Amesbury Psychological Center

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Psychological Health Center Business Plan

Strategy and Implementation Summary

The Center will focus its market activities on two market areas: the communities of Merrimack Valley, and Southern Hew Hampshire. Services will include psychotherapy, psychopharmacology, and substance abuse/addiction services.

The target customers are the consumers of mental health services (i.e. individuals, couples, families, and groups). The composition breakdown is approximately 50% adults and 50% children, adolescents, and families. The second target customer are the payors. They are an integral piece of this turn key project. The payors are basically the gatekeepers for referrals and authorizations.

5.1 Sales Strategy

The Center's sales strategy will target potential purchasers and referral sources of our services, from:

  1. Managed Care Companies (5-6)

  2. Preferred Provider Organizations (2-3)

  3. Medical Groups (5)

  4. Community Agencies (3)

  5. Consumers/Clients

Wherever possible, our niche marketing approach will be linked to our sales strategies.

5.1.1 Sales Forecast

The following chart and table depict the Center's forecasted sales. During the first year, we expect a yearly growth rate of approximately 100%  from the previous fiscal year. Since existing associates will remain with the Center, and several associates from a closed center will join us and bring at least sixty percent of their current caseload with them, the forecast is reasonable. The Center is in the process of negotiating with Harbor Schools to provide mental health services, resulting in 3,300 additional units of service. The sales forecast is also based on the assumptions that we meet projected staffing patterns, managed care contracts are transitioned to the Center without difficulty, and a Medicaid provider number is obtained without complications.

Operationally, the Center is prepared to handle growth. Support staff is in place, as are other necessary environmental resources. The immediate problem would be to transfer patients from one center to another. Through a planned transition program being driven by the therapists, it should occur without too much difficulty or confusion.

The chart and table depict a modest 18% growth rate for the second year, and a 23% growth rate for the third year. The second year growth rate will be the result of adding additional therapy hours. The third year growth will be a result of adding therapy contracts. We are in the process of negotiating with Harbor Schools to provide on sight therapy services.

Sales Forecast
Year 1 Year 2 Year 3
Unit Sales
Psychotherapy 5,784 6,792 7,374
Psychopharmacology/MD 2,520 3,264 3,950
Psychopharmacology/CNS 1,391 1,920 2,332
Addictions/3 hr IOP 310 310 450
Addictions/1hr IOP 588 588 538
Contracts 0 0 2,000
Other 0 0 0
Total Unit Sales 10,593 12,874 16,644
Unit Prices Year 1 Year 2 Year 3
Psychotherapy $59.52 $59.52 $59.52
Psychopharmacology/MD $40.92 $40.92 $40.92
Psychopharmacology/CNS $32.55 $32.55 $32.55
Addictions/3 hr IOP $77.19 $77.19 $77.19
Addictions/1hr IOP $22.32 $22.32 $22.32
Contracts $0.00 $0.00 $59.52
Other $0.00 $0.00 $0.00
Psychotherapy $344,264 $404,260 $438,900
Psychopharmacology/MD $103,118 $133,563 $161,634
Psychopharmacology/CNS $45,277 $62,496 $75,907
Addictions/3 hr IOP $23,929 $23,929 $34,736
Addictions/1hr IOP $13,124 $13,124 $12,008
Contracts $0 $0 $119,040
Other $0 $0 $0
Total Sales $529,712 $637,372 $842,225
Direct Unit Costs Year 1 Year 2 Year 3
Psychotherapy $35.71 $35.71 $35.71
Psychopharmacology/MD $28.64 $28.64 $28.64
Psychopharmacology/CNS $19.53 $19.53 $19.53
Addictions/3 hr IOP $13.12 $27.02 $27.02
Addictions/1hr IOP $4.91 $6.47 $6.47
Contracts $0.00 $0.00 $35.71
Other $0.00 $0.00 $0.00
Direct Cost of Sales
Psychotherapy $206,558 $242,542 $263,326
Psychopharmacology/MD $72,183 $93,481 $113,128
Psychopharmacology/CNS $27,166 $37,498 $45,544
Addictions/3 hr IOP $4,068 $8,376 $12,159
Addictions/1hr IOP $2,887 $3,804 $3,481
Contracts $0 $0 $71,420
Other $0 $0 $0
Subtotal Direct Cost of Sales $312,863 $385,701 $509,057

5.2 Value Proposition

If the Center is going to compete effectively, it will need to clearly define its value-added benefits. Our goal is to meet and exceed the needs of our customers: consumers, staff and associates, payors, consultants, and other referral sources. Previously, we discussed the needs of our customer. These needs will drive the value-added philosophy and marketing strategy.

5.3 Competitive Edge

Our competitive edge is our associates and staff affiliations. Our associates and staff spread the company proposition, "our mission is to meet/exceed customer's expectations." Our affiliations with the Anna Jaques Hospital and other medical group practices allows us to interface easily with a strong referral base. Hard work, integrity, accessibility, experience, quality service, and customer satisfaction are the factors influencing our competitive edge. When the customers call the Center, they will get a real person, not a voice mail message.

5.4 Marketing Strategy

Target marketing of our services is critical to growth. Strategies will include:

  • An emphasis on customer-driven, quality service
  • Building a relationship business
  • Focusing on five behavioral health payors
  • Identify and build a niche market

Marketing tools will include: direct mail, print and audio advertising, public speaking, and relationship building with identified managed care corporations and persons.

5.4.1 Promotion Strategy

Multiple strategies will be used to promote the Center. Throughout the promotional strategy, our focus will be on selling the Center. The types of promotions will include:

  1. Participation in activities related to treated disorders at the center, e.g., National Depression Screening Day.

  2. Developing a  brochure, logo, and business cards to promote the Center.

  3. Networking with various health care providers, community agencies, and state agencies.

  4. Media advertisement, especially to announce the professional affiliation of a new associate or new program.

  5. Use of follow-up letters to referral sources.

  6. Offering informational workshops to the public.

  7. Networking with the media to facilitate articles about the Center.

  8. Join small business groups/organizations as a means of increasing public awareness.

5.4.2 Positioning Statement

It is our goal to enhance our image and reputation by being responsive, accessible, and by providing quality treatment. By building relationships, we will cultivate our image with case managers and network managers of identified managed care organizations.

5.4.3 Pricing Strategy

Pricing for the services provided by the Center is market driven. Our fee structure is based upon a survey of existing MCOs and other payors. In order to operate profitably under these prices, it is imperative that the Center monitor and control costs. Behavioral health industry watchers believe that there is at least a 15% range of variation in what certain managed care companies will pay different providers for a given service. Our goal is to obtain the highest price within the competitive range by convincing the payor that we have a service to offer which exceeds that of our competitor. A possible example of this is creative bundling.

5.5 Strategic Alliances

Strategic alliances are critical to the goals of the Center, and include selling more services and strengthening our relationship with all our customers. If we are to meet our strategic goals, we must have a strong, continued alliance with Anna Jaques Hospital. Concurrently, we must strengthen and develop our relationship with our referral networks, especially medical groups within the Anna Jaques System and the surrounding community.