The financial component of this business plan's objective is to provide an estimate of the implementation cost and expenses over a three-year timeframe. This section will explain the financing source, the cost of deploying the EMR in the hospital and the four clinics, and the maintenance costs over a three-year period. A 200-bed hospital employs around 450 part-time and 1000 full-time employees. Typical yearly hospitalizations vary from 8,000 to 11,000, inpatient surgeries are around 2000, outpatient volume is around 5000, and 40,000 outpatient visits are made each year. As a result, the system must be effective and efficient in order to lower operating costs while improving care quality. The table below describes the costs that the hospital will incur to implement and run the system. The first table indicates upfront costs and the second one shows recurring costs on an annual basis.
5.1 Pre-Installation Costs
This section focuses on the costs the healthcare facility needs to pay upfront in order to acquire and implement the system.
Item
Amount (US Dollars)
Hardware
44,000
EMR Software (Certified Vendor)
60,000
Implementation assistance costs
10,000
Employee training
8,000
Total Costs
$122,000
The hospital will spend $122,000 to implement the system within the facility and the clinics.
The table below indicates the recurring expenditure that the healthcare organization will incur on an annual basis. Since the hospital chose to implement an on-site as a Service system and not the Web-based software as a Service system, which requires monthly subscriptions, the costs will be lower.
Item
Yearly Amount (US Dollars)
Salaries (3 ICT Staff)
57,000
Employee training (after upgrades and refresher)
2,000
Ongoing maintenance fees
3,000
Total Costs
62,000
Besides the cash reserves, the hospital will need external funding to implement the system as described in the table below. However, the facility will bear the costs for maintenance and upgrades.
5.2 Desired Financing
Item
Amount (Dollars)
Hospital Reserves
43,000
Donors and Well-wishers
37,800
Federal Financial Support
38,000
Total Desired Financing
118,800
The hospital will obtain financial resources from well-wishers, the state government and cash reserves. All these will amount to $118,800 for the EMR to be implemented successfully.
5.3 Estimated Cost of System Maintenance for a Three-Year Period
Item
FY1 ($)
FY2 ($)
FY3 ($)
Consultation fees
800
500
613
Utilities
300
313
324
Copying fees
134
153
147
Paper
113
97
93
Permits
267
289
276
Security systems
89
91
88
Costs of data storage
310
324
347
Total Expense
2,013
1,767
1,888
The expenses indicated above are averagely $1890. The costs will keep decreasing for the near future while the quality of care will improve.
5.3 The Total Costs for Implementing the System in the First Year of Operation
Item
Amount (Dollars)
Upfront Installation costs
122,000
Recurring costs
62,000
System maintenance
2,013
Total Costs for Year 1
$186,013
Therefore, the hospital will need at least $186,013 to implement and run the system in Year 1.