Creation of a Nursing Creation of a Nursing ProgramProgramSarah HinkMatt DownsFor Dr. Wanda Stutts12/9/08

Alternative projectsAlternative projectsAppalachian State University has

started a new nursing program under the College of Fine & Applied Arts

The nursing program is currently working to construct a new building on donated land

If this was not to happen, the nursing program could remain in the same building it currently shares with other programs

StandingStanding

Beneficiaries would include:◦Appalachian State University◦Future nursing students ◦Local and regional hospitals◦Local and regional citizens (i.e.

improved healthcare)Cost would affect:

◦Appalachian State University

ImpactsImpacts

COST◦Building ◦Equipment and supplies◦Staff salary◦Fees

BENEFITS ◦Higher enrollment ◦Increases supply of nurses◦Prestige for the University

Quantitative ImpactsQuantitative Impacts

Cost Impacts◦Building dedicated to the nursing

program◦8 Beds◦6 Exam Tables◦Annual Supplies◦Salaries for 30 faculty members◦Equipment

Quantitative ImpactsQuantitative Impacts

Benefits

Number of Graduates (low) Per Year

36

Number of Graduates (high) Per Year

108

Number of Living Alumni today 90,000

Estimated number of living alumni in 30 years

162,500

Estimated cumulative # of nursing graduates over 30 years

2,916

Average Nursing Salary $65,000

Survey Results

Survey Results

Survey Results

Survey Results Having a nursing school will benefit Western North Carolina by

having a larger supply of nurses and could help maintain and improve the level of health in North Carolina. Knowing this, how much would you be willing to pay more in tuition or fees, even if you are not a nursing student, if there was a building designated for the nursing program?

Survey Results

Survey Results As an alumnus, how much more would you be willing

to donate to Appalachian if there was a building donated to the nursing program?

Monetize all market and non-Monetize all market and non-market impactsmarket impactsOne-time Costs $

Building 50,000,000

Beds 28,000

Tables 3,600

Equipment 200,000

Total Annual Costs (Over 30 years)

$

Supplies 277,500

Faculty salaries 48,150,000

Monetize all market and non-Monetize all market and non-market impactsmarket impacts

Tuition will transfer from nursing students to the university

Benefits $

Alumni Donations for 2008 3,411,000

Total Alumni Donations over 30 years (2008-2037)

143,546,250

Nursing Alumni Donations over 30 years (Cumulative)

1,564,967

Nursing Salaries over 30 years (Cumulative)

189,540,000

Present Values of Benefits & Present Values of Benefits & CostsCostsBenefit Discounting

◦Best Case (2% Discount Rate) $105,503,489

◦Worst Case (7% Discount Rate) $25,104,908

Cost Discounting◦Best Case (7% Discount Rate)

$12,960,561

◦Worst Case (2% Discount Rate) $54,466,817

Net Present Value of each Net Present Value of each AlternativeAlternativeBest Case Benefit/Best Case Cost

◦NPV = $92,542,928Best Case Benefit/Worst Case Cost

◦NPV = $51,036,672Worst Case Benefit/Best Case Cost

◦NPV = $12,144,347Worst Case Benefit/Worst Case Cost

◦NPV = -$29,361,909

Perform sensitivity analysis Perform sensitivity analysis over uncertain issuesover uncertain issuesWTP in donationsNumber of donationsCapital costDiscount rateNumber of graduates

Issues unaccounted forIssues unaccounted forBenefits

◦Improved health in the Southeast◦State grants

Costs◦Electricity and other utilities

Make a recommendationMake a recommendationWith the shortage of nursing jobs available in

the southeast, the Appalachian Nursing program would greatly benefit the supply of nurses over time.

With the positive impact of more nurses and improved healthcare in the southeast, constructing a building would be in the best interest of Appalachian to attract students, our future nurses.

Assuming the nursing graduates donate back to the nursing program at the same average rate as the rest of the programs at Appalachian, benefits would exceed costs over time.