Brookside Hospital's imaging for hand, foot and forearm is a sub-unit of the Radiology department. They...

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Brookside Hospital's imaging for hand, foot and forearm is a sub-unit of the Radiology department. They project ending the current year (2017) with 2,000 total procedures broken down as follows: Procedure Hand imaging Time Required 10 minutes Volume Rate proportion (Charge) 60% $100 Foot imaging 20 minutes 30% $300 30 minutes 10% $400 Prepare a professional document to present to the VP of Radiology which will include separate tables for each of the following: 1. Prepare a statistics budget summary by procedure and payer 2. Prepare a gross and net revenue worksheet by procedure and payer. Hint: prepare a table for each procedure and then one for the total of all procedures. 3. Prepare an expense worksheet based on the volume increases and the rate increases for each of the three types of expenses. Do not separate the expenses by procedure only by type of expense. 4. Prepare a summary income statement for overall revenues and expenses. Include appropriate header. Forearm imaging This sub-unit accounts for 20% of the Radiology department's current expenses of $1,225,000 broken down as follows: Expense Amount Labor $425,000 Imaging Materials $300,000 Overhead $500,000 Total $1,225,000 Payer Mix and Reimbursement is as follows: Volume Payer proportion Reimbursement Medicare 50% 70% of charges Medicaid 20% 50% of charges Managed care Self Pay 20% 80% of charges 10% 100% of charges * 20% of the self pay result in charity care Budget Assumptions for 2018: Volume increase is expected to be 10% with the same procedure mix . Due to volume increase, all three expenses are expected to increase 10%, in addition: Labor rates are expected to increase 5% due to merit increases The cost of Imaging materials are expected to increase 6% Overhead rate is expected to stay the same Required: Brookside Hospital's imaging for hand, foot and forearm is a sub-unit of the Radiology department. They project ending the current year (2017) with 2,000 total procedures broken down as follows: Procedure Hand imaging Time Required 10 minutes Volume Rate proportion (Charge) 60% $100 Foot imaging 20 minutes 30% $300 30 minutes 10% $400 Prepare a professional document to present to the VP of Radiology which will include separate tables for each of the following: 1. Prepare a statistics budget summary by procedure and payer 2. Prepare a gross and net revenue worksheet by procedure and payer. Hint: prepare a table for each procedure and then one for the total of all procedures. 3. Prepare an expense worksheet based on the volume increases and the rate increases for each of the three types of expenses. Do not separate the expenses by procedure only by type of expense. 4. Prepare a summary income statement for overall revenues and expenses. Include appropriate header. Forearm imaging This sub-unit accounts for 20% of the Radiology department's current expenses of $1,225,000 broken down as follows: Expense Amount Labor $425,000 Imaging Materials $300,000 Overhead $500,000 Total $1,225,000 Payer Mix and Reimbursement is as follows: Volume Payer proportion Reimbursement Medicare 50% 70% of charges Medicaid 20% 50% of charges Managed care Self Pay 20% 80% of charges 10% 100% of charges * 20% of the self pay result in charity care Budget Assumptions for 2018: Volume increase is expected to be 10% with the same procedure mix . Due to volume increase, all three expenses are expected to increase 10%, in addition: Labor rates are expected to increase 5% due to merit increases The cost of Imaging materials are expected to increase 6% Overhead rate is expected to stay the same Required:

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