 Month 11 $5,500 $9,750 $4,875 $20,125 Month 12 $5,500 $9,750 $4,875 $20,125
600%
$15,600 $0 $15,600
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
$18,720 $0 $18,720
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Appendix
Table: Surplus and Deficit
Surplus and Deficit Funding Direct Cost Medical/Clinical Payroll Non-reusable Medical Equipment #NAME? Total Direct Cost Gross Surplus Gross Surplus % Operating Expenses Caretaking Expenses Caretaking Payroll Groceries Cleaning Supplies Other Caretaking Expenses Total Caretaking Expenses Caretaking % Administrative Expenses Administrative Payroll Other Expense Account Name Depreciation Property Taxes Utilities Insurance Payroll Taxes Grounds and Building Upkeep Other Total Administrative Expenses Administrative % Fundraising Expenses: Fundraising Payroll Brochures, Marketing Fundraising Expenses Total Fundraising Expenses $1,200 $800 $0 $2,000 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 $1,200 $0 $0 $1,200 15% 15% Month 1 $37,750 $2,430 $15,250 $400 $0 $18,080 $19,670 52.11% Month 2 $48,200 $3,240 $15,250 $400 $0 $18,890 $29,310 60.81% Month 3 $48,200 $3,240 $15,250 $400 $0 $18,890 $29,310 60.81% Month 4 $62,700 $4,860 $15,250 $400 $0 $20,510 $42,190 67.29% Month 5 $70,800 $6,480 $15,250 $400 $0 $22,130 $48,670 68.74% Month 6 $81,250 $7,290 $20,125 $400 $0 $27,815 $53,435 65.77% Month 7 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44% Month 8 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44% Month 9 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44% Month 10 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44% Month 11 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44% Month 12 $85,300 $8,100 $20,125 $400 $0 $28,625 $56,675 66.44%
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Appendix
Fundraising % Total Operating Expenses Surplus Before Interest and Taxes EBITDA Interest Expense Taxes Incurred Net Surplus Net Surplus/Funding 5.30% $38,038 ($18,368) ($18,268) $1,821 $0 ($20,188) -53.48% 2.49% $40,826 ($11,516) ($11,416) $1,808 $0 ($13,324) -27.64% 2.49% $40,826 ($11,516) ($11,416) $1,792 $0 ($13,307) -27.61% 1.91% $40,826 $1,365 $1,465 $1,775 $0 ($411) -0.65% 1.69% $40,826 $7,845 $7,945 $1,750 $0 $6,095 8.61% 1.48% $41,557 $11,878 $11,978 $1,725 $0 $10,153 12.50% 1.41% $41,557 $15,118 $15,218 $1,696 $0 $13,422 15.74% 1.41% $41,557 $15,118 $15,218 $1,671 $0 $13,447 15.76% 1.41% $41,557 $15,118 $15,218 $1,646 $0 $13,472 15.79% 1.41% $41,557 $15,118 $15,218 $1,621 $0 $13,497 15.82% 1.41% $41,557 $15,118 $15,218 $1,596 $0 $13,522 15.85% 1.41% $41,557 $15,118 $15,218 $1,579 $0 $13,539 15.87%
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Appendix
Table: Cash Flow
Pro Forma Cash Flow Month 1 Cash Received Cash from Operations Cash Funding Cash from Receivables Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Expenditures Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent Net Cash Flow Cash Balance $40,250 $505 $40,755 $43,370 $15,244 $58,614 $43,370 $17,734 $61,104 $43,370 $18,145 $61,515 $43,370 $21,314 $64,684 $48,245 $22,879 $71,124 $48,245 $23,588 $71,833 $48,245 $24,315 $72,560 $48,245 $23,507 $71,752 $48,245 $23,482 $71,727 $48,245 $23,457 $71,702 $48,245 $23,432 $71,677 0.00% $0 $5,000 $0 $0 $0 $0 $0 $33,313 Month 1 $0 $0 $0 $0 $0 $0 $0 $36,465 Month 2 $0 $0 $0 $0 $0 $0 $0 $45,675 Month 3 $0 $0 $0 $0 $0 $0 $0 $59,075 Month 4 $0 $0 $0 $0 $0 $0 $0 $65,271 Month 5 $0 $0 $0 $0 $0 $0 $0 $76,680 Month 6 $0 $0 $0 $0 $0 $25,000 $0 $106,762 Month 7 $0 $0 $0 $0 $0 $0 $0 $84,321 Month 8 $0 $0 $0 $0 $0 $0 $0 $85,300 Month 9 $0 $0 $0 $0 $0 $0 $0 $85,300 Month 10 $0 $0 $0 $0 $0 $0 $0 $85,300 Month 11 $0 $0 $0 $0 $0 $0 $0 $85,300 Month 12 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
$28,313 $0 $28,313
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Appendix
Table: Balance Sheet
Pro Forma Balance Sheet Month 1 Assets Current Assets Cash Accounts Receivable Inventory Other Current Assets Total Current Assets Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets Liabilities and Capital Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities Long-term Liabilities Total Liabilities Paid-in Capital Accumulated Surplus/Deficit Surplus/Deficit Total Capital Total Liabilities and Capital Net Worth Starting Balances Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
$14,653 $9,500 $0 $24,153 $209,000 $233,153 $699,150 ($49,150) ($20,188) $629,812 $862,965 $629,812
$17,133 $9,000 $0 $26,133 $208,000 $234,133 $699,150 ($49,150) ($33,512) $616,488 $850,621 $616,488
$17,436 $8,000 $0 $25,436 $207,000 $232,436 $699,150 ($49,150) ($46,819) $603,181 $835,617 $603,181
$20,552 $7,000 $0 $27,552 $206,000 $233,552 $699,150 ($49,150) ($47,230) $602,770 $836,322 $602,770
$22,094 $6,000 $0 $28,094 $204,000 $232,094 $699,150 ($49,150) ($41,135) $608,865 $840,958 $608,865
$22,776 $5,000 $0 $27,776 $202,000 $229,776 $699,150 ($49,150) ($30,982) $619,018 $848,794 $619,018
$23,531 $4,500 $0 $28,031 $199,000 $227,031 $699,150 ($49,150) ($17,560) $632,440 $859,471 $632,440
$22,724 $4,500 $0 $27,224 $196,000 $223,224 $699,150 ($49,150) ($4,112) $645,888 $869,112 $645,888
$22,700 $4,500 $0 $27,200 $193,000 $220,200 $699,150 ($49,150) $9,360 $659,360 $879,560 $659,360
$22,676 $4,500 $0 $27,176 $190,000 $217,176 $699,150 ($49,150) $22,858 $672,858 $890,033 $672,858
$22,651 $4,500 $0 $27,151 $187,000 $214,151 $699,150 ($49,150) $36,380 $686,380 $900,531 $686,380
$22,635 $4,500 $0 $27,135 $185,000 $212,135 $699,150 ($49,150) $49,919 $699,919 $912,054 $699,919
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