Scenario #2: A large regional hospital has a vacant wing that has 40 beds. This unit has been closed because the hospital was effective in establishing a hospitalist program that helped reduce length of stay and increased timely discharges. Also, the hospital built a newer patient care tower that opened in the past year. The hospital received a Certificate of Need for a 40 bed, separately licensed Long Term Acute Care Hospital (LTACH). This sub-acute unit must have 24/7 physician coverage to handle Page 3 admissions and daily visits. The LTACH will contract with a local hospitalist group for daily coverage of at least 4 hours per day during the first six months. Average length of stay is projected to be 26 days per admission (covered by Medicare Part A and insurances). The hospital is planning a contract with the group and wants to present a pro-forma. The group wants a monthly call coverage stipend of $3000 per month plus the ability to bill for professional services. The hospital agrees that during start up, they will pay a subsidy between the expense of the hourly rate versus what the physician group actually collected. Coverage would require 120 hours of physician time per month (4 hours/day during start up; hours expand based on census) or approximately $150/hour. Complete the proforma and calculate the expense and revenue. Revenue average $100/encounter. You have to add the estimated revenue (do this by taking Average daily census and multiplying this by estimated revenue of $100 per physician encounter). Then complete the first yellow line in the spreadsheet. The budget shows a projected growth. Due to nature of the admissions and discharges, it is assumed that the ADC is 35 at month 12 for planning purposes. It is unlikely to have a full census 100 percent of the time. Your paper should discuss the scenario, why hospitalist coverage is needed, and how this would comply with Stark laws regarding physician services. You also need to justify a rationale for a call agreement as well as subsidy. Include the proforma in your final paper. You can include charts made from the data to highlight key points. Complete the budget from the Excel Spreadsheet.