1. Cost Analysis Examples Presented January 8 th, 2014

2. 1)Admin Fee - Flu 2)Admin Fee – Non-Flu 3)Vaccine - Zostavax Examples to be reviewed:

5. Employee Salaries & Fringe Percentages Time Studies: 1)Time to process one flu vaccination 2)Time spent scheduling, preparing charts, form prep etc. 3)Time to Administer Vaccine -RN Time Estimated Cost of Supplies for 1 Shot Facility Costs: Rent Utilities Telephone Janitorial Costs Computer Maintenance Costs EMR Annual Fees Computer Software Annual Fees # of Vaccines Given – Broken down by vaccination

7. The example to follow is for: Administration Fee for the Flu Vaccine For the Period of Oct 1 – March 31, 2012 Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013

8. % Of Net Revenues: Our Example: 3.6 hrs. spent on flu per day (Time Study estimated hours) / 21.60 hrs.. available per day ( 3 staff = 2 @ 8hrs per day and 1 @ 5.6hrs per day) equals the 16.7% % of claims denied/never paid: Our example: Based on % of Insurance Collections And assuming Private Pay is 100% Collectible – we looked at what all insurance companies were billed versus the dollars we received.

9. NUMBER OF VACCINES GIVEN Section B Total number of all vaccines administered during the period (e.g. CPT 90471, 90473, G0008)3,375 Our Example: Admin Code: 90471 & 90473 = 2629 (Injectable Admin and Mist Admin) Admin Code: G0008 = 746 ( Medicare B Admin ) Flu Only

10. COST OF ADMINISTRATION Section C Time Study: the amount of time in minutes it takes to process one administration of vaccine from the time a client walks in the door to the time the client leaves. 7 For appointments for administration of vaccines only (i.e. no doctor visit): number of hours spent by staff scheduling appointments, preparing charts, and checking in and out during the period394 Average hourly wage of staff making appointments, etc. $ 13.94 Average fringe benefit percentage45.00% PERSONNEL COSTS FOR SCHEDULING, ETC. $ 7,958.87 Our Example: Time is based on the vaccinations given at a flu clinic = 7/min per client For Appts = Total # Flu = 3375 * 7 minutes / divide that by 60 minutes = 394 hrs.. Average Wage/Fringe = the average wage is for 3 front desk staff and The fringe is the overall average % for the facility Rows in gray will automatically calculate. You do not need to fill these in.

11. Hours spent over the period entering vaccines into the registry (THOR). 56.3 Average hourly salary of all staff entering vaccines into the registry (THOR). $ 13.94 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR ENTERING DATA INTO REGISTRY$ 1,136.98 Our Example: Hours Spent = 1 min per claim * 3375 claims / 60 min = 56.3 hrs.. Personnel Costs = # hrs.. 56.3 * (Average salary + fringe) = $1136.98 Estimated Flu @ 1 min per claim Average Front Desk Staff Salary/Fringe from Prior Section Calculated Field Rows in gray will automatically calculate. You do not need to fill these in.

12. Number of hours staff spend on triage calls related to vaccines during the period3.94 Average hourly wage of staff answering vaccine related triage calls $ 26.58 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR VACCINE TRIAGE CALLS $ 151.76 Estimated @ 1% of Time for Appts =394 hrs. From the first part of Section C Average of RN Wages & Overall Facility Fringe Our Example: Hours Spent = 1%* 394 hrs. = 3.94 hrs. Personnel Costs = 3.94hrs * Salary + Fringe = $151.76 Calculated Field Rows in gray will automatically calculate. You do not need to fill these in.

13. Staff time (in minutes) administering vaccine (include distribution of VIS, answering questions, drawing up vaccine, administering the injection, and documenting it). Assume this is a single antigen vaccine.16875.0 Additional staff time (in minutes), per antigen, for multiple-antigen vaccines.0.0 Average hourly salary of staff administering vaccine $ 26.58 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR ADMINISTERING VACCINE - INITIAL ANTIGEN $ 10,839.66 Estimated 5 min/Client * Total Flu Vaccines of 3375 N/A for Flu Average of RN Wages & Overall Facility Fringe Our Example: Staff Time = 5 minutes * 3375 Flu Vaccinations = 16,875 minutes Personnel Costs = 16,875 min/60 = 281.25 hrs. * Salary + Fringe = $10,839.66 Calculated Field Rows in gray will automatically calculate. You do not need to fill these in.

14. Section D Estimated cost of supplies per shot0.29 Total cost of medical supplies$978.75 Cost of sharps containers used in the period $ 48.00 Percentage of sharps used in office that are vaccine-related100% Cost of disposal total service annually $ 157.00 Percentage of disposal service for the period92.00% TOTAL SUPPLIES AND SHARPS DISPOSAL $ 1,171.19 Our Example: Cost of Supplies = Gloves 1 box of 100 @ $4.52 = $4.52/100 X 2 = $0.09 Syringes 1 box of 100 @ $15.71/100 = $0.16Cotton Ball = $.01 Band-Aids 1 box of 100 @ 2.45/100 = $0.02Alcohol Swab = $.01 Cost of Sharps Container = Estimated 250 needles per container 3375/250 = 13.5 containers just for flu shots * $3.56 per container * 100% usage = $48 Cost of Disposal = $157 * 92 % = $144.44 Calculated Field = Total # Shots 3375 * 29 cents Annual Facility Disposal Cost Flu = 92% of all vaccinations given during this reporting time period $3.56 * 13.5 containers * 100% usage Calculated Field - Total Supply Cost = $978.75 + $48.00 + $144.44 ($157*92%) = $1171.19 COST OF ADMINISTRATION Rows in gray will automatically calculate. You do not need to fill these in.

15. Total rent/utilities/janitorial and telephone during the reporting period$17,786.62 Estimated percentage of rent and utilities attributable to vaccine-related appointments45.00% TOTAL RENT AND UTILITIES$8,003.98 COST OF ADMINISTRATION Section D 6 Months of the annual Exp’s allocated to Public Health Services only – not FP, BT, Tobacco,etc. Flu (admin + vaccine) is 45% of all revenue generated by Public Health Services only – do not include FP. Our Example: 6 Months of the following expenses: Rent = 9494.36 Janitorial = 3092.71 Telephone = 1715.81 Utilities = 3483.74 Total = $17,786.62 * 45% = $8,003.98 Rows in gray will automatically calculate. You do not need to fill these in.

16. Total computer/EMR costs during the period i.e.: Ahlers Annual Fee +Comp Maintenances + Other Software Maintenance Fees $ 8,791.13 Percent of computer/EMR costs attributable to vaccines + admin45.00% TOTAL COMPUTER/EMR COSTS $ 3,956.01 COST OF ADMINISTRATION Section D 6 Months of the annual Exp’s allocated to Public Health Services only – not FP, BT, Tobacco,etc. Flu (admin + vaccine) is 45% of all revenue generated by Public Health Services only – do not include FP. Our Example: Annual costs of the following expenses: Ahlers = $1,120.00 Centricity = $4,200.00 Computer Maintenance = $12,262.25 = Total $17,582.25 Total = $17,582.25 * 50%(6 months) = $8,791.13 * 45% = $3,956.01 Rows in gray will automatically calculate. You do not need to fill these in.

17. COST OF ADMINISTRATION Section D Section E TOTAL PROFESSIONAL LIABILITY INSURANCE Suggested at $0.37/Vaccination ***see note below $ 1,248.75 BILLING/COLLECTIONS COST - INITIAL ANTIGEN $ 14,056.81 TOTAL ADMINISTRATION EXPENSES - INITIAL ANTIGEN $ 50,752.01 Administration Cost Per Flu Shot $ 15.04 Current BCBS reimbursement rate for first administration $ 24.94 Liability Insurance calculation is taken directly from the original worksheet – we felt it was a fair calculation **NOTE: Professional liability insurance is calculated using the Medicare non-geographically adjusted standard of 0.01 professional liability insurance (PLI) relative value units (RVUs). The PLI RVUs were then multiplied by the 2010 Medicare conversion factor ($36.8729) to obtain the estimated professional liability insurance cost of $0.37 per vaccine administered. $0.37 * 3375 total Vaccinations Our Example: Billing Collection Costs = 16.7% Percentage of Net Revenue used by Billing Collection Staff * Current BCBC reimbursement Rate of $24.94 ( the assumption being the revenue is equal to the current reimbursement rate) * Total Vaccinations 3375 = Totals $14,056.81 Total Admin Costs = Personnel Costs for Scheduling + Personnel Costs for Data Entry + Personnel Costs for Triage + Personnel Costs for Administering Vaccine + Supply Costs + Rent/Utilities + Computer/EMR Costs + Liability Insurance Costs + Billing/Collection Costs Admin Cost per Flu Shot = $50,752.01(Total Admin Exp’s) / 3375 ( Total # of Flu shots given) $15.04 = Total Admin Expenses / # flu shots Rows in gray will automatically calculate. You do not need to fill these in.

18. The example to follow is for: Administration Fee for Non-Flu Vaccinations For the Period of Oct 1 – March 31, 2012 Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013

19. % Of Net Revenues: Our Example: 1.04 hrs. spent on non-flu per day (Time Study estimated hours) / 21.60 hrs.. available per day ( 3 staff = 2 @ 8hrs per day and 1 @ 5.6hrs per day) equals the 4.8% % of claims denied/never paid: Our example: Based on % of Insurance Collections And assuming Private Pay is 100% Collectible – we looked at what all insurance companies were billed versus the dollars we received. COSTS RELATED TO ALL COLLECTIONS Section A Percent of NET revenues used by the billing/collections staff, department, or service4.8% Percentage of all claims denied/never paid -4.4% Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013

20. Our Example: Admin Code 1st: 90471 & 90473(Nasal) = 229 Admin Code: G0009 Med B Pneumonia = 3 Admin Code Addt’l: 90472 & 90474(Nasal) = 68 Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Non-Flu Only NUMBER OF VACCINES GIVEN Section B Total number of all vaccines administered during the period (e.g. CPT 90471, 90473, G0009)232 Number of additional antigens administered during the period (e.g. CPT 90472, 90474 )68

21. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 COST OF ADMINISTRATION Section C Time Study: the amount of time in minutes it takes to process one administration of vaccine from the time a client walks in the door to the time the payment is posted whether it is self pay or insurance. 15 For appointments for vaccines only (i.e. no doctor visit): number of hours spent by staff scheduling appointments, preparing charts, and checking in and out during the period 75 Average hourly wage of staff making appointments, etc. $ 13.94 Average fringe benefit percentage45.00% PERSONNEL COSTS FOR SCHEDULING, ETC. $ 1,515.98 Rows in gray will automatically calculate. You do not need to fill these in. Estimated 15 min Per client Our Example: Number of Hours = 300 (# of vaccines given ) * (15 min per client / 60min) Average Wage/Fringe = the average wage is for 3 front desk staff and the fringe is the overall average % for the facility Personnel Costs = 75 hrs * (Salary + Fringe) = $1515.98 # hours * Salary + Fringe

22. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section C Hours spent over the period entering vaccines into the registry (THOR). 6.1 Average hourly salary of all staff entering vaccines into the registry (THOR). $ 13.94 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR ENTERING DATA INTO REGISTRY $ 123.97 Estimated 1 min -1 st antigen and 2 min – 2 nd antigen Our Example: Number of Hours : 1min * 232 (1 st antigen) + 2min * 68 (2 nd antigens) = 368 min/60min = 6.1 hours Average Wage/Fringe = the average wage is for 3 front desk staff and the fringe is the overall average % for the facility Personnel Costs = 6.1 hrs * (Salary + Fringe) = $123.97 # hours * Salary + Fringe

23. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section C Number of hours staff spend on triage calls related to vaccines during the period0.7500 Average hourly wage of staff answering vaccine related triage calls $ 26.58 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR VACCINE TRIAGE CALLS $ 28.91 Estimated at 1% of Time for Appts = 1% x 75 hrs Average Wage/Fringe = the average wage is for nurse time and the fringe is the overall average % for the facility Our Example: Personnel Costs =.75 hrs * (Salary + Fringe) = $28.91 # hours * Salary + Fringe

24. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section C Staff time (in minutes) administering vaccine (include distribution of VIS, answering questions, drawing up vaccine, administering the injection, and documenting it). Assume this is a single antigen vaccine.3480.0 Additional staff time, per antigen, for multiple-antigen vaccines.5.0 Average hourly salary of staff administering vaccine $ 26.58 Average percentage of fringe benefits for the staff described above. 45.00% PERSONNEL COSTS FOR ADMINISTERING VACCINE - INITIAL ANTIGEN $ 2,235.38 PERSONNEL COSTS FOR ADMINISTERING VACCINE - ADDITIONAL ANTIGEN $ 218.40 Estimated 15 min -1 st antigen X 232 Estimated 5 min to administer addt’l antigens Our Example Average Wage/Fringe = the average wage is for nurse time and the fringe is the overall average % for the facility Personnel Costs 1 st Antigen = 3480 min/60 = 58 hrs * (Salary + Fringe) = $2235.38 Personnel Costs 2nd Antigen = (5 min* 68) = 340 min / 60 = 5.67hrs * (Salary + Fringe) = $2235.38

25. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section D Estimated cost of supplies per shot0.29 Total cost of medical supplies$87.00 Cost of sharps containers annually $ 48.00 Percentage of sharps used in office that are vaccine-related100% Cost of disposal service annually $ 157.00 Percentage of disposal service for the period ****8.00% TOTAL SUPPLIES AND SHARPS DISPOSAL $ 103.40 Our Example: Cost of Supplies: Gloves 1 box of 100 @ $4.52 = $4.52/100 X 2 = $0.09 Syringes 1 box of 100 @ $15.71/100 = $0.16Cotton Ball = $.01 Band-Aids 1 box of 100 @ 2.45/100 = $0.02Alcohol Swab = $.01 Cost of Sharps Container: 8% * $48 = $3.84 Cost of Disposal = 8% of $157 = $12.56 Total Supplies = $87 + $3.84 + $12.56 8% = the percentage of Non-Flu admins / total admins given during the time period $87 =.29 * 300 vaccinations ( 232 - 1 st + 68 - 2 nd )

26. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section D Total rent and utilities/janitorial during the period$17,786.62 Estimated percentage of rent and utilities attributable to vaccine-related appointments10.53% TOTAL RENT AND UTILITIES$1,872.93 6 Months of the annual Exp’s allocated to Public Health Services only – not FP, BT, Tobacco,etc. Our Example: 6 Months of the following expenses: Rent = 9494.36 Janitorial = 3092.71 Telephone = 1715.81 Utilities = 3483.74 Total = $17,786.62 Total Rent & Utilities = $17,786.62 * 10.53% = $1,872.93 10.53% = the percentage of Non-Flu revenue

27. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Total computer/EMR costs during the period ie: Ahlers Annual Fee +Comp Maintenances + Other Software Maintenance Fees $ 8,791.13 Percent of computer/EMR costs attributable to vaccines10.53% TOTAL COMPUTER/EMR COSTS $ 925.71 Our Example: Annual costs of the following expenses: Ahlers = $1,120.00 Centricity = $4,200.00 Computer Maintenance = $12,262.25 = Total $17,582.25 Total = $17,582.25 * 50%(6 months) = $8,791.13 * 10.53% = $925.71 6 Months of the annual Exp’s allocated to Public Health Services only – not FP, BT, Tobacco,etc. Section D 10.53% = Non-Flu Revenue / Total Public Services Revenue

28. Non-Flu Administration Cost Calculator Analysis Period: Oct 1, 2012 - Mar 31, 2013 Rows in gray will automatically calculate. You do not need to fill these in. Section E TOTAL PROFESSIONAL LIABILITY INSURANCE Suggested at $0.37/Vaccination $ 111.00 BILLING/COLLECTIONS COST - INITIAL ANTIGEN $ 277.73 BILLING/COLLECTIONS COST - ADDITIONAL ANTIGEN $ 40.11 TOTAL ADMINISTRATION EXPENSES - INITIAL ANTIGEN $ 7,526.15 TOTAL ADMINISTRATION EXPENSES - ADDITIONAL ANTIGEN $ 258.51 Administration Cost Per Non-Flu Shot $ 25.95 Current BCBS reimbursement rate for first administration $ 24.94 Current BCBS reimbursement rate for each additional administration $ 12.29 Liability Insurance calculation is taken directly from the original worksheet – we felt it was a fair calculation **NOTE: Professional liability insurance is calculated using the Medicare non-geographically adjusted standard of 0.01 professional liability insurance (PLI) relative value units (RVUs). The PLI RVUs were then multiplied by the 2010 Medicare conversion factor ($36.8729) to obtain the estimated professional liability insurance cost of $0.37 per vaccine administered. Our Example: Billing Collection Costs = 1 st Antigen - 4.8% Percentage of Net Revenue used by Billing Collection Staff * Current BCBS reimbursement Rate of $24.94 ( the assumption being the revenue is equal to the current reimbursement rate) * Total Vaccinations 232 = Totals $277.73 2nd Antigen - 4.8% Percentage of Net Revenue used by Billing Collection Staff * Current BCBS reimbursement Rate of $12.29 ( the assumption being the revenue is equal to the current reimbursement rate) * Total Vaccinations 68 = Totals $40.11 Total Admin Costs 1 st Antigen = Personnel Costs for Scheduling + Personnel Costs for Data Entry + Personnel Costs for Triage + Personnel Costs for Administering Vaccine 1 st Antigen + Supply Costs + Rent/Utilities + Computer/EMR Costs + Liability Insurance Costs + Billing/Collection Costs 1 st Antigen Total Admin Costs 2nd Antigen = Personnel Costs for Administering Vaccine 1 st Antigen + Billing/Collection Costs 2nd Antigen Admin Cost per Flu Shot = ($7526.15 + $258.51) / 300 (232 - 1 st Antigen + 68 2 nd Antigens)

30. For our example we have chosen ZOSTAVAX For the Period of Jan 1 – Dec 31, 2012

31. Our Example: The purchase price is the actual cost per dose + any taxes for the reporting period– this information will come directly from the invoice provided by your supplier. If the prices changes throughout the reporting period you could use an average of the total costs. Rows in gray will automatically calculate. You do not need to fill these in.

32. Our Example: Estimated 1.0 hr. spent on Zostavax clients per day (Time Study estimated hours) / 21.60 hrs. available per day ( 3 staff = 2 @ 8hrs per day and 1 @ 5.6hrs per day) equals the 4.80% Our example: Based on collections from Medicare D client co- pays and any coinsurances and deductibles from BCBS – this does not include provider discounts. Med D was 57% of our total claims billed and BCBS was 35%.

33. Total # of ALL ( Flu and Non-Flu) Vaccinations given during this period. Total # Zostavax given Our Example: Hours Spent - we used a time study from one front desk staff that is very involved with the vaccine inventory and monitoring. You could use any staff ( including RN’s) that are involved with this process. Rows in gray will automatically calculate. You do not need to fill these in.

34. Purchase price of refrigerator/freezer, alarm/temperature monitoring device, generators in case of power outages $ 17,794.16 Cost of electricity attributable to vaccine storage refrigerator during the period686.44 STORAGE COSTS** $ 0.97 Purchase costs of Vaccine Fridges/Freezers & Generator With in the last 5 years Our Example: Included the purchase costs of 1 Vaccine Fridge, 1 Vaccine Freezer and the cost of a facility generator plus installation – these are depreciated over 5 yrs., then they can be removed from the cost of the vaccine calculator Cost of Electricity – this is an estimate based on the total Zostavax gross revenue divided by the public health total revenue * the annual electric costs i.e.: 8% * Estimated annual electric costs of $8580.00 Rows in gray will automatically calculate. You do not need to fill these in.

35. Annual cost of insurance on vaccine inventory $ 200.00 Total value of current vaccine inventory - All + cost of Universal $ 17,265.00 Number of Doses on hand for the vaccine in question12.00 Total value of inventory of vaccine in question $ 1,880.76 INSURANCE COSTS AGAINST VACCINES ORDERED $ 0.2533 This should be found on your facilities policy The total value of ALL vaccines in your inventory at period end. Include even if they are part of the Universal Coverage Program # of does on hand at the period end. Our Example: 12 Doses of Zostavax on hand * the cost of $156.73 = $1,880.76 Total Value of Inventory: THOR report – or any method you use to track your vaccine inventory Insurance Cost Calculated Field: Annual Insurance Cost- 200.00 * ( Vaccine Value – 1880.76 / Total inventory value – 17265.00 ) * (# Months in example used for the example- 12months / 12) / # doses administered- 86 ) = 25 cents per dose Rows in gray will automatically calculate. You do not need to fill these in.

36. Percentage of doses wasted or for which a bill is never created (i.e. forgotten, etc.)0.0% WASTE/UNBILLED/DENIED $ 1.58 Our Example: % Wasted – it was decided with Zostavax there is not waste unless there would be a fridge outage or something similar. Waste/Unbilled/Denied Cost: Total Direct- 156.73 / (1 – (Wasted %- 0% + % Not Collected- 1% ) - Total Direct- 156.73 = 1.58 Calculated Field Rows in gray will automatically calculate. You do not need to fill these in.

37. Reasonable annual return on investment (enter as a percentage)1.0% Average number of days from vaccine purchase to vaccine administration20 Days of A/R for practice (average days between appointment and payment)26 OPPORTUNITY COST $ 0.20 Our Example: Return on Investment – look at the current market percentages on your investments accounts – savings, checking, CD’s, etc. Average days – estimate the number of days from when the vaccine arrives to When it is administered. Days of A/R – estimated days from the time the vaccine is administered to when It is paid. Use an average since each payor is different Calculated Field Rows in gray will automatically calculate. You do not need to fill these in.

38. BILLING/COLLECTIONS COST $ 9.03 TOTAL OVERHEAD COSTS (in dollars) $ 12.28 TOTAL OVERHEAD COSTS (as a percentage of direct cost)7.8% Total Vaccine Cost + Overhead Costs $ 169.01 BCBS Reimbursement Rate $ 171.27 Med D - using TransActRX - Average Reimbursement $ 171.64 Medical Assistance Reimbursement $ 180.00 Calculated Fields Reimbursement Rates at the time of the analysis Our Example: It costs $169.01 for one dose of Zostavax to be housed In the facility – based on the current reimbursements – estimated profits per dose would be BCBS - $2.26, Medicare Part D - $2.63 and Medical Assistance - $10.99