Healthcare Business Plan Template
If you want to start a healthcare business or expand your current healthcare business, you need a business plan.
The following healthcare business plan template can be used to craft a business plan for a medical practice and all types of healthcare practices. As such, you can use it to create a business plan for a healthcare startup, business plans for family medicine, chiropractic, occupational health, physical therapy and/or psychology practices among others.
Healthcare Business Plan Example
I. Executive Summary
Business Overview
[Company Name] is a family medical clinic located in [Location]. It started with the goal of providing easy access to good quality health service, especially to those members of the community with low to moderate income. We offer general and preventative health care for all ages in this area and the surrounding communities.
Our medical practitioners and supporting staff are well-trained and have a passion for helping improve the health and well-being of our clients. We serve our patients not just with our knowledge and skills but also with our hearts.
Products Served
[Company Name] will focus on providing primary care services to every member of the family from infants to adults. Our services range from gynecology, pediatrics, minor procedures, cardiology, and preventative health.
Customer Focus
[Company Name] will primarily serve the community within a 20-mile radius of our location. The demographics of these customers are as follows:
- Families and residents of the area
- Working individuals, including low-income workers
- Business establishments near our location that offer health benefits to their employees
The [Company Name] focuses on giving the local community access to high quality medical services. In order to achieve this goal, [Company Name] will build relationships within the residential and business communities.
Management Team
[Company Name]’s most valuable asset is the expertise and experience of its founder, [full name]. [First name] has been a licensed family doctor for 20 years now. He spent the most recent portion of his career on medical mission trips where he learned that a lot of people are not privileged to have access to quality medical services. [Founder’s name] will be responsible for ensuring the general health of his patients and creating a viable and profitable business medical practice.
[Company name] will also employ nurses, expert medical staff, and administrative assistants that also have a passion for healthcare.
Success Factors
[Company Name] is uniquely qualified to succeed due to the following reasons:
People-Focused-It is a company that is focused on educating and taking care of its patients’ wellbeing. [Company Name] will educate patients on the importance of preventative care and yearly checkups, and it will Implement an aggressive and accurate follow-up system to remind patients about regular check-ups. This will help the company build a strong relationship with the community, earning their trust and loyalty.
Staff and Office Organization-[Company Name] recognizes that the office staff is as crucial, if not, more crucial than the physician(s) in the success of the business. It aims to employ detail-oriented staff and create a streamlined office system to minimize patients’ waiting time and maximize the clinic’s potential.
Financial Highlights
[Company Name] is seeking a total funding of $300,000 of debt capital to open its clinic. The capital will be used for funding capital expenditures and location build-out, acquiring basic medical supplies and equipment, hiring initial employees, marketing expenses and working capital.
Specifically, these funds will be used as follows:
- Clinic design/build: $60,000
- Medical Supplies and Equipment: $130,000
- Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Topline projections over the next years are as follows:
| Financial Summary | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Revenue | $965,742 | $1,878,611 | $2,718,300 | $3,477,900 | $4,285,228 |
| Total Expenses | $390,241 | $630,018 | $931,935 | $1,171,906 | $1,429,992 |
| EBITDA | $575,501 | $1,248,593 | $1,786,365 | $2,305,994 | $2,855,237 |
| Depreciation | $8,720 | $8,720 | $8,720 | $8,720 | $8,720 |
| EBIT | $566,781 | $1,239,873 | $1,777,645 | $2,297,274 | $2,846,517 |
| Interest | $5,077 | $4,442 | $3,807 | $3,173 | $2,538 |
| Pre-Tax Income | $561,705 | $1,235,431 | $1,773,838 | $2,294,101 | $2,843,978 |
| Income Tax Expense | $196,597 | $432,401 | $620,843 | $802,935 | $995,392 |
| Net Income | $365,108 | $803,030 | $1,152,995 | $1,491,166 | $1,848,586 |
| Net Profit Margin | 38% | 43% | 42% | 43% | 43% |
II. Company Overview
Who is [Company Name]?
[Company Name] is a family medical clinic located in [Location]. We offer general and preventative health care for all ages in this area and the surrounding communities.
Our medical practitioners and supporting staff are well-trained to help improve the health and well-being of our clients and have compassion for those who need comfort and healing. We serve our patients not just with our knowledge and skills, but also with our hearts.
[Company Name]’s History
[Founder] started the clinic with the goal of providing easy access to good quality health service, especially to those members of the community with low to moderate income. After years of planning, he finally started to build [Company Name] in [year]. He gathered a group of professionals to fund his project and was able to incorporate and register [Company Name] with their funding support.
Since incorporation, the Company has achieved the following milestones:
- Found clinic space and signed Letter of Intent to lease it
- Developed the company’s name, logo and website
- Hired a contractor for the office build-out
- Determined equipment and fixture requirements
- Began recruiting key employees with previous healthcare experience
- Drafted marketing campaigns to promote the clinic
[Company Name]’s Products/Services
[Company Name] will provide general care for all ages, as well as preventative health and minor surgical procedures, creating a complete healthcare solution. In addition to check-ups, immunizations and well-being assessments, we will also provide procedures including, but not limited to mole removals, biopsies, and trigger point injections, and much more. The costs will depend upon the materials used, the physician’s time and the amount designated for each procedure.
Our healthcare philosophy is that optimal health and performance can be attained through the proper balance of exercise, nutrition, and education. We want to educate our patients as well as treat them. Therefore, our services will also provide group classes and teaching sessions for our patients. Our goal is to create the most well-rounded experience for each patient in order to optimize their health.
[Company Name] will maintain privacy according to HIPAA regulations. All patients will be welcome, including the ones with no insurance. Our clinic will hold no prejudice to race, creed, color or socioeconomic status. Everyone will be welcome for great medical care.
We will also provide the following services, among others:
- Gynecology: PAP Tests, Annual Well Women Exam and Family Planning
- Pediatrics: Infant Care, Annual Physicals and Immunizations
- Minor Procedures: Stitches, Casts/splints, Skin biopsies, Cyst removals and Growth lacerations
- Health and Wellness: Weight Loss strategies, Nutrition guidance, Hormone Balance and Preventive and Routine Services
III. Industry Analysis
The Primary Care/Family Doctors industry is expected to continue to grow at a steady pace over the next five years.
A major driver of the industry is the rise of chronic illnesses, which are disproportionately prevalent in older adults, has risen significantly due to demographic shifts brought on by the aging of the baby-boomer population. The number of individuals aged 65 and older has grown at an annualized rate of 3.3% over the past five years.
Rising total health expenditure and increasing federal funding for Medicare and Medicaid were also principal drivers of revenue during the current period. Total health expenditure, which measures private and public spending on health, has grown at an annualized rate of 3.7% over the past five years. In addition, federal funding for Medicare and Medicaid has grown at an annualized rate of 3.9% during the same period. Broadly speaking, an aging US population and longer life expectancies brought about by advancements in the medical field fueled demand for primary care services.
IV. Customer Analysis
Demographic Profile of Target Market
[Company Name] will serve the residents of [company location] and the immediately surrounding areas as well as those who work in [company location].
The area we serve is populated mostly by the working middle class and low income families; as a result, they are in need of the services that we offer, and are looking for accessible medical care.
The precise demographics of the town in which our company will cater is as follows:
| Riverdale | Santa Cruz | |
|---|---|---|
| Total Population | 26,097 | 10,725 |
| Square Miles | 6.89 | 3.96 |
| Population Density | 3,789.20 | 2,710.80 |
| Population Male | 48.04% | 48.84% |
| Population Female | 51.96% | 51.16% |
| Target Population by Age Group | ||
| Age 54-60 | 3.68% | 3.52% |
| Age 60-69 | 5.22% | 4.50% |
| Age 70-80 | 13.80% | 13.91% |
| Age 81 and older | 18.09% | 18.22% |
| Target Population by Income | ||
| Income $50,000 to $74,999 | 11.16% | 6.00% |
| Income $75,000 to $99,999 | 10.91% | 4.41% |
| Income $100,000 to $124,999 | 9.07% | 6.40% |
| Income $125,000 to $149,999 | 9.95% | 8.02% |
| Income $150,000 to $199,999 | 12.20% | 11.11% |
| Income $200,000 and Over | 32.48% | 54.99% |
Customer Segmentation
Our clinic is a general family practice, and will treat patients of all ages, incomes, physical abilities, races, and ethnicities. As a family clinic, there is no need to create marketing materials targeted at only one or two of these groups, but we can appeal to all with a similar message.
V. Competitive Analysis
Direct & Indirect Competitors
The following businesses are located within a 5-mile radius of [Company Name], thus providing either direct or indirect competition for customers:
City Medical
City Medical is a membership-based, primary-care practice in the heart of the city. City Medical offers a wide range of primary-care services for patients who subscribe to the practice for an annual fee. Patients enjoy personalized care, including office visits, as well as the diagnosis and treatment of common health problems and primary-, preventative-, and urgent-care services. The patient membership fee covers the services listed below and most care received in-office. However, some additional services such as lab testing and vaccinations are billed separately.
Bay Doctors
Bay Doctors is a primary care practice that provides highly personalized medical care in office or patients’ homes. Bay Doctors includes a team of dedicated healthcare professionals with dual residency in Emergency Medicine and Internal Medicine. The practice offers same day/next day appointments, telemedicine, office visits and home visits. Services offered by Bay Doctors include: Primary Care, Urgent Care, House Calls, Virtual Visits and IV Vitamin Drips.
Community Care
Established in 1949, Community Care is a non-profit regional healthcare provider serving the city and surrounding suburbs. This facility offers the following services:
- 24-hour emergency care
- 8 emergency department exam rooms
- Dedicated ambulance bay for medical emergencies
- Critical care support
- 15 private inpatient beds
- New, state-of-the-art diagnostic imaging services, including a 64-slice CT, X-ray and ultrasound
- On-site laboratory with modern analyzers and instrumentation
- A state-of-the-art surgical suite
Competitive Pricing
Competitor pricing is highly variable depending on the service provided and healthcare coverage.
Competitive Advantage
[Company Name] enjoys several advantages over its competitors. These advantages include:
- Location: [Company Name]’s location is near the center of town. It’s visible from the street with many people walking to and from work on a daily basis; giving them a direct look at our clinic, most of which are part of our target market.
- Patient oriented service: [Company Name] will have a staff that prioritizes the needs of the patients and educating them on the proper way on how to take care of oneself.
- Management: [Founder’s Name] has a genuine passion to want to help the community and because of his previous experience, he is fully equipped and over-qualified to open this practice. His unique qualifications will serve customers in a much more sophisticated manner than [Company Name’s] competitors.
- Relationships: Having lived in the community for 25 years, [Founder’s Name] knows many of the local leaders, newspapers and other influences. Furthermore, he will be able to draw from his ties to the community in order to build up a heavy asset base in a short amount of time.
VI. Marketing Plan
The [Company Name] Brand
The [Company name] brand will focus on the Company’s unique value proposition:
- Client-focused healthcare services, where the Company’s interests are aligned with the customer
- Service built on long-term relationships
- Big-hospital expertise in a small-clinic environment
Promotions Strategy
Referrals
[Company name] understands that the best promotion comes from satisfied customers. The Company will encourage its clients to refer their friends and family by providing healthcare benefits for every new client produced. This strategy will increase in effectiveness after the business has already been established.
Internet
[Company name] will invest resources in two forms of internet promotion—organic search engine optimization and pay-per-click advertising. The Company will develop its website in such a manner as to direct as much traffic from search engines as possible. Additionally, it will use highly-focused, specific keywords to draw traffic to its website, where potential clients will find a content-rich site that presents [Company name] as the trustworthy, well-qualified healthcare provider that it is.
Publications
[Company name] will place print advertisements in key local publications, including newspapers, area magazines, and local sport programs. Additionally, the Company will print brochures and place them in specific locations frequented by target individuals, such as stores and professional service providers.
Direct Mail
The Company will use a direct mail campaign to promote its brand and draw clients, as well. The campaign will blanket specific neighborhoods with simple, effective mail advertisements that highlight the credentials and credibility of [Company Name].
Pricing Strategy
[Company Name]’s pricing will be significantly lower than big hospitals. Over time, client testimonials will help to maintain our client base and attract new patients. Furthermore, we will be able to provide discounts and incentives for lower income families by connecting with foundations and charities from people who are interested in helping.
VII. Operations Plan
Functional Roles
[Company name] will carry out its day-to-day operations primarily on an appointment basis. Clients will make regularly scheduled appointments to validate their consultation, medical procedure, and other health-related transactions. These will primarily occur in-clinic. For emergency purposes, appointments can be conducted over the telephone.
[Founder’s name] will work on an as-needed basis, but can be expected to be present in the office during normal business hours. The company will also employ an administrative assistant who will also support marketing and client relationship development efforts.
Milestones
[Company name]’s long term goal is to become the number-one local family medicine clinic in the [city] area. We seek to be a household name and the standard by which other clinics are judged. We seek to do this by ensuring customer satisfaction and developing a loyal and successful clientele.
The following are a series of path steps that will lead to the vision of long term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:
| Date | Milestone |
|---|---|
| [Date 1] | Finalize lease agreement |
| [Date 2] | Design and build out [Company Name] location |
| [Date 3] | Hire and train initial staff |
| [Date 4] | Kickoff of promotional campaign |
| [Date 5] | Reach break-even |
| [Date 6] | Add second location |
VIII. Management Team
Management Team
[Company Name]’s most valuable asset is the expertise and experience of its founder, [full name]. [First name] has been a licensed family doctor for 20 years now. He spent the most recent portion of his career on medical mission trips where he learned that a lot of people are not privileged to have access to quality medical services. [Founder’s name] will be responsible for ensuring the general health of his patients and creating a viable and profitable business medical practice.
[Company name] will also employ nurses, expert medical staff, and admin assistants that also have the heart to help the community.
Hiring Plan
[Founder’s Name] will serve as the company CEO and president. In order to launch the business we need the following additional personnel:
- Full-time Administrative Assistant
- Maintenance Personnel
- Medical Practitioners (Nurses, Doctors, etc)
IX. Financial Plan
Revenue and Cost Drivers
[Company Name]’s revenues will come primarily from medical services rendered. Labor expenses are also key cost drivers. [Founder’s Name] and all the company’s employees will earn a competitive base salary. The lease on the office location will be the next largest cost.
Ongoing marketing expenditures are also notable cost drivers for [Company Name].
Capital Requirements and Use of Funds
[Company Name] is seeking a total funding of $300,000 of debt capital to open its clinic. The capital will be used for funding capital expenditures and location build-out, acquiring basic medical supplies and equipment, hiring initial employees, marketing expenses and working capital.
Specifically, these funds will be used as follows:
- Clinic design/build: $60,000
- Medical Supplies and Equipment: $130,000
- Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even
Key Assumptions
The following table reflects the key revenue and cost assumptions made in the financial model.
| Number of patients per month | Per location |
|---|---|
| Year 1 | 1200 |
| Year 2 | 1300 |
| Year 3 | 1450 |
| Year 4 | 1550 |
| Year 5 | 1750 |
| Annual Lease (per location) | $50,000 |
5 Year Annual Income Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Product/Service A | $151,200 | $333,396 | $367,569 | $405,245 | $446,783 | |
| Product/Service B | $100,800 | $222,264 | $245,046 | $270,163 | $297,855 | |
| Total Revenues | $252,000 | $555,660 | $612,615 | $675,408 | $744,638 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $57,960 | $122,245 | $122,523 | $128,328 | $134,035 | |
| Lease | $60,000 | $61,500 | $63,038 | $64,613 | $66,229 | |
| Marketing | $20,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Salaries | $133,890 | $204,030 | $224,943 | $236,190 | $248,000 | |
| Other Expenses | $3,500 | $4,000 | $4,500 | $5,000 | $5,500 | |
| Total Expenses & Costs | $271,850 | $412,775 | $435,504 | $454,131 | $473,263 | |
| EBITDA | ($19,850) | $142,885 | $177,112 | $221,277 | $271,374 | |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 | |
| EBIT | ($56,810) | $105,925 | $140,152 | $184,317 | $234,414 | |
| Interest | $23,621 | $20,668 | $17,716 | $14,763 | $11,810 | |
| PRE-TAX INCOME | ($80,431) | $85,257 | $122,436 | $169,554 | $222,604 | |
| Net Operating Loss | ($80,431) | ($80,431) | $0 | $0 | $0 | |
| Income Tax Expense | $0 | $1,689 | $42,853 | $59,344 | $77,911 | |
| NET INCOME | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 | |
| Net Profit Margin (%) | - | 15.00% | 13.00% | 16.30% | 19.40% |
5 Year Annual Balance Sheet
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $21,000 | $23,153 | $25,526 | $28,142 | $31,027 | |
| Total Current Assets | $37,710 | $113,340 | $184,482 | $286,712 | $423,416 | |
| Fixed assets | $246,450 | $246,450 | $246,450 | $246,450 | $246,450 | |
| Depreciation | $36,960 | $73,920 | $110,880 | $147,840 | $184,800 | |
| Net fixed assets | $209,490 | $172,530 | $135,570 | $98,610 | $61,650 | |
| TOTAL ASSETS | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $317,971 | $272,546 | $227,122 | $181,698 | $136,273 | |
| Accounts payable | $9,660 | $10,187 | $10,210 | $10,694 | $11,170 | |
| Total Liabilities | $327,631 | $282,733 | $237,332 | $192,391 | $147,443 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| Total Equity | ($80,431) | $3,137 | $82,720 | $192,930 | $337,623 | |
| TOTAL LIABILITIES & EQUITY | $247,200 | $285,870 | $320,052 | $385,322 | $485,066 |
5 Year Annual Cash Flow Statement
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | |||||
| Net Income (Loss) | ($80,431) | $83,568 | $79,583 | $110,210 | $144,693 |
| Change in working capital | ($11,340) | ($1,625) | ($2,350) | ($2,133) | ($2,409) |
| Depreciation | $36,960 | $36,960 | $36,960 | $36,960 | $36,960 |
| Net Cash Flow from Operations | ($54,811) | $118,902 | $114,193 | $145,037 | $179,244 |
| CASH FLOW FROM INVESTMENTS | |||||
| Investment | ($246,450) | $0 | $0 | $0 | $0 |
| Net Cash Flow from Investments | ($246,450) | $0 | $0 | $0 | $0 |
| CASH FLOW FROM FINANCING | |||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 |
| Cash from debt | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| Net Cash Flow from Financing | $317,971 | ($45,424) | ($45,424) | ($45,424) | ($45,424) |
| SUMMARY | |||||
| Net Cash Flow | $16,710 | $73,478 | $68,769 | $99,613 | $133,819 |
| Cash at Beginning of Period | $0 | $16,710 | $90,188 | $158,957 | $258,570 |
| Cash at End of Period | $16,710 | $90,188 | $158,957 | $258,570 | $392,389 |
