A hospital and a Native American Nation were evaluating ways to partner and better serve their local Oklahoma community. The entities wanted to understand the feasibility of and the facility implications associated with joint venturing to establish a micro-hospital in the community.
Catalyst developed a demographic profile of the community, conducted a market and competitor analysis, and studied healthcare service utilization trends for emergency, inpatient and surgical services in the community. Overlaying square footage requirements, construction cost implications, and various market capture scenarios, it became apparent that there were significant challenges associated with developing a typical micro-hospital in the community.
The low population density and presence of substitutes and competitors in the market limited the likelihood of achieving the market share required to achieve a sufficient return on investment. Recognizing that the two entities were interested in other synergistic approaches, Catalyst explored different micro-hospital models that could improve the viability of developing a micro-hospital in the market, as well as alternative service models that would meet the entities’ strategic and financial goals. Throughout the process, Catalyst weighed the relative advantages and disadvantages of establishing a micro-hospital in the community for each entity; presenting options that had a synergistic effect for both.