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A local clinic created the following static budget table for the year 2015. Complete the table...

A local clinic created the following static budget table for the year 2015. Complete the table below by filling the blanks and creating a profit & loss statement under section IV

Section I-Volume Assumptions

A-FFS (fee for service) 50,000 vists

B-Capitated lives 30,000 members

Number of member-months ?

Expected utilization per member-month 0.25

Number of visits ?

Total Expected Visits ?

Section II- Revenue Assumptions

A-FFS $30/visit (30x50,000 expected visits)=$1,500,000

B-Capitated lives $3 PMPM (3x 360,000 member-months)=$1,080,000

Total Expected Revenues ?

Section III-Cost Assumptions

A-Variable Costs:

Labor (60,000 hrs at $25/hr)=$1,500,000

Supplies (200,000 units at $1.5unit/hr)=$300,000

Total variable Cost $1,800,000

Variable cost per visit (1,800,000/140,000)=$12.8571429

B-Fixed Costs $500,000

C-Total expected costs ?

Section IV-Profit & Loss statement-create

Expert Solution

Section I-Volume Assumptions;
A. FFS (Fee for service)	50000 visits
B. Capitated lives	30000 members
Number of member-months	360000
Expected utilization per member-month	0.25
Number of visits (360000 * 0.25)	90000 visits
C. Total Expected Visits (50000 + 90000)	140000 visits

Section II- Revenue Assumptions;
A. FFS ($30 * 50000)	$1500000
B. Capitated lives ($3 * 360000)	$1080000
C. Total Expected Revenues ($1500000 + $1080000)	$2580000

Section III-Cost Assumptions;
A-Variable Costs:
Labor (60000 hours * $25)	$1500000
Supplies (200000 units * $1.5)	$300000
Total variable costs	$1800000
Variable cost per unit ($1800000 / 140000 visits)	$12.8571429
Fixed costs	$500000
C-Total expected costs ($1800000 + $500000)	$2300000

Section IV-Profit & Loss statement
Revenues;
FFS	$1500000
Capitated	$1080000
Total	$2580000
Costs;
Variable:
FFS ($1800000 * 50000 / 140000)	$642857.14
Capitated ($1800000 * 90000 / 140000)	$1157142.86
Total	($1800000)
Contribution margin	$780000
Fixed costs	($500000)
Projected profit	$280000

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