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Utilizing the assumptions in A, please build a 3-statement financial model (income statement, balance sheet, and cash flow) for the launch and ramp of a new market over 36 mo (3-year forecast)

Outline any incremental assumptions made in your analysis and provide an overview of the return on investment at maturity for a new market compared to standup cost and startup losses

Provide an overview of what an ideal in-house accounting & finance team would look like over the next two years assuming the parameters in B below

Include staffing assumptions over time (roles & levels) and key areas of further diligence you would want to perform to refine your thinking

What would your initial 30-60-90 day plan look like?

Given the details from A and B and your knowledge of multisite healthcare operations, what are the key financial and operational KPIs that you would report on to management and the Board of Directors?

Assumptions

A Single Clinic Details

10 therapists who see 25 clients / week. Therapists are compensated at $70 per visit

8 prescribers who see 150 clients per month and are compensated at $135,000 annually. Prescribers provide medication management services

Therapy visits are reimbursed at $125 per visit.

Medication management visits with prescribers are reimbursed at $150 per visit

Clinics are managed by a Clinical Director who does not see patients and is compensated $125,000 annually

Each clinic includes an hourly front-desk staff member who is paid $20 / hour and averages 40 hours per week

4% bad debt

EMR costs of $100 per provider per month

Outsourced billing costs of 4% of revenue per month

Office specs: 5,000 sq. ft at $25 per foot annual rent costs

$5,000 of miscellaneous monthly office expenses

$200,000 capex per clinic, 10-year useful life

$50,000 pre-opening costs per clinic

New clinics ramp to maturity over 12 months

Market Details

Mature market consists of 10 clinics, with a new clinic opening every 3 months

Market-level staff consists of a Market President, VP Clinical Operations, and Business Development representative compensated in aggregate at $600,000

This Market-level team is fully staffed day 1 - Each clinic is supported by .25 recruiters, all of whom are hired as full-time staff compensated at $75,000 annually

Other Relevant Assumptions

Average reimbursement timeline of 45 days

Outstanding payables of 6% of revenue

Straight line depreciation

15% employee benefits load

Clinical employees average 3 weeks of vacation and 10 paid holidays

B We are building an in-house accounting and finance team to support accelerated growth across multiple markets. This team will replace the current outsourced accounting vendor The business will grow from 1 market in 2022 to 3 markets in 2023 and 6 markets by the end of 2024 (10 clinics / market)

Please consider traditional accounting functions as well as forecasting / budgeting support, Board reporting, business analytics, and other staff needed to support high-quality data and analytics

Assume revenue cycle is a separate function that does not sit within the accounting and finance organization