Department Head Financial Report

The content discusses a financial report for a new dental clinic. The total cost of operations is $54,227,950, while the anticipated income in the first year is $54,367,950. This results in a predicted profit of $1,40,000. The report outlines the costs and income from various categories such as dentist, receptionist, nurse, medical equipment, cleaning people, insurance, marketing, and advisory services.

Business Budget Case of Dental Care service

Contents
Executive Summary.....................................................................................................2
Outline..........................................................................................................................3
Background..................................................................................................................3
The Proposal................................................................................................................3
Risks.............................................................................................................................4
Process........................................................................................................................5
Resources....................................................................................................................5
Reporting of outcomes.................................................................................................6
Financial Information....................................................................................................6
References...................................................................................................................7
Attachment 1................................................................................................................8
Attachment 2................................................................................................................8
1

Executive Summary
A business case for a centre to provide dental service in Nepean Blue Mountain
Local Health District has been devised in this report while assessing the break even
cost anatomy. The estimated cost of the project and break even cost anatomy has
been explored thoroughly. All the supporting financial data has been provided along
with the report.
2

Outline
The target of this report is to assess the business case to open a new dental care
centre in Nepean Blue Mountain Local Health District. The requirement for dental
clinic in that specific region will be discussed. The financial and administrative
infrastructure required for the project will be mentioned elaborately.
Background
Studies show that 64% of people suffered from dental problems (Johnson et al.,
2015). Keeping the growing need for dental care in that particular area, dental health
service is required. Proper and dedicated dental care is not provided by the hospital
at this particular moment. Due to this, a lot of patient has to move to other places to
get their dental treatment. The problem of diseased, crooked and missing teeth is
quite common these day. Not to forget cavities where the root of the teeth get
exposed. Statistical data of these diseases show how necessary it is to have a dental
section in the hospital. To open a new centre will require some financial investment
to bear the expenses of mainly doctor, nurse and other staffs. A certain part of the
investment will be used to buy equipment needed. So a business plan should be
devised well in advance to ensure that the investment is recovered within a certain
period of time.
The Proposal
Keeping the increasing demand for dental care, the dental service centre is required
within the premises of the hospital; it should be taken care of that the investment
made is retrieved within a certain period of time (Masoe et al., 2014). The fees
collected from the patients are regarded as the main source of income in this case
that will help retrieve all the expenditures for the project.
Aim
The aim of the project is to reduce the torment of the patients who have to go to other
places to treat dental problems by giving them a quality dental care service within
their vicinity without making a hole in their pockets. The dental care centre needs to
deliver excellent service at a reasonable price to earn more customers. Quality of
service and price are two key factors in this case. A short time break even analysis
must be done by the management of the hospital to understand the progress of the
dental centre (George et al., 2017). The satisfaction of the patients is the goal of the
centre. So, it is anticipated that most of the investments in this context will be
retrieved from the fees earned along with some other charges from the patients. To
ensure this, quality service should be delivered by the centre at an affordable cost.
Benefits
 Efficiency gains
As discussed, the main goal of the dental centre is to deliver excellent service to the
patients suffering from dental problems. Thus the effectiveness of the entire hospital
will certainly be enhanced due to the dental service. The development of a proper
resource management section is required to increase the efficiency of the centre.
The human resource management will be required to track and enhance the
efficiency of the doctors, nurses and the other staffs to attain highest level of patient
satisfaction. Patient satisfaction is the only way to earn revenue.
The dental care centre needs to strive for achieving highest customer satisfaction so
that the invested amount can be retrieved with a considerable amount of profit (Hill et
al., 2018).
3

 Potential savings/increased costs.
In current scenario, a lot of patients have to move outside the town to get their dental
issues treated. Keeping that in mind, a dedicated centre to provide dental care needs
to be established with the hospital ground. This will help earn more patients which in
turn will make the gross revenue higher. The setting up of new centre will require a
certain investment to bear the expenses of the salary of doctors, nurses and other
staffs and to buy necessary equipments.
It is extremely necessary to retrieve the investment within a certain period of time in
order to cope up with the risk factors involved in this project (Monaghan & Morgan,
2015). Some other expenses like electric bills, insurance premium, consultancy
services and some other expenditure need to be taken into consideration apart from
the core expenditures. Moreover the deprecation cost of the equipments in the
coming time should be calculated to assess the appropriate cost of the centre.
 Anticipated benefits of this proposal
Factor Benefits
Patients The major goal of the centre is to treat the patients who have to travel
out of the town to get their dental issues treated. Patients are the key
to generate revenue with capital invested in this case. So, to attract
more patients, the centre should provide excellent service at an
affordable price. The only way of receiving more patients is to attain
maximum level of customer satisfaction.
Facility The facilities of the centre totally depend on customer satisfaction that
is the key to success. The first and foremost facility required is to
provide excellent service. The behaviour of the staffs are another
important aspect to keep in mind (Cleverley & Cleverley, 2017). Next,
faculties with expertise in dental care are required. Specialization
contributes in building a good name, Las bu not the least, he services
should be provided at an unmatched price in the neighbouring area.
Clinicians The efficiency and the expertise of the clinicians are the key to build a
reputation for the centre. The specializations of the doctors in the
particular field will help get more patients. Skilled nurses are also
needed to provide excellent service (Shariff & Edelstein, 2016). Proper
training should be provided to all the clinicians to serve the patients
better.
Other The reputation of the hospital will be higher with the setup of the
dental care centre. The efficiency and the effectiveness of the hospital
as a whole will be increased a lot with the help of this centre. It is
anticipated that the revenue generated by the hospital will experience
a rise with the new centre.
4

Risks
The risks, predicted or real, involved in this project are listed below:
Risk
Issue Severity Impact Mitigation
Plan Notes
Financial
risk
As a considerable
amount of capital
is invested in this
project, a proper
plan needs to be
developed on
how to retrieve
the money.
The increase
rate of capital
invested
increases the
risk of
recovering the
capital. To bear
the expenses, if
the investment is
not retrieved, the
quality of the
services will be
affected and be
degraded
(Nasseh &
Vujicic, 2017).
It needs to be
assured that
the quality of
service never
degrades as
the main
source of
income is he
fees collected
from the
patients.
The
management
should look into
the matter that
the risk is at a
minimum level.
The
management
should have a
proper plan to
manage the
risks.
Patients
The patient
satisfaction is the
most important
aspect to take
into
consideration.
The major risk
will be lower
patient
satisfaction by
providing
degraded service
as the major
earning will be
generated by the
patients.
The revenue
generated is
directly
proportional to
the number of
satisfied
patients.
The key to
earn revenue
is to achieve
the highest
level of
patient
satisfaction.
As discussed,
income is
directly
proportional to
the number of
patients, it is
extremely
important to
keep them
satisfied.
Insurances
The expenses for
the insurance is
risky in term of
setting up this
project.
This expenses
will add up to the
operational cost
of the
organisation.
The premium
should be
paid on time
to avoid the
fine.
In this case,
insurance is a
key factor to
ensure extra
security.
Process
 Action
Doctors having specialization in this particular field and nurses with proper training
are needed to increase the productivity of the centre. An advising committee needs
to be created containing the departmental heads, a financial advisor and doctors. All
the management operations need to be supervised by the advisory group and the
operational parameters need to be examined by the heads (Petti & Vitali, 2017).
5

Resources
Apart from the doctors and the machinery needed, other expenditures are engaged
in the project as well. A rained nurse is needed to provide medicine on time, a
receptionist will be required to take maintain the appointments, staffs are needed to
maintain the equipments. Moreover, electricity bills, water and waste management
are some other key areas to look after to provide the best service (Stoddart & Evans,
2017).
Reporting of outcomes
The receptionist needs to maintain all the financial and operational data and send
them to the department head. The other employees such as doctors, accountants
and cashiers need to submit their reports to the representative and will be procured
by the designated person (Sanjeev et al., 2014).
Financial Information
The main requirement to prepare the budget from a zero base are:
 Dentist
 Receptionist
 Nurse
 Medical equipment
 Cleaning people
 Insurance
 Marketing
 Advisory services
In this project, the total cost for the operations of the project is $56,927,950. A
depreciation in the cost has taken place due to decreased production cost, lower
insurance premium etc. After calculating all the costs, the final cost has been
reduced to $54,227,950.
He total cost of operations of this project is $54,227,950 and the total income
anticipated in the first year is $54,367,950. Thus, a profit $1,40,000 is predicted from
this project.
6

References
Cleverley, W. O., & Cleverley, J. O. (2017). Essentials of health care finance.
Jones & Bartlett Learning.
George, A., Ajwani, S., Bhole, S., Dahlen, H. G., Reath, J., Korda, A., ... &
Johnson, M. (2017). Knowledge, attitude and practises of dentists
towards oral health care during pregnancy: A cross sectional survey in
New South Wales, Australia. Australian dental journal, 62(3), 301-310.
George, A., Dahlen, H. G., Reath, J., Ajwani, S., Bhole, S., Korda, A., ... &
Johnson, M. (2016). What do antenatal care providers understand and
do about oral health care during pregnancy: a cross-sectional survey in
New South Wales, Australia. BMC pregnancy and childbirth, 16(1),
382.
Hill, H., Tickle, M., Birch, S., McDonald, R., & Brocklehurst, P. (2018).
Productive efficiency and its determinants in the Community Dental
Service i nthe north-west of England. Dental Health, 34(2), 102-106.
Johnson, M., George, A., Dahlen, H., Ajwani, S., Bhole, S., Blinkhorn, A., ... &
Yeo, A. (2015). The midwifery initiated oral health-dental service
protocol: an intervention to improve oral health outcomes for pregnant
women. BMC oral health, 15(1), 2.
Masoe, A. V., Blinkhorn, A. S., Taylor, J., & Blinkhorn, F. A. (2014).
Preventive and clinical care provided to adolescents attending public
oral health services New South Wales, Australia: a retrospective
study. BMC oral health, 14(1), 142.
Monaghan, N. P., & Morgan, M. Z. (2015). What proportion of dental care in
care homes could be met by direct access to dental therapists or dental
hygienists?. British dental journal, 219(11), 531.
Nasseh, K., & Vujicic, M. (2017). Early impact of the Affordable Care Act's
Medicaid expansion on dental care use. Health services
research, 52(6), 2256-2268.
Petti, S., & Vitali, M. (2017). Occupational risk for Legionella infection among
dental healthcare workers: meta-analysis in occupational
epidemiology. BMJ open, 7(7), e015374.
Sanjeev, R., Kuruvilla, S., Subramaniam, R., Prashant, P. S., &
Gopalakrishnan, M. (2014). Knowledge, attitude, and practices about
biomedical waste management among dental healthcare personnel in
dental colleges in Kothamangalam: a cross-sectional study. Health
Sciences, 1(3), 1-12.
Shariff, J. A., & Edelstein, B. L. (2016). Medicaid meets its equal access
requirement for dental care, but oral health disparities remain. Health
Affairs, 35(12), 2259-2267.
Stoddart, G. L., & Evans, R. G. (2017). Producing health, consuming health
care. In Why are some people healthy and others not? (pp. 27-64).
Routledge.
7

Attachment 1
Process flow chart needed for the new clinic
Attachment 2
Financial report
Expenses
Category Item/Costs Formula Calculation Explanatory Notes
Staffing Dentist 3*150*8*5*52 9,36,000.00$ This cost holds the consultancy
Nurse 4*50*8*5*52 4,24,000.00$
Surgeon 3*100*8*5*52 6,24,000.00$
On costs total cost of staff above x 15% 2,97,600.00$
TOTAL STAFFING Insert total amount here -> 22,81,600.00$
Consumables Surgical Instrument (15*2*20*5*52)*150 23400000
Surgical supplies (15*2*20*5*52)*100 15600000
Medicine (15*2*20*5*52)*50 7800000
others (15*2*20*5*52)*20 3120000
TOTAL CONSUMABLES Insert total amount here -> 4,99,20,000.00$
Utilities Fooding (20*5*30)*50 150000
Hotel Expenditure (20*5*30)*30 90000
Misc. (20*5*30)*20 60000
TOTAL UTILITIES Insert total amount here -> 3,00,000.00$
Administration Management Staff Wages 15000*52 780000
Security and maintance 8007*50 400350
Office Supplies 3000*52 156000
Building Rent 7500*52 390000
TOTAL UTILITIES Insert total amount here -> 17,26,350.00$
Depreciation Depreciation 700000*20% 1,40,000.00$
TOTAL DEPRECIATION Insert total amount here -> 1,40,000.00$
TOTAL COSTS PER YEAR Total of each of the five section totals 5,43,67,950.00$
8
Accountable for planning and accumulating capital
must supervise the operations of the dental centre
Governing
committe
Gives suggestion to the governing body
Takes care of the legislative and financial matters
Advisory
committe
Controls the financial matter
Looks after all the operationsmanagement

Expenses
Category Item/Costs Formula Calculation Explanatory Notes
Staffing dentist 3*150*8*5*52 10,29,600.00$ This cost holds the consultancy
Nurse 8*35*8*5*52 4,66,400.00$
Surgeon 4*100*8*5*52 6,86,400.00$
On costs total cost of staff above x 15% 3,27,360.00$
TOTAL STAFFING Insert total amount here -> 25,09,760.00$
Consumables Surgical Instrument (15*2*40*5*52)*500 2,57,40,000.00$
Surgical supplies (20*20*40*5*52)*100 1,71,60,000.00$
Medicine (2*20*40*5*52)*19 85,80,000.00$
others (5*2*40*5*52)*20 34,32,000.00$
TOTAL CONSUMABLES Insert total amount here -> 5,49,12,000.00$
Utilities Fooding (30*5*30)*50 165000
Hotel Expenditure (30*5*30)*80 99000
Misc. (30*5*30)*52 66000
TOTAL UTILITIES Insert total amount here -> 3,30,000.00$
Administration Management Staff Wages25000*52 858000
Security and maintance 10000*50 440385
Office Supplies 3000*52 171600
Building Rent 7500*52 429000
TOTAL UTILITIES Insert total amount here -> 18,98,985.00$
Depreciation Depreciation 2200000*20% 4,40,000.00$
TOTAL DEPRECIATION Insert total amount here -> 4,40,000.00$
TOTAL COSTS PER YEAR Total of each of the five section totals 6,00,90,745.00$
Income
Category Product/Service Formula Calculation
Income Consultancy 1*35*5*52*75 677950
Surgery 1*20*5*52*350 1820000
Medicine 2*20*7*52*200 51870000
TOTAL INCOME Insert total amount here -> 5,43,67,950.00$
Break Even Calculation
TOTAL INCOME 5,43,67,950.00$
minus TOTAL COSTS PER YEAR 5,43,67,950.00$
Profit / Loss 0
If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.
Income
Category Product/Service Formula Calculation
Income Consultancy 1*35*5*52*84.25 915232.5
Surgery 1*20*5*52*437.5 3185000
Medicine 2*20*7*52*220 62762700
TOTAL INCOME Insert total amount here -> 6,68,62,932.50$
Break Even Calculation
TOTAL INCOME 6,68,62,932.50$
minus TOTAL COSTS PER YEAR 6,00,90,745.00$
Profit / Loss 6772187.5
If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.
9

Income
Calculation Explanatory Notes Category Product/Service Formula Calculation Explanatory Notes
$ 343,200.00 Income Acupuncture 4x4x5x52x90 $ 374,400.00
$ 166,400.00 Taping 4 x 4 x 5 x 52 x 80 $ 332,800.00
$ 124,800.00 Deep Massage 6 x 5 x 5 x 52 x 45 $ 351,000.00
$ 95,160.00 TOTAL INCOME Insert total amount here -> $ 1,058,200.00
$ 729,560.00
$ 12,480.00 Break Even Calculation
$ 6,240.00 TOTAL INCOME $ 1,058,200.00
$ 6,240.00 minus TOTAL COSTS PER YEAR $ 1,058,200.00
$ 7,800.00 Profit / Loss ($) 0
$ 32,760.00
$ 26,520.00 If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.
$ 10,660.00
$ 15,860.00
$ 53,040.00
$ 15,600.00
$ 20,800.00
$ 10,400.00
$ 156,000.00
$ 202,800.00
$ 40,040.00
Income
ORIGINAL VALUES Adjusted values as per the -10% Category Product/Service Formula
$ 343,200.00 $ 308,880.00 Income Acupuncture 4x4x5x52x90
$ 166,400.00 $ 149,760.00 Taping 4 x 4 x 5 x 52 x 80
$ 124,800.00 $ 112,320.00 Deep Massage 6 x 5 x 5 x 52 x 45
$ 95,160.00 $ 85,644.00 TOTAL INCOME Insert total amount here ->
$ 729,560.00 $ 656,604.00
$ 11,232.00 $ 10,108.80 Break Even Calculation
$ 5,616.00 $ 5,054.40 TOTAL INCOME
10