Team 6

Executive Summary
Situation
The University of Colorado Hospital (UCH) has enjoyed a mutually beneficial affiliation with
National Jewish Health (NJH) for 20 years. However, this affiliation agreement dissolved on
January1, 2015. The lost relationship will have financial, clinical, and academic impacts, but
also presents a unique opportunity for UCH to reassess its strategic plan for respiratory services.
Strategic Objectives
We developed three strategic objectives after a comprehensive analysis of the problem, the
associated impacts, and the opportunities:
Financial: Remain sustainable in the long-run
Clinical: Grow national reputation beyond pulmonary medicine
Academic: Maintain national distinction and grow research capability
Analysis
Based on these objectives, we formed three potential proposals for the way ahead.
1. Proposal #1: Take No Further Action
2. Proposal #2: Acquire a Local Pulmonary Practice
3. Proposal #3: Build the Respiratory Institute of the Rockies
The following table summarizes our qualitative and quantitative analyses of the three proposals:

Financial Objective
Clinical Objective
Academic Objective
Net Present Value
Internal Rate of Return
Payback Period
Area of Impact

Proposal #1

Proposal #2

Proposal #3

$322.9 million
--UCH only

$328.3 million
29%
2.55 years
Colorado region

$326.5 million
27%
3.20 years
National

Recommendation
We recommend building the Respiratory Institute of the Rockies in the former emergency
department. This is the only option that strategically places UCH to be competitive financially,
clinically, and academically in both the regional and national markets. Also, the unique design of
this space gives UCH the opportunity to build an innovative and physically identifiable center for
multidisciplinary and collaborative care. The financial analysis and phasing timeline are
provided in the attached appendices.