Hello I am having trouble figuring this weeks assignment out.

I know that there will be 20 physicians and 30 nurse practitioners. But I can figure out the Fee for service portion.

Scenario: Your hospital has an opportunity to participate with an Accountable Care Organization (ACO) contract with 10,000 ACO patients. The ACO patient population expects about 1,000 avoidable hospitalizations per year with a potential savings of $10 million, which will be shared 50% revenue to the insurer and 50% revenue to the hospital. The ACO patient population will require an average of 6 office visits per year, and 60,000 total office visits will need to be supplied by your primary care workforce.

To prepare for this Assignment: Based on the scenario and financial data provided by the course instructor, conduct a financial projection (revenues, expenses, and profit) which analyzes the efficiency in the supply of health services.

Financial Data

ACO revenue:

Number of ACO patients 10,000

Potential savings:

Number of avoidable hospitalizations per patient 0.1

Total avoidable hospitalizations per year 1,000

Cost per avoidable hospitalization $10,000

Total cost of avoidable hospitalizations $10,000,000

Demand for healthcare/utilization:

Number of office visits per patient 6

Total office visits per year 60,000

Supply of workforce/expense:

Employed providers (salary)

Physician salary per year $200,000

Nurse practitioner salary per year $100,000

Contracted providers (fee-for-service)

Physician fee per visit $100

Nurse practitioner fee per visit $50

Productivity:

Physician visits per year 3,000

Nurse practitioner visits per year 2,000

Financial incentives:

Salary bonus to ensure efficiency 10%

Bonus fee per visit to ensure efficiency $1