Tallahassee Clinic projected the following budget informationfor 2018:
Total FFS Visit Volume
90,000 visits
Payer Mix:
Blue Cross
40%
Celtic Insurance Company
60%
Reimbursement Rates:
Blue Cross
$25 per visit
Celtic Insurance Company
$20 per visit
Variable Costs â Resource Inputs:
Labor
48,000 total hours
Supplies
100,000 total units
Variable Costs â Input Prices:
Labor
$25 per hour
Supplies
$1.50 per unit
Fixed Costs (overhead, plant, and equipment)
$500,000
Construct Tallahassee Clinicâs static operating budget for 2018.(See Exhibit 8.3, page 283. Note that there are four componentsthat need to be included: Volume Assumptions, Revenue Assumptions,Cost Assumptions, and the Pro Forma Profit and Loss or P&Lprojected Statement.)
Tallahassee Clinic projected the following budget informationfor 2018:
Total FFS Visit Volume | 90,000 visits |
Payer Mix: | |
Blue Cross | 40% |
Celtic Insurance Company | 60% |
Reimbursement Rates: | |
Blue Cross | $25 per visit |
Celtic Insurance Company | $20 per visit |
Variable Costs â Resource Inputs: | |
Labor | 48,000 total hours |
Supplies | 100,000 total units |
Variable Costs â Input Prices: | |
Labor | $25 per hour |
Supplies | $1.50 per unit |
Fixed Costs (overhead, plant, and equipment) | $500,000 |
Construct Tallahassee Clinicâs static operating budget for 2018.(See Exhibit 8.3, page 283. Note that there are four componentsthat need to be included: Volume Assumptions, Revenue Assumptions,Cost Assumptions, and the Pro Forma Profit and Loss or P&Lprojected Statement.)
Related questions
Problem 1
Tallahassee Clinic projected the following budget informationfor 2018:
Total FFS Visit Volume | 90,000 visits |
Payer Mix: | |
Blue Cross | 40% |
Celtic Insurance Company | 60% |
Reimbursement Rates: | |
Blue Cross | $25 per visit |
Celtic Insurance Company | $20 per visit |
Variable Costs â Resource Inputs: | |
Labor | 48,000 total hours |
Supplies | 100,000 total units |
Variable Costs â Input Prices: | |
Labor | $25 per hour |
Supplies | $1.50 per unit |
Fixed Costs (overhead, plant, and equipment) | $500,000 |
Construct Tallahassee Clinicâs static operating budget for 2018.(See Exhibit 8.3, page 283. Note that there are four componentsthat need to be included: Volume Assumptions, Revenue Assumptions,Cost Assumptions, and the Pro Forma Profit and Loss or P&Lprojected Statement.)
EXHIBIT 8.3 PAGE 283:
- Volume assumptions:
- FFS 36,000 visits
- Capitatedlives 30,000 members
Number ofmember-months 360,000
Expected utilization per
Member-month 0.15
Number ofvisits 54,000 visits
- Total expectedvisits 90,000 visits
- Revenue Assumptions:
- FFS $25 per visit
X 36,000 visits
$900,000
- Capitatedlives 3PMPM
X 360,000 actual member months
$1,080,000
- Total expectedrevenues $1,980,000
- Cost Assumptions:
- Variable costs:
Labor $1,200,000 (48,000 hrs at $25/hr)
Supplies 150,000 (100,000 units at $1.50/unit)
Total variablecosts $1,350,000
Variable cost pervisit $ 15 ((1,350,000/90,000)
- Fixed costs:
Overhead, plant, &equip $500,000
- Total expectedcosts $1,850,000
- Pro Forma Profit and Loss (P&L) Statement:
Revenues:
FFS $900,000
Capitated 1,080,000
Total $1,980,000
Costs:
Variable:
FFS $540,000
Capitated 810,000
Total $1,350,000
ContributionMargin $630,000
FixedCosts 500,000
Projectedprofit $130,000
