philippines

JOSH MURRAY, KATIE DUDLEY, JOE SAUER, AND BRYANT BAKER

JV: Health Spring & St. Luke’s

Purpose of Venture

Health Spring and St. Luke’s Medical Center in the Philippines

Create a JV with Health Spring acting as a medical tourism facilitator in partnership with SLMC

Take advantage of a growing market to enhance our business and that of SLMC

Why this makes this an attractive option for Health Spring?

Economic: rising healthcare costs; entitlements a focus for budget cuts

Demographic: Baby Boomers retiring; increasing # of people on Medicare

Geographic: Philippines location to U.S., ties to U.S.; infrastructure already in place at SLMC, English-speaking population

What does Health Spring stand to gain?

Tremendous cost savings, 20-80% depending on the procedure; infrastructure already in place

Business expansion: medical tourism facilitator; increased client base

Market share, get ahead of competition in medical tourism

Possible long-term partnership with SLMC, Philippines

What does SLMC stand to gain?

Enhanced reputation as premier medical tourism destination in East Asia, world

Hire more doctors, nurses to cater to increased demand for services

Access to US insurers, possible long-term partner

Increased revenue due to new patients

Health Spring Long-Term Vision

Current focus on Medicare, Medicare Advantage, prescription drugs

Focus on wellness and preventive care; “Physician Partnership”-partner members with doctors and nurses for personal care

Establish ourselves as a Medical Tourism facilitator; partner with travel companies

SWOT

Strengths Baby

Boomers, Infrastructu

re

Weaknesses Footprint, Domestic

Needs

Opportunities Financial

Gains, Increased

Specialization.

ThreatsHealthcare

reform, Local

Resistance.

Joint Venture Considerations

Collaborative LegalHuman ResourcesIT

St. Luke’s Role

InfrastructureStaffServices

Health Spring’s Role

Policy Accommodation.Sales Training.Billing.Local Staff.

Leverage Board Experience and Hire Locally

Reasons For Local Resources

Wage rate variance - Example VP Operations $170K salary (US) vs $68K fully burdened (PH)

Relationships play key role in businessEnglish is primary medium of instruction

Executive Order 210 Minimal knowledge transfer barrier

Risk mitigation Board approval for executive hires

Board of Directors

Six members Small group eliminates unnecessary bureaucracy

Three executives from each parent company Equal representation

Unanimous decision making process Balance of power

Board Members From St. Lukes

Jose F.G. Ledesma – CEO Employed by St. Luke’s since 1981

Joven R. Cuanang, M.D.– Chief Medical Officer International advisory board for IMWell Summit Founded Stroke Society of the Philippines

Edith M. Simeon – CFO International banking experience

Board Members From HealthSpring

Herbert Fritch - CEO 35 years experience in HMO and physician

managementJ. Gentry Barden - General Counsel

Corporate and securities lawyer Seven years merger and acquisition experience

Dirk O. Wales – Chief Medical Officer 11 years experience as an officer

Three Year Plan

Year One

Establish relationships with luxury hotels and transportation services

Begin Promoting the option of medical tourism to existing customers and doctors that are covered by Health Springs

Three Year Plan

Year Two

Do public broadcast of the availability of medical tourism in the Philippines to attract new customers to join Health Springs.

Work with St. Luke's Hospital to make sure they have high class medical equipment to promote the excellent medical care offered at the hospital.

Three Year Plan

Year Three

Review the financials from the last two years and create cash flow analysis to determine if the IJV is viable for a long term partnership.

Risk Factors

Travel

Foreign Nationals Cannot Own Land

Corruption in the Filipino Government

Uncertain and Inefficient Judicial System

Questions?

References

Brandon, Emily. (2010, Feb. 16). 10 Ways Baby Boomers Will Reinvent Retirement. USNews.com. Retrieved from

http://money.usnews.com/money/retirement/articles/2010/02/16/10-ways-baby-boomers-will-reinvent-retirement

Einhorn, Bruce. (2008, March 13). Outsourcing the Patients. Bloomberg Businessweek. Retrieved from

http://www.businessweek.com/magazine/content/08_12/b4076036777780.htm

Kasier Family Foundation. Medicare Now and in the Future. Retrieved from http://www.kff.org/medicare/h08_7821.cfm

Mitchell, Deborah. (2009, Aug. 23). Health Insurance Companies Promoting Medical Tourism. Retrieved from http://www.emaxhealth.com/1275/121/33050/health-insurance-companies-promoting-medical-tourism.html

Mueller, Megg. (2010, April 6). That’s the Ticket: Insurance for Medical Tourism. Retrieved fromhttp://www.insure.com/articles/healthinsurance /medical-tourism.html

References

Mueller, Megg. (2010, April 6). That’s the Ticket: Insurance for Medical Tourism. Retrieved fromhttp://www.insure.com /articles/healthinsurance /medical-tourism.html

Porter, M., De Vera, M., Huang, B., Khan, O., Qin, Z., & Tan, A. (2008). Medical Tourism in the Philippines.

St. Luke’s Medical Center. General website. Retrieved from http://www.stluke.com.ph/

Doing Business in the Philippines: 2010 Country Commercial Guide for U.S. Companies. Retrieved from http://www.buyusainfo.net/docs/x_9327272.pdf

Does FAA provide safety oversight for international flights? Retrieved from http://www.faa.gov/passengers/international_travel/

Cuanang, Joven R. "Message from the Founding President." Stroke Society of the Philippines. Web. 15 Mar. 2011. <http://www.strokesocietyphil.org/files/chapter-1.pdf>.

"Doing Business in the Philippines -- U.S. Commercial Service Philippines." Home -- U.S. Commercial Service Your Global Business Partner. Web. 15 Mar. 2011. <http://www.buyusa.gov/philippines/en/doing_business_philippines.html>.

Experience');document.write(', Years. "PayScale - Vice President (VP), Operations Salary, Average Salaries by Hospital Setting." PayScale - Salary Comparison, Salary Survey, Search Wages. Web. 15 Mar. 2011. <http://www.payscale.com/research/US/Job=Vice_President_(VP),_Operations/Salary/by_Hospital_Setting>.

"HealthSpring - More from Medicare. More from Life. | Investor Relations | Corporate Governance - Management." HealthSpring - More from Medicare. More from Life. | Investor Relations | Investor Overview. Web. 15 Mar. 2011. <http://ir.healthspring.com/phoenix.zhtml?c=194529&p=irol-govmanage>.

"IMWell Summit." Philippines The Heart of Asia. Web. 15 Mar. 2011. <http://www.philippinesheartofasia.ph/IMWellSummit/contact.html>.

References

"Joe Ledesma Speaker :: Healthcare Reform Conference." Home Health Care Reform Summit. Web. 15 Mar. 2011. <http://www.healthcarereformsummit.com/speakers/joe-ledesma.html>.

"The Manila Times Internet Edition | OPINION Mother Tongue as Medium of Instruction." The Manila Times Internet Edition | September 23, 2009. Web. 15 Mar. 2011. <http://archives.manilatimes.net/national/2008/june/21/yehey/opinion/20080621opi1.html>.

PayScale - Salary Comparison, Salary Survey, Search Wages. Web. 15 Mar. 2011. <http://www.payscale.com>.

"PayScale - Salary Search: Job." PayScale - Salary Comparison, Salary Survey, Search Wages. Web. 15 Mar. 2011. <http://www.payscale.com/research/US/Job>.

"PayScale Philippines - Vice President (VP), Operations Commute Time Survey." PayScale - Salary Comparison, Salary Survey, Search Wages. Web. 15 Mar. 2011. <http://www.payscale.com/research/PH/Job=Vice_President_(VP),_Operations/Commute_Time>.

References