Columbia Memorial Hospital Case Study Essay

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Columbia Memorial Hospital Case Study 1. Using the historical data as a guide (Exhibit 6.1), construct a pro forma (forecasted) profit and loss statement for the clinic's average month for all of 2010 assuming the status quo. With no change in volume (utilization), is the clinic projected to make a profit? With no change in volume of 45 patient visits per day, the clinic is not projected to make a profit. 45 patient visits per day x 30 days in a month = 1,350 visits per month x 12 month = 16,200 visits per year Using the average data given (2010) of 45 patients per day, average $130 revenue per patient, and a cost of $3.50 per patient. The Forecasted P&L Statement is shown below. Forecasted Columbia Walk in Clinic…show more content…
Break-Even Graph Without Marketing Campaign for Columbia Walk-in Clinic Key: Red Line: Fixed Costs Green Line: Total Costs Blue Line: Revenue Key: Red Line: Fixed Costs Green Line: Total Costs Blue Line: Revenue 3. Repeat the Question 2 analysis, but now assume that the new marketing program is implemented. USING JAN/FEB 2010 MONTHLY AVERAGE DATA With the new marketing program, there should be an additional 27.9 ≅ 28 visits per day. Calculation: $7,000 for new marketing program per month $3.50 variable costs of treating each patient $40.66 average revenue per patient $16,000 semi-fixed costs per month $40.66 x visits = $88,934 (total expenses) Visits = 2,187.26 – 1,350 = 837.26 visits per month/ 30 days = 27.9 visits per day or 28 extra visits per day Break-Even Graph With Marketing Campaign for Columbia Walk-in Clinic Key: Red Line: Fixed Costs Green Line: Total Costs Blue Line: Revenue Key: Red Line: Fixed Costs Green Line: Total Costs Blue Line: Revenue 4. Now focus solely on the expected profitability of the proposed marketing program. How many incremental daily visits must the program generate to make it worthwhile? (In other words, how many incremental visits would it take to pay for the marketing program, irrespective of overall clinic
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