Explain how many office visits must ppomt deliver to break

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Reference no: EM1360470

PPO of Millbridge Township (PPOMT) sells health benefit plans to local employers. The organization charges its clients (local employers) $50 for each office visit provided to a covered employee. PPOMT contracts with individual physicians to provide the office visits to its health plan beneficiaries. The organization pays its contracted physicians a fee of $40 for each new patient visit and $30 for each follow-up visit. 20% of all office visits are new patient visits. PPOMT maintains an office building where all routine office visits are conducted. The organization pays $6000 in occupancy expenses each month for the building. PPOMT also insures monthly staffing costs of $12,000 for maintenance and administrative staff at its facility.

1. How many office visits must PPOMT deliver to break even?

2. Assuming that PPOMT's facility is open 21 days in a typical month, how much profit will it earn if each of its five contracted physicians sees an average of 12 patients each day?

Reference no: EM1360470

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