Current State Financial Information: Currently, the physicians' offices as a whole at SHS make approximately a 5.5% profit margin net billing per year, which is reinvested into physician incentives and necessary capital upgrades?equipment, facilitates, and information systems. Historically, this 4 capital margin has been approximately $5,000,000 per year. However, given concerns over losing ambulatory volumes to competitors this year, the CFO is projecting this capital margin to be $4,500,000. Of this margin, $500,000 is allocated toward facilities and equipment upgrades for the physician practices. Recognizing the competitive concerns and need to meet CMS MU and billing regulations through a comprehensive health information management strategy, the SHS board of directors has allocated a one-time $4,000,000 capital expenditure for the ambulatory electronic medical record investment for this fiscal year. It is projected that this capital expenditure will be spent over a one-to three-year period. Currently,the total annual operating budget to run the disparate ambulatory information system platforms in the SHS physician offices is $700,000, including the detailed breakdown of costs below. There is currently no capital technology expenditure for SHS physician practices.

• Software maintenance/support: $300,000
• Hardware maintenance/support: $200,000
• Support/post-production salaries: $150,000
• Other (miscellaneous training and so on): $50,000

A B C D E F G H I AWNH ESTIMATED COST OF PROJECT Scope of Implementation: Software Licensing Terms: FY '01 FY '02 FY '03 FY '04 FY '05 Totals 5 Capital 6 Consulting Services Vendor or Third Party Implementation Salaries 8 Database Software 9 Hardware 10 Network 11 Licensed Software 12 Capital Totals $0 $0 $0 $O 13 Operating 14 Software Maintenance/Support 15 Hardware Maintenance/Support 16 Physician Salary Support 17 Support/Post-Production Salaries 18 Travel/Training 19 Other 20 Operating Totals $0 $0 $0 $0 $0 21 Grand Totals (Capital and Operating) $0 SO $0 $0 $0 $0 22 23 24 25 26 27 28 29 30 31 27