MSHM-4352 Financial Budget Project You will use the knowledge gained in this course to financially structure and evaluate the operation of a primary care medical practice with one physician and two physician assistants as providers. The physician is wanting to expand his office by adding two new exam rooms with a budget of $200,000 and 1-year completion deadline. You will be required to prepare an operating and capital budget as well as a narrative summary of at least 800 words to show your financial findings and recommendations. You will provide supporting documentation (excel spreadsheet) to support your findings and recommendations. Prior to writing your narrative summary you will need to prepare an operating and capital budget for the expansion of the practice. Your operating and capital budgets should demonstrate a profound knowledge of the market, pricing, activity, revenues, expenses, and potential impact on cash-flow and/or profitability. The capital budget (Ch. 5) will similarly demonstrate an awareness of the capital items and associated costs for project start-up (2 new exam rooms). Prepare an annual financial report that includes the following: o Volume of patient visits (realistic) o Revenues (percentage of reimbursement from Medicare, Medicaid, Commercial Insurance and Self Pay) o Expenses (Labor, Equipment, Supply, Overhead) o Provide your assumptions to justify all volumes, revenues and expenses Prepare a two-year operating budget that includes the following: o An estimate of revenue each year o An estimate of expenses for each year o The cash flow (negative or positive) generated from revenues and expenses Prepare a start-up capital budget listing the equipment you may need for the expansion of the two exam rooms including the cost and annual depreciation From your operating budget calculate the following: o Projected cash flow over 2 years o Break-even analysis o Internal rate of return (IRR) o Net present value (NPV) From your calculations, evaluate the financial risk involved with this expansion project and make a recommendation as to whether this expansion is financially viable. Prepare a 800-word minimum narrative summary of your financial findings and recommendations. You will provide supporting documentation to support your findings and recommendations