What approach would you give to the Ambulatory Surgery for Middleboro? We have achieved our targeted utilization and financial projections for ambulatory surgery in Jasper. Our surgery center in Jasper has hit capacity and the surgeons would like us to build out space in our Middleboro office and recruit additional surgeons to support both. Assume the following information regarding costs of the expansion: Annual fixed costs $500,000 Average variable per case $1150 Annual procedures $3,000 Average charge per procedure $2350 Payer % of Visits Revenue/Charge Ratio Medicare 35% 75% Medicaid 15% 50% Managed Care 15% 85% Swift 10% 88% Other Commercial 5% 0% We estimate that this unit, using a standard relative value unit (RVU) system used in hospitals, will generate 1.1 surgical procedures per case. What should the type of cases be at each locations. Further, if we need to recruit additional surgeons, what specialties do you recommend and what are the recruitment costs associated with this? Lastly, the state has also announced that in 18 months, all Medicaid rates paid to physicians and hospitals may be reduced by an additional 10 percent. Today, Medicaid pays Medical Associates on average 60 percent of gross billed charges. Further reductions in reimbursement may require management action. Options include no longer accepting Medicaid, no longer accepting Medicaid for ambulatory surgery, and/or maintaining a quota for Medicaid patients. What other options exist. Please review all the above and recommend what we should do and provide the supporting information regarding your recommendations.