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Business Proposal
Maab Khalil
Executive Summary
The Health Information Technology (HIT) has been advancing for the past two decades
replacing the manual and outdated paper medical records and financial billing system. This
electronic health record (EHR) system. eClinicalWorks automated solution can be the can be
beneficial at Heartland Health's primary practices. These benefits can advance Heartlands medical
record system by illustrating flowsheets to capture information and activities, capturing medical
billing transactions and recording them in the appropriate subsidiary journal, and communicating
financial information effortlessly. These features can improve Heartland Health management
attractiveness, interoperability, and functionality compared to other top EHR systems in the
healthcare market. Its price tag includes an electronic medical record (EMR), Practice Managment,
eClinicalMobile, Patient Portal, and eClinalMessenger with no start-up costs. eClinicalWorks will
deliver the satisfaction and value that will help Heartland Health ensure an excellent quality of
care in practice and holding health care providers centered on patient care with lower costs.
For this to be successful heartland health must have a well-functioning organizational chart,
which will be beneficial to the core output of the team. The organizational chart of Heartland
Health consists of a Medical Director, Medical Doctor, two Nurses, a biller, two receptionists, and
five medical assistants. The Medical Director will oversee the clinical services and front office.
The clinical services delegate the medical assistants and the registered nurses, while the front
office, will take command of reception scheduling and billing. Heartland Health organizational
chart must depicts the model of how administrators are required to make decisions in the primary
BUSINESS PROPOSAL
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care practice. Technology specialist will be assigned to take charge of installing the software,
hardware, and maintenance of the system. EHR trainers will train staff to input medical records,
health records, physician notes, billing information, and drug prescription. An active leadership
role in the primary practice is significant to the success of the organization. Respect, motivation,
positive reinforcements, and the delegation of responsibilities to the staff are essential qualities for
Installation of eCLinicalWorks EHR in the offices of Heartland Health will cost $44,200
in the first year and after implementation RVU's will increase by 1200 with additional revenues of
$54,000. The operating margin is 18.15% and the cost per unit for Year 1 is $36.83. The end
events (ADEs), enhancing the efficiency of care delivery, promoting quality of care, lessening
costs, and conserving money over the longer term. For a successful implementation of this new
culture, an essential marketing plan should focus on five principals to be successful. Position the
product, tapping into the mind of the customers and healthcare providers, listening to customers
feedback, creating a simple slogan that will represent the product's identity, and tracking results
will support the foundation of a successful EHR system in the HCO. Healthcare leader should also
between health care providers regarding the patient wellness and health. Cementing
eClinicalWorks EHR system with a large-scale survey to see the trends produced by the EHR
system will increase awareness and influence early adopters to spread this new product to the
laggards.
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The United States (U.S) healthcare organization (HCO) is the result of decades of reform
due to the influence of health policy researchers and decision makers to provide a suitable
payment plan and quality of care to the public. One of the essential economic disparities between
HCO and other business is the way in which customers or patients pay for the service they
Most businesses use billed charged payment system, which presents customers with
quality healthcare services charged at a suitable price. Other HCO uses fixed price per unit
service, primary payment system, designed by the business and not the consumer. Until the early
1980's, cost reimbursement by Medicare was the most dominant form of payment for most
hospitals and other institutional providers. Also, state Medicaid plans paid hospitals through the
Historical Cost Reimbursement. Historical Cost Reimbursement has two essential components,
reasonable and apportionment cost. Reasonable cost is limiting payment by excluding specific
categories of cost in which the payers deems reasonable, and apportionment cost is a method in
which costs are assigned to a specific payer, like Medicare. Today, HCO are now using specific
service and fee schedule payment systems for consumers. Specific service system charge payers
through a defined unit of services, while, fee schedule system see payers and providers agree on
historically low rate (Gloria J. Bazzoli, 2014). The recession influenced hospital to cut their cost
of producing services. The impact of the recession caused a tremendous divide between the
financially weak hospital and financially strong hospitals. The loss of employment and health
coverage from customers caused a financial strain to HCO. There are also many factors that
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caused a strain in hospital performance, like, poor management leading to constant financial
through technology, and the support to manage financial risk. U.S Hospitals are now using the
Centers for Medicare and Medicaid Services Healthcare Cost Report Information System (CMS
Form 2552) data to improve the efficiency of care (Jason Turner, 2015). The CMS data also give
hospitals the framework to evaluate the quality of earnings by using the DuPont analysis.
Increasing the return on equity (ROE) through profit margin, total asset turnover (TATO), and
With the recent improvement of healthcare efficiency and profitability, many consumers
have seen a surge in drug costs. According to a study (Ana D. Vega, 2016), the rise of drug cost
too" drugs. This change led pharmacy benefit managers (PBM), health plans sponsor, and retail
pharmacies to find other avenues to increase profit at the expense of the consumers.
U.S healthcare has seen a lack of physicians, specifically, in Hawai'i due to concerns of
low payment that has become crucial. A report from FAIR Health, a company that tracks private
insurance reimbursement rates that Hawaii has the lowest reimbursement rates and that
physicians are reimbursed significantly lower than cities with the similar cost of living by both
Medicare and private insurance. Meanwhile, Nebraska has the highest physician reimbursement
rates in the U.S. To fix this variation in payment; the U.S health care have revised payment
methodologies that increase pay for services, Geographic Prices Cost Indices to adjust payment,
and applying the 10% Medicare Bonus Program for physicians working in areas of need.
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The Health Information Technology (HIT) has been advancing for the past two decades
replacing the manual records system embedded in the healthcare sector. According to Wheatley
(2013), this sluggish but progressive approval of health information technology (IT) nationwide
warrants a new era in the healthcare industry. Heartland Health primary practice can benefit from
these HIT advance in it medical record system, illustrating flowsheets to capture information and
activities, capturing medical billing transactions and recording them in the appropriate subsidiary
journal, and communicating financial information effortlessly. The product and service that can
perform all these criteria's and improve Heartland Health management efficiency is
industry leader in excellence and satisfaction. eCLinicalWorks cloud-based EHR was designed
to meet the challenges of value-based care. Health care providers will enjoy the ease in the
documentation, interoperability, access to patient data anytime and anywhere; using the web
browsers, smartphones, and tablet devices. It also offers pioneering solutions for Patient
Engagement and Population Health, generating cycles of care that help providers adequately
recognize patient needs, assess risk, and encourage more efficient processing and results. Baker
et al., (2018) stated that technology and patient engagement work together and it will make the
patient be an active participant in his or her healthcare. Streamlining workflows and offering
Heartland Health. With a no-cost on-demand activation, providers can exchange knowledge with
Epic and Cerner hospitals through the CommonWell Health Alliance and Carequalit leading to
sound clinical decisions. eClinicalWorks integrated telemedicine solutions offer patients the
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choice of an in-office visit in the comfort of the patient’s home. It also expands on the regular
visit by allowing other healthcare providers and medical experts around the globe. The following
Table 1
Competitive Analysis
Price Attractiveness M L M
Functionality H M H
Interoperability L M H
Note. L = Low, M = Medium, H = High.
The above table shows a descriptive analysis of the buying criteria for an EHR system.
The criteria include Price Attractiveness, Functionality, and Interoperability. The analysis rates
eClinicalWorks and its competitors from High (H), Medium (M), and Low (L). The analysis
presents eClinicalWorks and Cerner price more attractable than Epic due to its high costs. The
eClincalWorks price tag includes an electronic medical record (EMR), Practice Managment,
eClinicalMobile, Patient Portal, and eClinalMessenger with no start-up costs. The second
analysis in functionality or easy usability indicates that both Cerner and eClinicalWorks are rated
high. Lastly, eClincalWorks is rated a high in the interoperability criteria compared to both
Cerner and Epic. eClinicalWorks will deliver the satisfaction and value that will help Heartland
Health ensure an excellent quality of care in practice and keeping healthcare providers centered
Heartland Health is a primary care practice in the Southwestern United States. It consists
of a medical director, medical doctor, and two nurse practitioners, their objective is to provide
outpatient medical care for residents. This report will give an overview of the annual cost
assumption, the relative value scale (RVU) cost, the one-month expense budget, and the one-
month productivity report at Heartland Health. This overview will bring an understanding of
The annual cost assumption in provider time, which includes annual salary payment of a
medical director, a medical doctor, and two nurse practitioners will cost $690,000 in provider
time. Technology cost is $30,000, which contributes to the acquisition of two electrocardiograms
(EKG), eight computers, two copiers, two ultrasound machines, and two electronic scales.
Supply costs of $25,000 which comprise of paper, tongue depressors, bathroom, and exam
supplies. Heartland Health also has an indirect cost in financing five information technologist, a
biller, two receptionists, and four medical assistants. Leasing two office suites with utilities per
suite will result in a total of $358,000 in indirect cost. Hence, the total annual expense will be
$1,106,000.
The RVU is a method of budgeting used to calculate the resource consumption, the basic
unit of service in Heartland Health's RVU is 15-minutes office visit. A provider works 40 hours
per week and a 1 hour for lunch breaks; this will give 35 hours of work time per week. Each
health provider has two weeks of vacation time per year, and the remaining 50 weeks will be
multiplied by 35 hours producing a work time of 1,750 hours annually. For monthly, 1750 hours
will be divided by 12 months delivering 145.83 hours per month per provider. With four
providers it will be 583.32 hours per month. Multiplying the four provider RVU's with 583.32
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hours per month will give a product of 2333.3 of RVU's per month. To obtain a monthly
expense, $690,000 divided by 12 will equal $57,500, 2333.3 RVU then divides this. The average
expense for provider time per RVU is $24.64 per month. Technology, supplies, and indirect cost
RVU per month are $1.18, $0.89, and $12.79, respectively. The Costs and RVU Development
table in the right column show that the costliest component for a visit is the provider time while
When examining the Heartland Health one-month report, the provider time actual cost
was found to be $56,000. The provider time budget was $57,508.50, and this gives a variance of
$1,508.50 which is favorable. The actual technology cost was $3000 compared to its budget of
$2752.94. This symbolizes an unfavorable variance of $247.06. Actual supply cost in the
expense budget was $2,588, and the budget was $2,076.50. The supply cost went over the budget
by $511.50, an unfavorable variance. The actual indirect cost was $28,965 with a budget of
$29,839. The indirect cost indicated a favorable variance of $874. The unfavorable variance
could be due to maintenance fees in the technology costs and an ordering more supplies than
needed. The total actual one-month expense was $90,553 with a budget of $92,270. This
financial show a favorable variance. The $1,717 difference can be used in purchasing new
Dissecting Heartland Health's one-month productivity report in both Heartland South and
North offices, the finance shows that the actual total RVU was 2277 compared to the RVU
budget of 2333. This unfavorable report could be due to a hurricanes or natural events that
Leadership
always highlight its achievements of having a well-functioning organization control system. This
control system is essential to understanding the complex blueprint of the entire organization. In
the core output of the team. It is an important factor in the supervision of the organization and
hence the structure of the organization will affect the financial management of Heartland Health.
The organizational chart of Heartland Health consists of a Medical Director, Medical Doctor,
two Nurses, a biller, two receptionists, and five medical assistants. The Medical Director will
oversee the clinical services and front office. The clinical services delegate the medical assistants
and the registered nurses, while the front office, will take command of reception scheduling and
billing. Heartland Health organizational chart depicts the model of how administrators are
For the electronic health records (EHR) system to be a success at the primary practice,
potential hiring is essential to the success of eClinicalWorks' EHR. Technology specialist will be
assigned to take charge of installing the software, hardware, and maintenance of the system.
EHR trainers will train staff to input medical records, health records, physician notes, billing
An active leadership role in the primary practice is significant to the success of the
to the staff are essential qualities for the advancement of Heartland Health. The medical director
will delegate clinical response to the health care providers; each one will be responsible for there
workflow process. It will improve the working relationship between doctors, nurses, and medical
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assistant, resulting in the success of the clinical department. The medical director along with the
medical staff and the front office will review the eCLinicalWorks EHR proposal, providing
views on the benefits of the system and how it will improve the efficiency of the practice. The
front office billing department will look into the financial budget to implement, install, and
maintain the EHR system. Once a financial budget becomes sound, the Medical Director will
approve the budget for the new EHR system at Heartland Health.
With the implementations, Heartland Health will become a striving primary practice in
the community. Providing quality, efficient, and cost-effective care that will be a vital role model
to all small healthcare practices in the United States. Heartland Health strategic vision plan is to
provide the best healthcare service in the country and its mission is to be the number one
Several factors will influence Heartland Health goals by the strength, opportunity, and
threat (SWOT) analysis. Heartland Health strengths are its Healthcare providers presence in the
community, each with over 15 years of experience in healthcare, and its geographic location in
the community. Its weakness is the lack of an EHR system that will significantly improve the
billing, record storage, and reducing cost in practice. Another weakness is the location of offices
being 14 miles apart and leased in strip malls with other five businesses. Heartland's
opportunities come in the announcement of Yamaha Industries, bringing in 3,000 full-time jobs
in the community. This will result in the increase in work and billable at the primary practice;
Heartland Health will then be the sole health care provider in the community. Heartland's threat
is the emergence of a successful and popular HMO located in a town nearby; another threat is the
1. Sales/Revenue—First year’s annual volume increase is 100 RVUs per month x 12 months =
1200 RVU/yr. Revenue is RVU= $45. 1200 x $45 = $54,000. Second and third year annual
increases in patient visits of 80 visits a month= 960 RVU/yr. x $45 = $43,200. Similar electronic
visits/revenue due to ability to send automatic text messages reminders of visits and seasonal
A study (Howley et al., 2014) conducted to see the long-term financial impact of
electronic health records implementation show that reimbursements significantly increased after
EHR implementation even though the number of patient visits decreased over the 2-year
observation period. The application was also associated with an increase in ancillary office
procedures, for example, drawing blood, immunizations, wound care, and ultrasounds.
Expense Assumptions
5. Salaries and wages--Training and productivity loss; 4 providers 40 hours training each x
required—No additional.
depreciation (refer to page 264 in textbook for more details) Amortization schedule records the
9. Interest—none (use when loan is involved and cost of interest must be considered)
22. Volume statistic—RVU = 15 minutes of office time with provider; the volume indicator
relates to the sales/revenue: Year 1: 1200, Year 2: 960, and Year 3: 960
Expenses
5.Salaries and Wages 36,200 -- --
6. Material and Supplies -- -- --
7. Contract Services and Fees 8,000 8,000 8,000
(technology)
8. Depreciation and Amortization -- -- --
9. Interest -- -- --
10. Total Expense 44,200 8,000 8,000
Cash Flow
Year 1 Year 2 Year 3
Sources
12.Net Income 9,800 35,200 35,200
13.Depreciation -- -- --
14.Borrowing -- -- --
15.Total sources 9,800 35,200 35,200
Uses
16.Capital purchasing 9,000 -- --
17.Working capital --
18.Total uses 9,000 -- --
Volume
Year 1 Year 2 Year 3
22. RVU (Volume statistic) 1200 960 960
23. Cost per unit 36.83 36.7 36.7
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Financial Summary
electronic medical record (EMR) in the offices of Heartland Health (Table 1). In the first year,
RVUs are forecast to increase by 1200 with an additional revenue of $54,000. The first year’s
operating expense of for the EMR installation is $44200. The operating margin is 18.15%. The
cost per unit for Year 1 is $36.83. A capital cash purchase of 9000 is required. Cash at ending of
Marketing
The evolution of the health care system in the adoption of electronic health records (EHR)
trends have sprung trends in the healthcare organizations (HCO). With the implementation of EHR
HCO have seen an increase in capabilities in the workplace. It allows recording and retrieval of
the essential elements of medical records, like, patient demographics, encounter notes, patient
medication, patient complaints, system review, past medical history, problem lists, procedure
notes, and lab notes. This feature allows management of results of laboratory and imaging tests,
prescribing drug, tracking immunizations, and using clinical guidelines and protocols (Gans et al.,
2005). These features will ultimately lead to benefits to the practice. These benefits are the
reduction of medical records staff expenses, medical records storage costs, transcription costs,
medical records transportation costs, and physician recruitment. EHR system will improve the
advances in HCO. It holds commitments of diminishing adverse drug events (ADEs), enhancing
the efficiency of care delivery, promoting quality of care, lessening costs, and conserving money
over the longer term. With these advantages, there is a disadvantage concerning the cost of
purchasing the EHR systems, installation, and maintenance. The average EHR system ranges from
$18,000 to $35000 with maintenance and installation of $8,000. It is essential to assess the cost
versus effectiveness in order to determine the value the EHR system will give to any healthcare
practice. Several studies reviewed (O'reilly et al., 2011), found HIT interventions offer cost
from the paper-based industry to one that employs clinical and information to assist providers in
performing a higher quality of care to their patients (Menachemi & Collum, 2011). The use of
reducing the unnecessary use of tests or the need to mail hard copies of test results to different
providers. By presenting patient information more promptly available, EHRs lessen costs related
to chart pulls as well as supplies needed to maintain paper charts. Recent studies (Menachemi &
Collum, 2011) have shown that having an EHR as opposed to a paper file can result in decreased
systems. In order for this to be successful HCO should encourage health information technology
(HIT) champions to influence their organization and healthcare practices, to bring about a change
in the workplace and inspire the lagers to adopt the new HIT culture.
For a successful implementation of this new culture, an essential marketing plan should
focus on five principals to be successful (D'Andrea, 2017). Position the product, tapping into the
mind of the customers and healthcare providers, listening to customers feedback, creating a simple
that will represent the product's identity, and tracking results will support the foundation of a
successful EHR system in the HCO. The Market campaign must include a local television
advertisement that promotes the product and services, and a 2-minute facebook advert add that
increase the awareness of Heartland's Health new EHR systems, and a letter sent to the community
inviting them to a question on the product and services. Reliable email messaging is part of a
national transformation initiative in the United States to encourage new standards of care that
further enhances patient-provider communication (Haun et al., 2015). These steps will increase the
market awareness of our product and would increase the peer pressure on the laggards by the early
adopter.
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Reference
Ana D. Vega, P. P. (2016). Commentary on Current Trends in Rising Drug Costs and
Gloria J. Bazzoli, N. F. (2014). Hospital Finacial Performance In The Recent Recession And
Implication For Institution That Remain Finacially Weak. Health Affairs, 739
Baker, J. J., Baker, R. W. & Dworkin, N. R. (2018). Chapter 3: The Digital Age: Changing the
Landscape of Healthcare Finance. Health Care Finance: Basic Tools for Nonfinancial
Manager (5th ed.) (pp. 23-24). Burlington, Massachusetts: Jones & Bartlett Learning.
Howley, M.J., Chou, E. Y, Hansen, N., & Dalrymple, P. W. (2015). The long-term financial
impact of electronic health records implementation. J Am Med Inform Assoc 22, 443–
Gans, D., Kralewski, J., Hammons, T., & Dowd, B. (2005). Medical Groups’ Adoption of
Electronic Health Records and Information Systems. Health Affairs, 24(5), 1323- 1333.
Menachemi, N., Collum, T. H. (2011). Benefits and Drawbacks of Electronic Health Record
Systems. Risk Management and Healthcare Policy, 2011(4), 47-55. Retrieved from
https://doi.org/ 10.2147/RMHP.S12985
marketing plan.html
Haun, J., Patel, N., Lind, J., & Antinori, N. (2015). Large Scale Survey Findings Inform