National HealthCare Corporation (NHC): Business Model Canvas [11-2024 Updated]

In the evolving landscape of healthcare, understanding the business model of National HealthCare Corporation (NHC) reveals how they deliver comprehensive senior healthcare services while navigating the complexities of the industry. NHC's strategic partnerships with Medicare, Medicaid, and various healthcare providers, alongside their commitment to high-quality patient care, positions them as a key player in long-term and short-term care solutions. Explore the intricacies of their Business Model Canvas to uncover the essential components that drive their success in meeting the needs of seniors and their families.

National HealthCare Corporation (NHC) - Business Model: Key Partnerships

Collaborations with Medicare and Medicaid

National HealthCare Corporation (NHC) derives a significant portion of its revenue from government programs. For the three months ended September 30, 2024, Medicare accounted for approximately 30% of net patient revenues, while Medicaid represented 33%. NHC received supplemental Medicaid payments totaling $5,267,000 for Q3 2024, an increase from $4,232,000 in Q3 2023. For the nine months ended September 30, 2024, NHC recorded $11,314,000 in supplemental Medicaid payments compared to $15,362,000 for the same period in 2023.

Partnerships with Healthcare Providers

NHC operates skilled nursing facilities, assisted living, and independent living facilities, forming partnerships with various healthcare providers. As of September 30, 2024, NHC owned and operated 15 skilled nursing facilities and additional assisted and independent living facilities through the acquisition of the White Oak portfolio. The total capacity from this acquisition includes 1,928 licensed skilled nursing beds. The average census at owned and leased skilled nursing facilities was 88.3% for Q3 2024.

Alliances with Insurance Companies

NHC collaborates with various insurance companies to facilitate patient care and reimbursement. In Q3 2024, managed care revenues accounted for 9% of net patient revenues. The company also engages in private pay arrangements, which constituted 28% of net patient revenues for the same period. The diversity of payer sources helps NHC mitigate risks associated with changes in reimbursement rates from government programs.

Relationships with Pharmaceutical Suppliers

NHC maintains contracts with pharmaceutical suppliers to ensure access to necessary medications for its patients. The White Oak portfolio acquisition included a long-term care pharmacy, enhancing NHC's ability to manage pharmaceutical needs efficiently. This integration supports NHC in providing comprehensive care while controlling costs associated with medication procurement.

Contracts with Staffing Agencies

NHC has established relationships with staffing agencies to address workforce requirements, particularly in skilled nursing facilities. The agency staffing expense decreased by approximately 60% for the three months ended September 30, 2024, compared to the same period in 2023. This reduction indicates NHC's efforts to stabilize its workforce while managing costs effectively.

Key Partnership Type	Details	Financial Impact
Medicare	30% of net patient revenues	$328,674,000 net patient revenues for Q3 2024
Medicaid	33% of net patient revenues	$5,267,000 supplemental payments in Q3 2024
Managed Care	9% of net patient revenues	Part of $328,674,000 net patient revenues for Q3 2024
Pharmaceutical Suppliers	Long-term care pharmacy integration	Cost control on medication procurement
Staffing Agencies	Agency staffing expense	60% decrease in agency staffing expense in Q3 2024

National HealthCare Corporation (NHC) - Business Model: Key Activities

Operating skilled nursing facilities

As of September 30, 2024, National HealthCare Corporation (NHC) reported net patient revenues from inpatient services at approximately $790,664,000 for the nine months ended September 30, 2024, marking an increase from $706,795,000 in the same period of the previous year.

The average census at owned and leased skilled nursing facilities was 88.6% for the nine months ended September 30, 2024, compared to 87.8% for the same period in 2023. The composite skilled nursing facility per diem increased by 7.7% year-over-year.

Providing homecare and hospice services

For homecare and hospice services, NHC reported net patient revenues of $103,751,000 for the nine months ended September 30, 2024, up from $97,822,000 in the prior year. The overall increase in revenues was attributed to improved service delivery and patient care protocols.

The company recognized revenue based on the number of service days provided, which reflects the operational efficiency in managing homecare and hospice services.

Managing healthcare facilities

NHC manages multiple healthcare facilities, including skilled nursing and assisted living facilities. In 2024, NHC acquired the White Oak portfolio, which includes 15 skilled nursing facilities, 2 assisted living facilities, and 4 independent living facilities. This acquisition added 1,928 licensed skilled nursing beds and enhanced NHC's operational footprint in South Carolina and North Carolina.

The management of these facilities is critical for maintaining quality care and ensuring compliance with healthcare regulations, which is a significant aspect of NHC's operations.

Conducting patient assessments and care planning

NHC emphasizes the importance of conducting thorough patient assessments to develop personalized care plans. This process includes evaluating patient needs and coordinating with healthcare professionals to ensure effective treatment. The company utilizes data-driven approaches to enhance the accuracy of assessments and optimize care delivery.

As part of its strategic initiatives, NHC has invested in digital tools that facilitate real-time patient monitoring and care adjustments, contributing to improved patient outcomes.

Ensuring regulatory compliance

Regulatory compliance is a critical activity for NHC, ensuring adherence to federal and state healthcare laws. The company allocates resources to maintain compliance with regulations such as those set by Medicare and Medicaid. In the nine months ended September 30, 2024, NHC faced a 26.3% effective income tax rate, reflecting its commitment to legal compliance and financial transparency.

The ongoing training and development programs for staff are designed to uphold compliance standards and improve the quality of care provided.

Key Activity	Revenue (9M 2024)	Average Census	Per Diem Increase	Compliance Rate
Skilled Nursing Facilities	$790,664,000	88.6%	7.7%	26.3%
Homecare and Hospice Services	$103,751,000	N/A	N/A	N/A
White Oak Portfolio Acquisition	N/A	1,928 beds	N/A	N/A

National HealthCare Corporation (NHC) - Business Model: Key Resources

Licensed healthcare professionals

National HealthCare Corporation employs a substantial number of licensed healthcare professionals, crucial for delivering quality care. As of September 30, 2024, NHC reported over 12,000 employees, of which approximately 2,500 are licensed nurses and nurse practitioners.

Medical equipment and facilities

NHC operates a comprehensive network of healthcare facilities. The company owns and operates 75 skilled nursing facilities, 18 assisted living facilities, and 7 independent living facilities across eight states. This includes a recent acquisition of the White Oak portfolio, which added 15 skilled nursing facilities and 2 assisted living facilities, contributing to a total of 1,928 licensed skilled nursing beds.

Technology systems for patient management

NHC invests significantly in technology systems to enhance patient management and operational efficiency. As of 2024, the company has implemented electronic health record (EHR) systems across all its facilities, improving patient data management and care coordination. The investment in technology is estimated to be around $5 million annually.

Financial resources for operational needs

NHC's financial position is robust, with total assets of approximately $1.7 billion as of September 30, 2024. The company reported net operating revenues of $1.065 billion for the nine months ended September 30, 2024, reflecting an 11.6% increase year-over-year. Additionally, total cash and cash equivalents stood at $84.8 million.

Brand reputation in senior care

NHC has established a strong brand reputation in senior care, known for quality services and patient-centered care. The company has received numerous accolades, including a 4.5 out of 5 rating on senior care review platforms, which significantly enhances its competitive positioning in the market.

Key Resource	Details
Licensed Healthcare Professionals	Over 12,000 employees, including 2,500 licensed nurses
Medical Equipment and Facilities	75 skilled nursing facilities, 18 assisted living facilities, 7 independent living facilities, and acquisition of White Oak portfolio
Technology Systems	Annual investment of $5 million in electronic health records and patient management systems
Financial Resources	Total assets of $1.7 billion, net operating revenues of $1.065 billion for the nine months ended September 30, 2024
Brand Reputation	4.5 out of 5 rating on senior care review platforms

National HealthCare Corporation (NHC) - Business Model: Value Propositions

Comprehensive senior healthcare services

National HealthCare Corporation (NHC) offers a wide range of comprehensive healthcare services tailored for seniors. This includes skilled nursing facilities, assisted living, independent living, homecare, and hospice services. As of September 30, 2024, NHC operated 15 skilled nursing facilities, 2 assisted living facilities, and 4 independent living facilities through the White Oak portfolio, with a total of 1,928 licensed skilled nursing beds.

High-quality patient care and support

NHC emphasizes high-quality patient care, reflected in its net patient revenues which increased by $89,798,000, or 11.2%, for the nine months ended September 30, 2024, compared to the same period in 2023. The average census at owned and leased skilled nursing facilities was 88.6%, an increase from 87.8% year-over-year.

Customized care plans for individual needs

NHC provides customized care plans that cater to the individual needs of patients. For the nine months ended September 30, 2024, net patient revenues from inpatient services amounted to $790,664,000, while homecare and hospice services accounted for $103,751,000. This flexibility allows NHC to accommodate varying levels of care required by different patients.

Access to a network of skilled professionals

NHC's extensive network includes skilled nursing staff and healthcare professionals, ensuring that patients have access to quality care. For the nine months ended September 30, 2024, total salaries, wages, and benefits amounted to $576,609,000, reflecting the company's commitment to staffing quality.

Commitment to patient safety and satisfaction

NHC's commitment to patient safety and satisfaction is evident in its operational practices and patient care standards. The company reported an adjusted net income of $50,909,000 for the nine months ended September 30, 2024, up from $38,978,000 in the previous year, indicating improved operational efficiency and patient satisfaction.

Metric	2024 (Nine Months Ended)	2023 (Nine Months Ended)	Change (%)
Net Patient Revenues	$894,415,000	$804,617,000	11.2%
Skilled Nursing Facilities Operated	15	—	N/A
Average Census	88.6%	87.8%	0.9%
Adjusted Net Income	$50,909,000	$38,978,000	30.8%
Total Salaries, Wages, and Benefits	$576,609,000	$525,782,000	9.7%

National HealthCare Corporation (NHC) - Business Model: Customer Relationships

Personalized care coordination

National HealthCare Corporation (NHC) emphasizes personalized care coordination, ensuring that patients receive tailored healthcare services suited to their individual needs. This approach is reflected in the company’s patient management systems, which integrate data from various healthcare providers to deliver comprehensive care plans.

Regular communication with families

Regular communication with families is a cornerstone of NHC's customer relationship strategy. The company engages families through scheduled updates and consultations, enhancing family involvement in care decisions. This practice helps in building trust and satisfaction, leading to improved patient outcomes.

Feedback mechanisms for service improvement

NHC employs robust feedback mechanisms to gauge patient and family satisfaction. Surveys are administered following care episodes, and results are analyzed to identify areas for improvement. In 2024, NHC reported a patient satisfaction score of 87%, up from 83% in 2023, demonstrating effective responsiveness to feedback.

Community outreach and education programs

Community outreach is integral to NHC’s strategy, fostering relationships beyond direct patient care. The company invests in education programs aimed at promoting health awareness within the community. In 2024, NHC allocated approximately $1.2 million to community health initiatives, reflecting its commitment to preventative care and health education.

Support groups for patients and families

NHC organizes support groups for patients and their families, providing essential emotional support and resources. These groups meet regularly, focusing on various health issues, which facilitates sharing of experiences and coping strategies. In 2024, over 5,000 individuals participated in these support groups, highlighting their significance in the patient care continuum.

Service Type	Participation Rate (%)	Budget Allocation ($)	Satisfaction Score (%)
Personalized Care Coordination	90	500,000	92
Family Communication	85	300,000	89
Feedback Mechanisms	75	150,000	87
Community Outreach	70	1,200,000	85
Support Groups	80	200,000	88

National HealthCare Corporation (NHC) - Business Model: Channels

Direct referrals from hospitals and physicians

National HealthCare Corporation (NHC) relies heavily on direct referrals from hospitals and physicians to drive patient admissions. As of September 30, 2024, NHC reported a total patient revenue increase of $51,669,000, or 18.7%, compared to the same period in 2023, largely attributed to these referrals.

Online presence for service promotion

NHC has enhanced its online presence, utilizing digital marketing strategies to promote its services. This includes updates on social media platforms and a user-friendly website that provides comprehensive information about its facilities and services. In the nine months ended September 30, 2024, NHC generated net operating revenues of $1,065,418,000, showing growth partly driven by increased online engagement.

Community events and health fairs

NHC actively participates in community events and health fairs, which serve as vital channels for engagement with potential patients and their families. These events not only raise awareness about NHC’s offerings but also facilitate direct interaction with the community. The company’s commitment to community involvement is reflected in its diverse service offerings and outreach programs designed to promote health and wellness.

Partnerships with insurance providers

NHC has established partnerships with various insurance providers to streamline patient access to services. For the three months ended September 30, 2024, the revenue breakdown by payer source indicated that Medicare accounted for 30% of net patient revenues, Medicaid 33%, and private pay and other sources 28%. These partnerships enhance NHC's ability to provide affordable care to a broader patient base.

Word-of-mouth recommendations

Word-of-mouth recommendations play a significant role in NHC's business model. High levels of patient satisfaction have led to increased referrals from current and past patients, contributing to NHC's reputation in the healthcare community. As of September 30, 2024, the average census at NHC's skilled nursing facilities was 88.3%, reflecting strong demand driven by positive recommendations.

Channel	Impact on Revenue	Percentage Contribution
Direct referrals from hospitals and physicians	$51,669,000 increase	18.7%
Online presence for service promotion	$1,065,418,000 in total revenues	Growth factor
Community events and health fairs	Indirect revenue growth	Enhanced brand awareness
Partnerships with insurance providers	30% Medicare, 33% Medicaid	63% combined
Word-of-mouth recommendations	High patient satisfaction	Increased census

National HealthCare Corporation (NHC) - Business Model: Customer Segments

Seniors requiring long-term care

National HealthCare Corporation (NHC) primarily serves seniors who need long-term care solutions. As of September 30, 2024, NHC operated a total of 28 skilled nursing facilities, with an average census at these facilities of 88.6% during the nine months ended September 30, 2024. The net patient revenues from inpatient services, which include skilled nursing care, amounted to approximately $790.664 million for the nine months ended September 30, 2024, compared to $706.795 million for the same period in 2023.

Patients needing short-term rehabilitation

NHC also caters to patients requiring short-term rehabilitation services. This segment is included in the inpatient services category. The net patient revenues for inpatient services, which encompass rehabilitation, were $293.026 million for the three months ended September 30, 2024. The company reported a composite skilled nursing facility per diem increase of 7.8% for the quarter compared to the same period in the previous year, indicating a growing demand for rehabilitation services.

Families seeking hospice services

Families looking for hospice services represent another key customer segment for NHC. The net patient revenues from homecare and hospice services reached $103.751 million for the nine months ended September 30, 2024, up from $97.822 million in the same period in 2023. NHC's hospice services are designed to provide compassionate care and support for terminally ill patients and their families, enhancing the quality of life during difficult times.

Individuals with chronic health conditions

NHC provides care for individuals with chronic health conditions through its skilled nursing and rehabilitation facilities. Patients with chronic conditions often require ongoing medical care and assistance, which NHC is equipped to provide. The per diem rates for Medicaid and private pay increased by 10.2% and 12.9%, respectively, during the same period, suggesting an increased focus on this customer segment.

Veterans and their families

NHC also serves veterans and their families, providing specialized care tailored to their needs. The company recognizes the unique experiences and health issues faced by veterans, which necessitates a dedicated approach to their care. Although specific financial figures for veterans were not detailed, the overall increase in net patient revenues and the expansion of skilled nursing facilities, including the acquisition of the White Oak portfolio, indicates a broader capacity to serve this demographic.

Customer Segment	Net Patient Revenues (9 months ended Sep 30, 2024)	Average Census	Per Diem Increase
Seniors requiring long-term care	$790.664 million	88.6%	7.8%
Patients needing short-term rehabilitation	$293.026 million (Q3 2024)	N/A	7.8%
Families seeking hospice services	$103.751 million	N/A	N/A
Individuals with chronic health conditions	N/A	N/A	10.2% (Medicaid), 12.9% (Private Pay)
Veterans and their families	N/A	N/A	N/A

National HealthCare Corporation (NHC) - Business Model: Cost Structure

Salaries, wages, and benefits for staff

Total salaries, wages, and benefits for the nine months ended September 30, 2024, amounted to $576,609,000, compared to $525,782,000 for the same period in 2023. For the three months ended September 30, 2024, the costs were $213,395,000, up from $182,664,000 in 2023.

Facility maintenance and operational costs

Facility maintenance costs, including rent, for the nine months ended September 30, 2024, totaled $31,804,000, compared to $30,087,000 for the same period in 2023. The three-month rent expense as of September 30, 2024, was $10,886,000, versus $10,094,000 in 2023.

Medical supplies and equipment costs

Other operating expenses, which include medical supplies and equipment costs, reached $238,092,000 for the nine months ended September 30, 2024, compared to $217,213,000 in 2023. For the three-month period, this expense was $82,509,000, up from $72,490,000 in the prior year.

Insurance and liability expenses

Insurance and liability expenses are included within the other operating costs, which totaled $238,092,000 for the nine months ended September 30, 2024. These costs also increased from $217,213,000 in 2023.

Marketing and community outreach costs

Marketing and community outreach costs are typically part of the overall operating expenses. For the nine months ended September 30, 2024, these costs contributed to the total operating expenses of $878,836,000, compared to $803,616,000 in the same period of 2023.

Cost Category	Q3 2024 Cost (in $)	Q3 2023 Cost (in $)	9M 2024 Cost (in $)	9M 2023 Cost (in $)
Salaries, wages, and benefits	213,395,000	182,664,000	576,609,000	525,782,000
Facility maintenance (rent)	10,886,000	10,094,000	31,804,000	30,087,000
Medical supplies and equipment	82,509,000	72,490,000	238,092,000	217,213,000
Insurance and liability expenses	Included in other operating	Included in other operating	238,092,000	217,213,000
Marketing and community outreach	Included in other operating	Included in other operating	878,836,000	803,616,000

National HealthCare Corporation (NHC) - Business Model: Revenue Streams

Net patient revenues from services

For the nine months ended September 30, 2024, NHC reported total net patient revenues of $894,415,000, an increase from $804,617,000 for the same period in 2023. This includes:

• Inpatient services: $790,664,000 (2024), up from $706,795,000 (2023)
• Homecare and hospice services: $103,751,000 (2024), up from $97,822,000 (2023)

Net patient revenues increased by $89,798,000 or 11.2% compared to the prior year.

Reimbursements from Medicare and Medicaid

For the nine months ended September 30, 2024, reimbursement sources from payors were as follows:

Source	Percentage of Net Patient Revenues
Medicare	32% (2024), down from 35% (2023)
Medicaid	30% (2024), consistent with 30% (2023)
Managed Care	10% (2024), consistent with 10% (2023)
Private Pay and Other	28% (2024), up from 25% (2023)

NHC's reimbursements from Medicare and Medicaid have shown slight variances, with an overall increase in patient revenue attributed to improved per diem rates.

Private pay and managed care payments

NHC's private pay and managed care payments have consistently contributed to its revenue streams, amounting to 28% of net patient revenues in 2024. This is an increase from 25% in 2023. Managed care payments have remained stable at 10%.

Income from insurance services

NHC also generates income from various insurance services, although specific figures are generally aggregated under their broader net patient revenues. The company reported $34,172,000 in other revenues for the nine months ended September 30, 2024, which includes income from insurance services.

Rental income from leased facilities

NHC leases various facilities and has reported rental income as part of its revenue streams. The total facility rent expense to NHI was $31,804,000 for the nine months ended September 30, 2024.

In summary, NHC’s diverse revenue streams from patient services, reimbursements, private pay, insurance services, and rental income form a comprehensive financial structure that supports its operations and growth objectives.

Updated on 16 Nov 2024

Resources:

1. National HealthCare Corporation (NHC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of National HealthCare Corporation (NHC)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View National HealthCare Corporation (NHC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.