The business plan will differ depending on the funding model (fee for service, alternative funding plans, health networks, etc.). The following are some things to consider in terms of revenue and expenses:
Revenue sources
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Provincial health insurance programs: Increasing the number of patient visits or roster size through improved capacity and access can bring in more revenue. In many provinces, as long as the physician interacts with the patient, the visit can be billed. Indeed in some provinces, procedures such as cervical screening, immunizations and injections can also be billed without an interaction with the physician. The average fee-for-service bill for an office visit is $30; a physician-RN team should be able to easily accommodate two additional patients per hour, thus increasing revenue by $60 and covering the RN’s compensation.
Where deliverables or outcome targets (such as P4P) affect revenue, the ability to provide more care to more patients may provide a higher compensation range.
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Non-insurable services: Certain services could increase in a team practice due to increased capacity. This will increase revenue. These services include medicals, form completion, travel immunizations and other procedures that are not covered under provincial insurance plans. In some practices, this added revenue will come from directly billing the patients for these services.
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Research revenue: A physician-RN team may have more capacity to become involved in research programs, resulting in an increase in revenue.
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Enhancements in care: Depending on the funding arrangements, an increase in screening (e.g., cervical screening) and immunization (e.g. tetanus, flu, pneumonia vaccines) will not only improve patient care, but add revenue for the practice
Expenses
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Nursing salary: The average mid-level Canadian salary for nurses is $30.00-$40.00 per hour. Being an RN is very challenging, requiring experience and advanced knowledge. In order to recruit and retain the best RNs, a competitive salary may be an important consideration.
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Benefits: Many primary care practices do not offer employee benefits. Physicians in such practices should consider topping up base salaries to compensate for this (typically an additional 15-25 per cent).In practices where some or all of these benefits are available, the cost of providing these benefits (employer contributions) would be a consideration.
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Overhead: Additional office costs will undoubtedly be incurred as a physician-RN team treats more clients. These extra costs should be a consideration in a primary care practice. Typical overhead costs include office support salaries, medical supplies and facility costs (electricity, maintenance, phones, electronic medical records, etc.).
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Equipment: More equipment may be necessary as an RN adds to the number and diversity of patients that are treated in a physician-RN primary care practice. One-time equipment expenses at the time an RN is added may include: stethoscope, blood pressure cuffs (different sized cuffs), otoscope, thermometer, baby scale, adult scale, steadiometer (height measurement), exam table, exam light, computer, printer, software and licence and office furniture.
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Space rental: Additional space may be necessary to accommodate the registered nurse, which would be an additional cost. Link to section 1.4
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Payroll expenses: Employer contributions to CPP and EI (if relevant) are usually in the range of 8-12 per cent.
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