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October 2014 Winning Ingredient For ASC’s 1. OrthoNOW™ The Opportunity Forbes Magazine July 21, 2014 Issue: “Drive Thru Healthcare, How McDonald’s Inspired.

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Presentation on theme: "October 2014 Winning Ingredient For ASC’s 1. OrthoNOW™ The Opportunity Forbes Magazine July 21, 2014 Issue: “Drive Thru Healthcare, How McDonald’s Inspired."— Presentation transcript:

1 October 2014 Winning Ingredient For ASC’s 1

2 OrthoNOW™ The Opportunity Forbes Magazine July 21, 2014 Issue: “Drive Thru Healthcare, How McDonald’s Inspired an Urgent Care Gold Rush” “10,000 urgent care clinics across the US handling 160,000,000 patient visits a year” 81% of urgent care clinics offer basic orthopedic services “The Franchise Model Fits Urgent Care Well” “The Long Term Trends are undeniable, this market is going to shift toward a handful of large players”

3 Outline 1.OrthoNOW Background 2.Business Model 3.Orthopedic Urgent Value Proposition 4.Franchise Ownership Options 5.Why OrthoNOW Franchise Model Option? 6.Marketing Collaterals 7.Steps to Secure an Exclusive Franchise Geography 2 3

4 OrthoNOW Background

5 OrthoNOW™ Corporate Corporate Background: ❖ Headquartered in Doral, Florida (greater Miami area) ❖ Privately funded ❖ Management team hired- Dec. ‘13 -Combined 130+ years orthopedic industry experience ❖ Only Ortho Urgent Care Franchise Business ❖ Franchise commercialization - Jan. ’14 ❖ 10 Franchises sold, 30-40 deals in pipeline covering 13 states

6 OrthoNOW™ Flagship Clinic- Doral, FL  -  Opened Urgent Care Model- May 2013  Free Standing Orthopedic Urgent Care Center  Profitable Month 5  Compounded Monthly Patient Census Growth Rate (May 13 – May 14)- 8%  ARPwave Introduced in Jan. 14 – Doubles Monthly Patient Census By Month 4  Strategic Partnerships: ARPwave, Esaote, Concussion Mgmt, Quantus Solutions, DME

7 Business Model Overview

8 ❖ Stand-alone urgent care model vs. extended hours clinic ❖ Orthopedic sub-specialties included: ❖ Upper Extremity ❖ Foot & Ankle ❖ Orthopedic Trauma ❖ Sports Medicine ❖ Spine ❖ Utilizes orthopedically trained PA’s as initial patient contact ❖ 2,000 - 2,500 square feet requirement ❖ Hours of operation (varies by location) ❖ M & W: 10a - 10p ❖ T, Th, F: 10a - 7p ❖ S: 9a - 2p 7 8

9 OrthoNOW™ Preferred Staffing Model ❖ Medical Director – Orthopedic Surgeon (1 PT) ❖ Physician Extenders - Ortho PA-C (1 FTE 1PT) ❖ Medical Assistant/Xray Tech (1 FTE 1 PT) ❖ Office Manager/Business Development (1 FTE) ❖ Front Desk (1 FTE 1 PT) ❖ Check-Out (1 FTE, 1 PT) ❖ Collections/Billing (1 FTE) 23 9

10 Urgent Care Alternative: Extended Hours Clinic Pros: Vertical Integration, Utilize Existing space, Equipment, and Employees Less Costly Quicker to Market Feeder Source for Integrated Network-Downstream Revenue Cons: Feeds off existing patient base Not a practice growth model Cannot Bill at Urgent Care Rates Less profitable

11 OrthoNOW Model- Pros & Cons Pros: Captures Competitive Practice Patients - Practice Grower Most Profitable Business Alternative Feeder Source for Integrated Network–Captures Significant Downstream Revenue- ASC, Rehab, Imaging Cons: Added Cost of Build Out Longer Time to Open Higher Upfront Business Investment

12 Value Proposition

13 Why Is OrthoNOW™ A Good Investment? 2929 Patient Benefits: -Convenience -Economical -Quality Care Ortho Group Practice: -Patient Expansion New Patients -Competitive Tool -Feeder Source- Integrated Network -Revenue Source Insurance Co’s: -Economics -Patient Satisfaction -One Stop Shopping Orthopedic Urgent Care is Here to Stay 13

14 OrthoNOW™ Cost VS ER/OCC Med for “Maximum Medical Improvement”

15 Strategic Importance to Orthopedic Group Practice 1. Patient Magnet 1. Patient Magnet- Vehicle to Capture Competitive Patients 2. Feeder Source 2. Feeder Source for Integrated Network of ASCs, Rehab Centers, Imaging Centers, Pain Management 15 But Not All Orthopedic Urgent Care Centers Are Created Equally

16 OrthoNOW™-Patient Flow Model “Feeding the Integrated Network”

17 10 Data covers 7 month period OrthoNOW™ Average Surgical Referrals by Type 17

18 Assumed Incremental Revenue to ASC 11 OrthoNOW™ volume (average)Average 400 patients / month Surgical cases referred from OrthoNOW™65 case / month % referred to ASC16% Average reimbursement per ortho surgical case in ASC $3,000 Monthly incremental cases65 Monthly incremental net revenue$195,000 Annual incremental net revenue$2,340,000 Monthly profit @ 45% - 60% profit margin$87,750 - $117,000 Annual profit @ 45% - 60% profit margin$1,053,000 - $1,404,000 18

19 OrthoNOW Franchise Ownership Options

20 Franchise Ownership Options ❖ Single Franchise ❖ Exclusive territory given based on population density ❖ Best for one-off locations that don’t mind owners of other OrthoNOW™ centers in their market ❖ Area Development Agreement ❖ Best option to draw from larger patient population ❖ OrthoNOW™ gives franchisee exclusive territory rights ❖ Commitment required to open multiple sites in geographical location 12 20

21 OrthoNOW™ vs Go It Alone CategoryFranchise CostGo It Alone Year One Franchise Fee$45,000$0 TrademarksIncluded$2,000 Legal ContractsIncluded$6,000 Branding - AdvertisingIncluded$18,000 Purchasing DiscountsIncluded$10,000 Multi – Location ReportingIncluded$2,500 Insurance AgreementsIncluded$6,000 Staff TrainingIncluded$15,000 Operations – P & P ManualIncluded$10,000 Marketing CollateralsIncluded$12,000

22 OrthoNOW™ vs Go It Alone Con’t. CategoryFranchise CostGo It Alone Year One i-Phone Patient AppIncluded$40,000 Business MentoringIncluded$7,000 PR/Press ReleasesIncluded$6,500 Web Site Design - MaintenanceIncluded$6,000 Social Media PresenceIncluded$3,000 Ongoing SupportIncluded$10,000 Refresher TrainingIncluded$7,500 Quarterly BP MeetingsIncludedTBD Total$45,000$161,500 $116.5k Savings

23 Why the OrthoNOW Franchise Model?

24 OrthoNOW™ vs Go It Alone Enter At Your Own Risk

25 Detailed Preparation Prior to the Launch of the Franchise

26 Every Aspect of the New Business is Detailed and Planned Training HR IT Credentialing Billing Operations Marketing …and more!

27 OrthoNOW™ Franchise Services-Pre Opening GrandOpening

28 OrthoNOW™ Franchise Services- Post Grand Opening Revenue Stream Portfolio Management Develop Strong Alternative Revenue Streams Feeder Source for Integrated Network Best Practices Marketing

29 OrthoNOW™ Entrepreneur Magazine’s hottest franchises for 2014: OrthoNOW™ Recognized in the December 2013 - Top 10 Franchise Categories 29

30 Conclusion- The Winning Formula 26% Patient Referral to Family and Friends 16% of Patients Referred to for Surgery 21% for Imaging 25% to Rahab

31 Thank You ❖ More information @ ❖ Tom Ferro- President: (732) 865-5983 ❖ Mike Carr- VP Sales & Marketing: (828) 553-1245 31

32 Ortho Urgent Care- Mkt Perspective New York Times - “Race Is On To Profit From Rise Of Urgent Care” 07-09-14 – “Once derided as “Doc in a Box” medicine, urgent care has mushroomed into an estimated $14.5 billion business” “Insurance Giant Humana paid $800 million in 2010 to buy Concentra with over 300 clinics”

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