To deliver health care services, an ACO needs to create a competent workforce that can provide health care to the patients that are in the ACO. Some integrated ACO entities already have employed physicians and mid-level providers that receive salaries from the organization, whereas other non-integrated ACO entities need to invest in external relationships with independent physicians and other providers. Since ACOs do not have managerial control over non-employed providers, additional controls and incentives may be necessary to ensure that efficiency is maximized. ACOs also need to consider the number and mix of specialists (e.g., family practice vs internal medicine) and mid-level providers (e.g., physician assistants and nurse practitioners) in delivering primary care services that can promote value. Maximizing value requires appropriate workforce decisions on supply and incentives to encourage providers to minimize costs. For this Assignment, examine the Week 4 Assignment document and consider the efficiency in the supply of health services.

To prepare for this Assignment:

Review the scenario and Week 4 Assignment document provided to you by the Instructor. Based on the financial data, conduct a financial projection (revenues, expenses, and profit) that analyzes the efficiency of the supply of health services.

The Assignment:

In a 2- to 3-page Word document that includes tables and/or calculations, make recommendations on the following: 1) number of physicians and nurse practitioners needed; 2) reimbursement method: salary or fee-for-service; 3) recommendations for financial incentives to address the challenges of supplier-induced demand and how to ensure efficiency. Interpret the net profit from the ACO contract based on your recommendations. Explain the rationale behind your recommendations, including the impact made by your financial calculations.

I have attached my chart. I am not certain if the information is correct. My professor said I am on the right track, but my numbers are not correct for the expenses and I am clueless as to solve my issue.

Healthcare Financial Management and Economics Week 4 Assignment Supply of Primary Care Workforce 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 as follows: 50% revenue to the insurer and 50% revenue to the hospital. The ACO patient population will require an average of six 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) that analyzes the efficiency of the supply of health services. The Assignment: In a 2- to 3-page Word document that includes tables and/or calculations, make recommendations on the following: 1) number of physicians and nurse practitioners needed; 2) reimbursement method: salary or fee-for-service; 3) recommendations for financial incentives to address the challenges of supplier-induced demand and how to ensure efficiency. Interpret the net profit from the ACO contract based on your recommendations. Explain the rationale behind your recommendations, including the impact made by your financial calculations. Financial Data ACO revenue: Number of ACO patients Potential savings: Number of avoidable hospitalizations per patient Total avoidable hospitalizations per year Cost per avoidable hospitalization Total cost of avoidable hospitalizations Demand for healthcare/utilization: Number of office visits per patient Total office visits per year Supply of workforce/expense: Employed providers (salary) 2015 Laureate Education, Inc. 10,000 0.1 1,000 $10,000 $10,000,000 6 60,000 Page 1 of 2 Physician salary per year Nurse practitioner salary per year Contracted providers (fee-for-service) Physician fee per visit Nurse practitioner fee per visit Productivity: Physician visits per year Nurse practitioner visits per year Financial incentives: Salary bonus to ensure efficiency Bonus fee per visit to ensure efficiency 2015 Laureate Education, Inc. $200,000 $100,000 $100 $50 3,000 2,000 10% $1 Page 2 of 2 Week 4 Assignment Rubric CATEGORY Recommendations for 1) number of physicians and nurse practitioners; 2) reimbursement method: salary or fee-for-service; 3) recommendations for financial incentives to address challenges of supplier induced demand and ensure efficiency EXCELLENT - above expectations The recommendations are accurate and show depth and breadth in critical thinking when addressing the key points related to economic efficiency. GOOD - met expectations The recommendations are accurate and fully address the key points related to economic efficiency. FAIR - below expectations The recommendations are partially accurate or lack depth, breadth, or clarity in addressing the key points related to economic efficiency. POOR - significantly below expectations or missing The recommendations are inaccurate (zero points) or poorly address key points related to economic efficiency. SCORE (8 points) (9-10 points) (0-6 points) (7 points) (10 points) Interpretation of the net profit from the ACO contract based on recommendations (8 points) The interpretation shows critical thinking, considers divergent and competing opinions, and demonstrates creative problem solving in its analysis of the net profit from the ACO contract based on recommendations. The interpretation fully addresses the net profit from the ACO contract based on recommendations. The interpretation lacks depth or clarity in addressing the net profit from the ACO contract based on recommendations. The interpretation does not address (zero points) or poorly addresses net profit from the ACO contract based on recommendations. (6 points) (7 points) (0-5 points) (8 points) Rationale, including how the financial calculations impacted your recommendations (7 points) The rationale shows critical thinking, considers divergent and competing opinions, and demonstrates creative problem solving in its analysis of how the financial calculations impacted the recommendations. The rationale fully addresses how the financial calculations impacted the recommendations. The rationale lacks depth or clarity in addressing how the financial calculations impacted the recommendations. The rationale does not address (zero points) or poorly addresses how the financial calculations impacted the recommendations. (5 points) (0-4 points) (6 points) (7 points) Writing (5 points possible) The paper is well organized, uses scholarly tone, contains original writing and proper paraphrasing, follows APA style, contains very few or no writing and/or spelling errors, and is fully consistent with graduate-level writing style. The paper is mostly consistent with graduate-level writing style and may have some spelling, APA, and writing errors. The paper is somewhat consistent with graduate-level writing style and may have some spelling, APA, and writing errors. The paper is well below graduate-level writing style expectations for organization, scholarly tone, APA style, and writing, or shows heavy reliance on quoting. (5 points) (4 points) (3 points) (0-2 points) Instructor comments: Total Score (30 possible points): 2015 Laureate Education, Inc. Page points 1 of 2 Week 4 Assignment Rubric 2015 Laureate Education, Inc. Page 2 of 2 Note: Students are to complete this template based on Assignment information and to insert it into a MS Word Document for submission. Expenses Salary FFS Bonus Salary Number Visits Number of physicians 20 3,000 $200,000 $300,000 $20,000 Number of nurse practitioners 30 2,000 $100,000 $100,000 $10,000 Totals 50 5,000 Salary Revenues $5,000,000 Expenses $330,000 Profit $4,670,000 $300,000 FFS $5,000,000 $405,000 $4,595,000 $400,000 $30,000 rt it into a MS Word Bonus FFS $3,000 $2,000 $5,000