Vision for Kids, a clinic funded by the Community Health Plan, a not-for-prot agency, provides eye examinations,

Vision for Kids, a clinic funded by the Community Health Plan, a not-for-profit agency, provides eye examinations, eye glasses, and eye-related medical care for children from low-income families. Children are referred to the clinic by school nurses and teachers, physicians, and social workers on the basis of poor performance on a vision screening test.
In its current year, Vision for Kids expects to serve 6,200 children. It will give each child an examination and, if needed, issue a pair of glasses. On average, one pair of glasses is issued for each child, since only children who failed the screening test are referred to the clinic, and some children lose or break their glasses after they have been issued.
The total budget (including employee benefits) for the current year is $1,884,000, broken down as follows:
Director .......... $ 150,000
Ophthalmologist (one full-time) . 280,000
Optometrists (2 at $140,000) .... 280,000
Secretaries (2 at $60,000) ..... 120,000
Technician ........... 70,000
Nurses (2 at $80,000) ..... 160,000
Glasses (6,200 at $120) ..... 744,000
Drugs and other supplies .... 30,000
Other operating costs ...... 50,000
$ 1,884,000

Vision for Kids’ ability to serve patients is limited by available funds. Were there sources available, it could easily serve twice as many patients. It receives all funds from its parent organization.
The ophthalmologist examines only those children referred to him by one of the optometrists. He is currently examining and treating the maximum number of patients in the available time (approximately 1,300—one out of every four children served by the center). The director estimates, however, that the organization would be able to hire an additional ophthalmologist on a one-quarter-time basis for $60,000 per year.
The director has also determined the following:
• An additional secretary would have to be added when the number of patients reaches 8,000.
• The currently employed ophthalmologist and two optometrists would not accept less than full-time employment. In light of their extensive experience, it would be uneconomical in the long run to reduce their appointments to less than full time and replace them with part-time personnel (except, of course, as a last resort). By contrast, one of the nurses has indicated a willingness to drop down to either three-quarter time or half-time status.
• Additional nurses and ophthalmologists can be added in quarter-time increments. Optometrists can be added only in half-time increments.
• Each optometrist can handle 3,200 patients per year; additional optometrists can be hired on a one-half time basis for $60,000.
• Each nurse can also serve 3,200 patients; nurses can be hired on a quarter-time basis for $20,000.
• The technician can handle at least 10,000 additional patients.
• Variable cost per patient is $128, determined as follows:
Glasses ........ $120
Drugs and other supplies ... 4
Other operating costs ..... 4
Total variable costs .... $128

The staff has submitted requests for many small items of equipment totaling $100,000 in costs. Although this equipment would not enable the clinic to serve additional patients, it would improve their care. Prepare a zero-base decision package to be submitted to Vision for Kids’ parent organization. Consider Vision for Kids to be an activity that is part of a children’s health care program. Funding should be requested at the following levels, in addition to the current level:
• 90 percent ($1,695,600) of the current level
• 105 percent ($1,978,200) of the current level
• 120 percent ($2,260,800)

These percentage levels, however, should be interpreted only as approximations. If a major increase in efficiency (e.g., cost per unit of outcome) could be effected by operating at a level slightly greater or less than those specified, then the request should be at that level. Similarly, if all funds up to the stated level could not be used productively, then a lesser amount should be requested. Based on your own judgment provide output and outcome measures, alternative means of carrying out the activity, and consequences of not performing the activity.