Homework: Capital Budgeting and Projections
Perform an internet search for a current health care organization of your choice (preferably publicly traded for-profit organizations because these organizations must report all financial data and make it available to the public). In your search, select and evaluate the report of the financial information from the past 4 quarters or more. Complete the following for this homework:
1) Predict the effect of changes in all financial metrics to changes in a proposed strategic plan in your chosen organization for the following 3 scenarios:
a. Payer mix changes from 50% Medicare and 5% Medicaid patients to 70% Medicare and 10% Medicaid patients in 1 year.
b. Professional turnover goes from 5% annually to 10% annually.
c. Demand for services increases 20% in 1 year
2) Search course materials including your text and the Internet for assistance in completing applicable financial calculations for this homework.
3) Using the statements that you located, provide a financial plan that will do the following:
a. Create projected financial statements to analyze effects of alternate operating assumptions on the firm's financial condition.
b. Determine the projected financial requirements that will be needed to support each of the 3 sets of alternate operating instructions.
c. Forecast the financial sources that might be needed to support your alternative assumptions.
d. Assess the projected results using a financial condition analysis to the forecasted data.
4) Provide appropriate spreadsheets such as Projected Income Statement and Projected Balance Sheets to validate your projected assumptions.
5) Consider the effect of the following factors to justify the changes that may be needed to the strategic plan as a result of your analysis:
a. Validity of data in the decision-making process
b. Revenue growth rate
c. Capacity
d. Rate of turnover
Format your homework according to the following formatting requirements:
(1) The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
(2) The response also includes a cover page containing the title of the homework, the student's name, the course title, and the date. The cover page is not included in the required page length.
(3) Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.