ToR: Development of a Business Development Plan for a Tiered Patient Fee System at St. Joseph’s Eye Hospital Mgbirichi, Imo State, Nigeria – ToR: Development of a Business Development Plan for a Tiered Patient Fee System

Background

Nigeria bears a significant burden of avoidable blindness and visual impairment, particularly due to cataracts and uncorrected refractive errors. Access to quality eye care remains constrained by poverty, limited health insurance coverage, and high out-of-pocket expenditures. As a result, many patients delay or forego treatment, leading to avoidable vision loss and reduced quality of life.

St. Joseph's Eye Hospital Mgbirichi is committed to ensuring that all patients, regardless of their socioeconomic status, can access quality eye care services. Currently, the hospital's patient fee system does not sufficiently guarantee affordability for vulnerable and low-income populations while ensuring long-term financial sustainability.

To address this challenge, the hospital seeks to develop a robust, transparent, accountable, and financially sustainable tiered patient fee system based on a cross-subsidization approach. Under this model, higher-paying patient groups, insurance reimbursements, and other revenue streams will partially subsidize care for patients with limited ability to pay.

An external consultant will be engaged to work closely with the hospital management and relevant stakeholders to develop a comprehensive Business Development Plan. The external consultant will assess the existing fee structure, identify gaps and weaknesses, design a differentiated pricing framework, develop a practical means-testing mechanism, and prepare a detailed implementation and scale-up roadmap.

The external consultant’s engagement will be limited to the development of the Business Development Plan and the accompanying implementation roadmap, including recommendations, tools, and guidance to support execution. Responsibility for the actual implementation, roll-out, and management of the proposed pricing and means-testing systems will remain with the hospital and relevant stakeholders and will not form part of this consultancy assignment.

Purpose of the Assignment

The purpose of this consultancy is to develop a comprehensive Business Development Plan for a Tiered Patient Fee System that will:

Improve equitable access to eye care services for poor and vulnerable populations.
Enhance financial sustainability of St. Joseph's Eye Hospital Mgbirichi.
Establish a transparent and accountable cross-subsidization mechanism.
Strengthen revenue generation while maintaining the hospital's social mission.
Support evidence-based decision-making and long-term growth.

Objectives

General Objective

To design a financially sustainable, socially equitable, and operationally feasible patient fee system for St. Joseph's Eye Hospital Mgbirichi.

Specific Objectives

The external consultant shall:

Assess the current patient fee structure and financing mechanisms.
Develop a differentiated (tiered) pricing system based on patients' ability and willingness to pay.
Design a transparent cross-subsidization model to support indigent patients.
Develop a practical patient classification and means-testing system.
Analyze service costs, revenue streams, and sustainability scenarios.
Propose governance, operational, and accountability frameworks.
Identify weaknesses in the existing fee system and recommend improvements.
Develop a phased implementation and business growth strategy.
Produce financial projections and sensitivity analyses for a period of 3-5 years.

Scope of Work

The external consultant shall undertake the following tasks:

Inception Phase

Review relevant project documentation, hospital records, and financial reports.
Hold inception meetings with hospital management and key stakeholders.
Develop an inception report outlining methodology, work plan, stakeholder engagement strategy, and data collection tools.

Situational Assessment and Diagnostic Review

Review the existing patient fee system, pricing policies, and revenue model.
Analyze hospital service utilization trends, patient demographics, and payer mix.
Assess current financial performance, cost recovery levels, and operational efficiency.
Identify strengths, weaknesses, risks, and opportunities within the current system.

Market and Socioeconomic Assessment

Conduct patient segmentation based on socioeconomic status.
Assess willingness and ability to pay among different patient groups.
Examine household expenditure patterns and affordability constraints.
Review potential demand for premium and value-added services.
Benchmark comparable eye hospitals and social enterprise healthcare models, including successful cross-subsidization approaches.

Costing and Financial Analysis

Determine unit costs of key services, including consultations, diagnostics, surgeries, spectacles, medications, and outreach services.
Analyze fixed, variable, and overhead costs.
Assess current and projected revenue streams.
Identify cost-recovery thresholds and financial sustainability indicators.
Conduct break-even and sensitivity analyses.

Design of the Tiered Patient Fee System

Develop an evidence-based pricing framework by:

Defining patient categories (e.g., indigent, low-income, middle-income, insured, premium).
Establishing differentiated pricing levels.
Identifying services eligible for subsidization.
Ensuring transparency, fairness, simplicity, and operational practicality.
Aligning the fee structure with the hospital's charitable mission and sustainability objectives.

Design of the Cross-Subsidization Model

The external consultant will:

Develop a detailed financial model demonstrating revenue generation and subsidy allocation.
Quantify the level of cross-subsidization required to support vulnerable patients.
Analyze different patient-mix scenarios, including: 

Out-of-pocket patients
NHIA-covered patients
HMO-covered patients
Corporate clients
Private-paying premium patients

Establish sustainability thresholds and financial safeguards.

Means Testing and Patient Eligibility System

The external consultant shall design a practical and dignified patient assessment system that:

Identifies patients eligible for subsidized services.
Minimizes fraud and abuse.
Uses objective and culturally appropriate indicators.
Protects patient confidentiality and dignity.
Includes verification tools and procedures.

Business Model and Sustainability Strategy

The external consultant will develop a comprehensive non-profit business model that:

Defines value propositions and service offerings.
Identifies growth opportunities.
Strengthens revenue diversification.
Improves cost efficiency.
Supports long-term institutional sustainability.
Aligns with the hospital's strategic goals.

Operational Framework

The external consultant shall:

Map patient flow from registration through service delivery and billing.
Define staffing requirements and responsibilities.
Recommend workflow adjustments.
Propose digital and administrative systems needed for implementation.
Develop operational standard operating procedures (SOPs).

Governance, Accountability and Monitoring Framework

The external consultant shall:

Develop governance structures for oversight of the fee system.
Recommend accountability and transparency mechanisms.
Develop monitoring indicators and reporting tools.
Define institutional roles and responsibilities.
Recommend audit and compliance measures.

Risk Assessment and Mitigation

Identify and assess:

Financial risks.
Operational risks.
Reputational risks.
Ethical and social risks.

The external consultant shall propose practical mitigation measures for each identified risk.

Implementation and Scale-Up Plan

Develop an implementation roadmap that includes:

Pilot phase design.
Change management strategy.
Capacity building requirements.
Resource requirements.
Timeline and milestones.
Monitoring and evaluation plan.

Deliverables

The external consultant shall deliver:

Deliverable 1: Inception Report

Including:

Methodology
Detailed work plan
Stakeholder engagement plan
Data collection tools

Deliverable 2: Diagnostic Assessment Report

Including:

Situational analysis
Market assessment
Patient segmentation findings
Existing system gap analysis

Deliverable 3: Draft Business Development Plan

The draft plan shall include:

Situational analysis findings
Tiered patient fee structure
Means-testing framework
Cross-subsidization model
Financial model and projections (3-5 years)
Operational framework
Governance structure
Risk management plan
Implementation roadmap

Deliverable 4: Validation Workshop

Presentation of findings to management and stakeholders.
Facilitation of stakeholder review and feedback sessions.

Deliverable 5: Final Business Development Plan

Incorporating all agreed feedback and recommendations.

Methodology

The external consultant is expected to apply a mixed-methods approach including:

Desk review of institutional documents.
Financial records review.
Key informant interviews.
Focus group discussions where appropriate.
Patient surveys.
Costing studies.
Financial modeling.
Benchmarking against best practices and social enterprise healthcare models.
Stakeholder validation workshops.

Duration of Assignment

The assignment shall be completed within 14-18 weeks.    

Phase
Duration

Inception
1-3 weeks

Data Collection & Analysis
3-4 weeks

Business Model & Financial Design
2-5 weeks

Validation & Reporting
2-6 weeks

Reporting and Supervision

The external consultant will report to:

Hospital Management Team
DMMM’s Project Team
CBM’s Programme Team

The external consultant shall submit bi-weekly progress updates throughout the assignment.

Required Qualifications

External consultant/Firm

Advanced qualifications in Health Economics, Health Financing, Public Health, Business Administration, Finance, or related disciplines.
Minimum 7 years of relevant professional experience.
Demonstrated expertise in healthcare financing and financial sustainability planning.
Strong financial modeling and business development experience.
Proven experience designing tiered pricing and cross-subsidization systems.
Experience working in low- and middle-income country health systems.
Excellent analytical, facilitation, and report-writing skills.

Desirable Qualifications

Experience in eye health and hospital management.
Experience supporting faith-based or non-profit health institutions.
Familiarity with the Aravind Eye Care model and similar social enterprise approaches.
Knowledge of Nigeria's health financing landscape, NHIA, and HMO systems.

Key Performance Indicators (KPIs)

The assignment will be assessed based on:

Quality and comprehensiveness of the Business Development Plan.
Technical soundness of the tiered fee system.
Financial viability of the proposed model.
Practicality of the means-testing system.
Stakeholder satisfaction with the process and outputs.
Feasibility and sustainability of implementation recommendations.
Timely submission of deliverables.

Ethical Considerations

The external consultant shall:

Maintain confidentiality of all patient and institutional data.
Obtain informed consent during interviews and surveys.
Ensure non-discrimination and fairness in all recommendations.
Protect the dignity of vulnerable patient groups.
Comply with applicable ethical and data protection requirements.

Budget and Payment Schedule

The consultancy budget is inclusive of professional fees, data collection expenses, stakeholder validation workshop costs, accommodation, meals, local transportation, and domestic travel where applicable. All consultancy-related costs must be accommodated within the approved project budget, and the total expenditure must not exceed the overall approved budget allocation.

Suggested payment schedule:

Milestone
Percentage

Approval of Inception Report
20%

Submission of Draft Business Development Plan
40%

Approval of Final Business Development Plan
40%

Proposal Submission Requirements

Interested consultants or consulting firms are invited to submit an Expression of Interest (EOI) comprising:

A Technical Proposal demonstrating an understanding of the Terms of Reference (ToR), including the proposed approach, methodology, and work plan for the assignment.
A Financial Proposal with a detailed budget covering all costs associated with the assignment, including expenses related to conducting a disability-inclusive and participatory process, as well as applicable taxes in accordance with local regulations.
A company profile (where applicable), highlighting relevant experience and expertise.
Evidence of successfully completed similar assignments, including at least three client references.
CVs of the proposed key personnel/team members.
Detailed work plan and timeline for the entire assignment.

DMMM/CBM reserve the right to terminate the contract if the selected consultant(s) are unavailable at the commencement of, or at any stage during, the assignment.