NR 510 Week 3 Organizational Behavior and Business Influences and Advanced Practice Nursing Case Study Part Two
University:
Chamberlain University
NR 510 Week 3 Organizational Behavior and Business Influences and Advanced Practice Nursing Case Study Part Two
Paper Instructions
As revenue generators, NPs must be aware of how their work contributes to the overall revenue of the clinical practice. You see 20 patients per day on average and take call every third weekend. According to Buppert (2011), an NP who sees 15 patients per day at $56 per patient visit, on average, brings in $840 per day. Allowing 1 week off for continuing education, 1 week off for illness, and 4 weeks off for vacation, this NP will bring in $193,200 a year, potentially.
However, not all bills are paid. With a 90% collection rate—a reasonable collection rate for an efficient practice—this NP actually will bring in $173,880 per year. An NP who sees 24 patients per day will bring in $1344 per day, or $309,120 per year in accounts receivable. With a 90% collection rate, this NP will bring $278,208 to the practice (Buppert, 2011).
Establishing a salary can be a challenge for NPs. Deducting 40% of the NP’s gross generated income for overhead expenses (rent, benefits, continuing education, supplies, malpractice, lab expenses, and depreciation of equipment) leaves $104,280 for the 15-patient-per-day NP and $166,925 for the 24-patient-per-day NP. Further deducting 15% of that figure to pay a physician for consultation services leaves $88,638 in salary for the 15-patient-per-day NP and $141,887 in salary for the 24-patient-per-day NP.
Deducting 10% for employer profit leaves $79,775 in salary for the 15-patient-per-day NP and $127,699 for the 24-patient-per-day NP (Buppert, 2011).
What salary would you propose for the contract renewal? How does your salary proposal fit in with the community standard for an NP in a similar practice? Use logical reasoning, and provide evidence based rationales for your decisions. Keep in mind that your negotiation terms and conditions must be within the legal scope of practice for an ANP.
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Sample Answer
According to salary.com the average US NP makes approximately $116,000 per year. The same site states that the average salary in my area is between $108,000 and $126,000 per year. Danielsen, Potenza, and Onieal (2016) suggest that you should not think that the salary of the position you are pursuing has a predetermined rate. Considering a previous rate of approximately 20 patients a day and a projected rate of 24 patients a day, a salary of $117,000 would be appropriate.
Using Buppert’s equation, seeing 20 patients a day would produce an approximate salary of $106,000 and seeing 24 patients would produce an approximate salary of $128,000. If you take both salaries and average them it is approximately $117,000, a fair rate in the current market of NPs. This also leaves room for negotiation for the next contract when goals are met.
Considering this position is a contract position, I would not hesitate to ask for a bonus based on performance, collection rates, and revenues. Independent contractors typically provide for their own medical insurance, malpractice insurance, and continuing education costs, this is a substantial savings to the practice. In New Jersey the cost of a family health care plan can cost an employer more than $20,00 yearly, while malpractice insurance costs approximately $2000 a year for a family practitioner (NSO.com).
Jessica.
Resources
- Danielsen, R., Potenza, A. & Onieal, M. (2016). Negotiating the professional contract. Clinician Reviews, 28-33.
- Decapua, M. (2016). How much revenue does a primary care nurse practitioner generate? Retrieved from https //www.bartonassociates.com/blog/how-much-revenue-does-a-primary-care-nurse-practitioner-generate/
- Nurses Services Organization. (2018). Quick Quote for Individual Professional Liability Insurance. Retrieved from https //forms.nso.com/mustela/site?productName=HCI#/QuickQuoteDetails.
- Salary.com. Nurse practitioner salaries in Toms River, NJ. Retrieved from https //www1.salary.com/NJ/Toms-River/Nurse-Practitioner-salary.html
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