Unit 5 Assignment Action Items

Year to Date Percent of Budget
Worksheet: FY XXXX
Service Forecast
Total RVUs
Physician work RVUs
Encounters
Total procedures
Income
Fee-for-service collections
Other revenue
Total Practice Income
Operating Expenses
Total employee salaries
Employee retirement contributions
Other employee benefits
Temporary support staff
Information technology depreciation
Information technology supplies and maintenance
Telephone/internet access
Drugs
Medical and surgical supplies
Building rent
Building maintenance and utilities
Property taxes
Furniture and equipment maintenance
Furniture/equipment depreciation
Administrative supplies and services
Laboratory equipment depreciation
Laboratory maintenance and supplies
Radiology equipment depreciation
Radiology maintenance and supplies
Accounting services
Legal services
General liability insurance-G&A
Prof liability insurance
Promotion and marketing
Total Operating Expenses
Annual Budget
$
$
$
55,000
31,000
32,000
50,000
4,059
2,155
2,155
4,099
3,002,177
42,149
3,044,326
222,356
3,100
225,456
$
946,156
78,854
69,537
21,400
44,925
9,788
3,200
136,285
72,238
208,012
11,450
6,235
9,340
28,650
51,737
53,666
35,000
24,020
6,733
4,800
13,287
6,739
49,024
8,330
1,899,406
Amount Available for Distribution to Physician Owners
$
1,144,920
Physician salaries
Physician distribution
Physician retirement contribution
Physician meetings & travel
Physician other fringe benefits
Total Physician Compensation and Benefits
$
900,000
57,255
107,700
23,750
56,215
1,144,920
Net Income after Physician Distributions
$
$
JAN
–
$
78,846
6,571
5,795
1,783
3,744
816
670
11,400
6,256
17,334
954
3,117
778
2,388
4,312
4,472
2,900
2,002
561
395
1,159
591
694
157,538
67,918
$
$
60,000
6,600
1,980
4,848
73,428
$
(5,510)
Copyright © 2009. All Rights Reserved. Medical Group Management Association. This sample budget uses fam
the MGMA Cost Survey for Single Specialty Practices: 2008 Report Based on 2007 Data. The budget is based on
How to Use this Tool: The budgeting process involves monitoring an organization on a period to period basis.
date percent of budget worksheet is meant to be a template for medical practice administrators to use monthly
administrators to compare their organization’s actual financial performance to the predicted annual budget and
and control finances. By reviewing performance on a monthly basis an administrator is in a better position to m
adjustments to compensate for any deviation from the budget.
Column O has the calculation for “Year to Date Total” and Column P has the calculation for “Year to Date Percen
will show how much of the budgeted amount for the particular entry is spent year to date. For example, if it is t
percent of budget of any particular entry would ideally be around 50% of budget, as June is the midyear mark.
In physician-owned medical groups, the compensation of the shareholder / owners is the amount that remains
revenue after all expenses are paid. On a practical basis, most practices pay the doctors a predicted amount m
distribution of any excess revenue. In the sample budget, the distribution occurs quarterly, in March and June.
net income of the practice was zero because the excess revenue was distributed to the physicians as compensa
FEB
$
MAR
MAY
JUNE
4,300
2,459
2,210
4,122
4,500
2,583
2,666
4,512
4,670
2,789
3,001
4,569
5,002
3,012
3,600
4,989
4,100
2,256
2,100
4,256
245,788
3,456
249,244
257,808
3,711
261,519
259,760
3,799
263,559
260,441
3,511
263,952
245,100
3,690
248,790
78,846
6,571
5,795
2,559
3,744
852
201
11,659
6,152
17,334
988
812
2,388
4,533
4,472
3,120
2,002
575
450
1,100
591
49,024
725
204,493
$
44,751
$
APR
78,846
6,571
5,795
1,700
3,744
765
256
36,000
6,250
17,334
942
810
2,388
4,623
4,472
3,266
2,002
589
425
1,120
598
723
179,219
$
82,300
$
$
60,000
6,600
2,562
4,985
74,147
$
(29,396)
78,846
6,571
5,795
2,650
3,744
740
260
6,559
6,936
17,334
978
792
2,388
4,459
4,472
2,998
2,002
612
436
1,256
563
698
151,089
$
112,470
$
$
60,000
9,116
6,600
1,988
4,596
82,300
$
–
$
$
$
39,235
n on a period to period basis. This sample year to
administrators to use monthly. It allows
predicted annual budget and allows them to monitor
tor is in a better position to make adequate
$
106,293
60,000
6,600
1,955
4,680
73,235
This sample budget uses family medicine data from
Data. The budget is based on a 5 FTE Physician
78,846
6,571
5,795
2,160
3,744
891
198
14,899
5,897
17,334
954
785
2,388
4,500
4,472
2,917
2,002
541
399
1,106
548
712
157,659
$
$
60,000
6,600
1,897
4,652
73,149
$
33,144
JULY
–
78,846
6,571
5,795
1,785
3,744
650
201
10,266
6,020
17,334
956
776
2,388
4,200
4,472
2,987
2,002
589
381
1,189
589
700
152,441
–
96,349
–
–
$
60,000
22,265
6,600
2,695
4,789
96,349
$
–
$
–
$
–
ation for “Year to Date Percent of Budget.” Column P
to date. For example, if it is the end of June, the
as June is the midyear mark.
is the amount that remains from total practice
octors a predicted amount monthly with a periodic
quarterly, in March and June. In these months, the
the physicians as compensation.
AUG
SEPT
OCT
NOV
Year to Date
TOTAL
DEC
$
$
$
$
26,631
15,254
15,732
26,547
1,491,253
21,267
1,512,520
473,076
39,426
34,770
12,637
22,464
4,714
1,786
90,783
37,511
104,004
5,772
3,117
4,753
14,328
26,627
26,832
18,188
12,012
3,467
2,486
6,930
3,480
49,024
4,252
1,002,439
–
–
–
–
–
–
–
–
–
–
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
–
–
–
–
–
$
510,081
360,000
31,381
39,600
13,077
28,550
472,608
37,473
–
–
–
–
–
$
–
$
–
$
–
$
–
$
–
$
$
$
$
$
$
$
–
$
–
$
–
$
–
$
–
$
Year to
Date
Percent of
Budget
48%
49%
49%
53%
50%
50%
50%
50%
50%
50%
59%
50%
48%
56%
67%
52%
50%
50%
50%
51%
50%
51%
50%
52%
50%
51%
52%
52%
52%
100%
51%
53%
45%
40%
55%
37%
55%
51%
41%
Budgeting Reporting
1. Using the Budget Worksheet Template, add an additional employee for October – December.
The monthly salary for the employee is $2,000. What impact does that have to your budget?
Don’t forget to include employer Retirement contributions and other employee benefits.
2. Because of demand, the practice is going to add an additional physician for October –
December. The physician’s salary is $8,000 per month. What is the impact to the budget of
adding an additional physician? Don’t forget to include employer retirement contribution.
3. You have negotiated lower rates from your drug provider. Effective July your monthly cost for
drugs will be $11,000. Calculate the annual cost of drugs for the entire year using the input
amount for January – June and the new cost for July – December. What is your actual drug cost?
What percentage of your budget for drugs was utilized for the year?
4. Your landlord has renegotiated your lease. Starting in October, your monthly building rent will
be 19,000. What is your total cost for rent for the year? What percentage of your budget for
rent was utilized for the year?
5. In reviewing the percentages of each category used for the first six months of the year, are there
any areas of the budget that you would adjust either up or down and why?

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