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What is the clinic contribution margin on the contract

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Question - Grandview Clinic has fixed costs of $2 million and an average variable cost rate of $15 per visit. Its sole payer, an HMO, has proposed an annual capitation payment of $150 for each of its 20,000 members. Past experience indicates the population served will average two visits per year. What is the clinic's contribution margin on the contract?

Reference no: EM133043443

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