Longevity Healthcare Systems Case

Longevity Healthcare Systems Case Study

Longevity Healthcare Systems, Inc developed from a couple in which both are familiar and involved within the healthcare system. Kathryn is a registered nurse and her husband is a medical doctor. This is very important to note because in the beginning of the establishment of their business they were able to see an opportunity within the healthcare system that they are involved that others may not have been able to envision. They also were able to set-up their business with inside knowledge regarding the necessary protocols and regulations for such a business, and they also have expertise in clinical knowledge to operate such a business. This gave them an advantage over others who may have considered
They are unsure which submarkets to pursue in regards to nursing care and if they should expand to Indiana. They also are unsure about their pharmacy business and if they should expand it to their Toledo facilities. Lastly, they have to have a consistent marketing strategy for their nursing homes and their services, and also need a protocol for customer service to ensure all residents are happy and satisfied regardless of the quality of care in order to continue to have good standing in the community. Being pulled in all different directions can be detrimental for Longevity, as they have not completely established themselves in the current markets they are in other than their nursing home status in the Grand Rapids area. It would cost Longevity over $6 million dollars just to acquire nursing homes in South Bend and the pharmacy in Toledo, and that doesn’t include changing beds to Alzheimer’s care or subacute care. This would exceed their entire revenues from 2008, which would leave them with no capital and would require more debt, which they have decreased over the last
This is another market they need to get involved in and it fits in well with their current business of nursing homes and subacute care. The aging population and the expected dramatic increase in Alzheimer’s patients makes this market very appealing, especially since Longevity already has the space, beds, and qualifications to enter the market at a lower risk and cost level of new entrants. These patients cost is 15% less than typical nursing home patients due to decreased care. However, these patients may also have co-morbid conditions and may need use of other services, which increases profits for Longevity. The cost of converting a bed is easily recovered as previously mentioned, which makes this market a must for Longevity. It maintains their current business in the industry while diversifying using their current facilities and resources. This is another business that is very appealing to bring to the Toledo region because of the need for this care and the large supply of general nursing care and the lack of reimbursement from Medicare and Medicaid. Longevity could change 100 beds in Toledo each to subacute care and Alzheimer’s care while maintaining 80 beds for nursing care. This would cost them roughly $280,000, which they could cover with their profits from selling their pharmacy to a well-established pharmacy company with a system in place. Longevity could then fill their beds in Toledo increasing