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Establishing a New Nursing Program at Appalachian State University: Benefits and Cost Analysis

Appalachian State University is launching a new nursing program under the College of Fine & Applied Arts, including plans for a dedicated building on donated land. This initiative aims to enhance nursing education, increase enrollment, and improve healthcare for local communities. The program could lead to higher nurse supply and prestige for the university. A thorough cost-benefit analysis shows that the net present value of the project exceeds costs over time. This building will serve as a significant asset in addressing nursing shortages in Western North Carolina.

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Establishing a New Nursing Program at Appalachian State University: Benefits and Cost Analysis

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  1. Creation of a Nursing Program Sarah Hink Matt Downs For Dr. Wanda Stutts 12/9/08

  2. Alternative projects • Appalachian 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

  3. Standing • 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

  4. Impacts • COST • Building • Equipment and supplies • Staff salary • Fees • BENEFITS • Higher enrollment • Increases supply of nurses • Prestige for the University

  5. Quantitative Impacts • Cost Impacts • Building dedicated to the nursing program • 8 Beds • 6 Exam Tables • Annual Supplies • Salaries for 30 faculty members • Equipment

  6. Quantitative Impacts

  7. Survey Results

  8. Survey Results

  9. Survey Results

  10. 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?

  11. Survey Results

  12. 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?

  13. Monetize all market and non-market impacts

  14. Monetize all market and non-market impacts • Tuition will transfer from nursing students to the university

  15. Present Values of Benefits & Costs • Benefit 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

  16. Net Present Value of each Alternative • Best Case Benefit/Best Case Cost • NPV = $92,542,928 • Best Case Benefit/Worst Case Cost • NPV = $51,036,672 • Worst Case Benefit/Best Case Cost • NPV = $12,144,347 • Worst Case Benefit/Worst Case Cost • NPV = -$29,361,909

  17. WTP in donations Number of donations Capital cost Discount rate Number of graduates Perform sensitivity analysis over uncertain issues

  18. Issues unaccounted for • Benefits • Improved health in the Southeast • State grants • Costs • Electricity and other utilities

  19. Make a recommendation • With 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.

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