WGU (AMT2) Service Line Development – All 4 Tasks
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AMT2 Task1 (Western Governors University)
Building Advantages (A1a)
Cost of Building Construction: $600,000
Radiology Expansion/Second MRI: $3,000,000
Architectural and Organizational Autonomy
According to the information provided, Trinity Hospital (TH) wants an efficient and esthetically beautiful facility. The primary purpose of the building, other than increasing revenue, is to facilitate convenience for hospital patients, staff, and clinicians. The mission of the facility is to provide patients with comfort, convenience, and increased quality of care.
If TH chooses to build a new facility, they will have total control over its layout; this will provide management and clinicians the ability to collaborate with one another and create a layout conducive for an efficient environment vis-à-vis patient care. If TH wants to set themselves from their competition, they could start by providing an easily navigated facility, thus making the hospital experience less arduous.
Option 1: Pay Cash Advantage
Currently, TH has a cash reserve of $25,000,000; if TH wanted, they could purchase the building debt free. This, depending on the management’s point of view, does have its advantages, especially if the landscape of the economy is a buyer’s market. Although, TH would not recoup money via tax savings, they would overall have less liabilities giving them leverage if needing to borrow monies for future projects.
Option 2: Borrow: Tax Savings Advantage
If TH borrowed the money to build the new building, they could potentially save on taxes by writing off interest; albeit, this may appear appropriate, mortgage payments will still surpass any savings on taxes or tax advantage.
Buying Advantages (A1b)