Negotiating contract for inpatient medical

Negotiating contract for inpatient medical–surgical care

Assignment Help Financial Management

Reference no: EM131829322

Refer to the table below for problems. A hospital and a health plan are negotiating a contract for inpatient medical–surgical care. Calculate the amounts that would complete the table below.

Table: PMPM Rate

Annual Copay

Frequency Unit Frequency Copay Copay Net

Category per 1,000 Cost PMPM per 1,000 Amount PMPM PMPM

Hospital inpatient

Medical surgical 400 $1,000 (P1) 100 $150 (P2) (P3)

Use the information from problems 1 - 3 in solving problems 4 and 5. Assume that you are the hospital administrator and that the health plan has offered you a capitated contract at the PMPM rate that you computed in problem 1. You believe, however, that you can control utilization better than is reflected in the table above. You believe the actual utilization will be 370 per 1,000 persons. The number of covered lives is 25,000. Your cost per case is $1,100. (For purposes of this problem, ignore marginal costs, contribution margins, etc.)

1. What is the hospital’s total revenue from this contract?

2. Would your hospital realize a profit on this contract?

Reference no: EM131829322

Questions Cloud

Compare and contrast the potential root causes of terrorism : Compare and contrast the potential root causes of terrorism. Make a case for what you perceive to be the most significant source of terrorism in the past.

Federal government budget rapidly at the present time : What is the argument against attempting to balance the Federal Government budget rapidly at the present time via either deep cuts in Federal Government

How you think offering the perks assist the organization : issue and share how you feel it is a potentially risky one of which all organizations need to be aware. Use a minimum of one reference from a website

Compute the margin of safety in dollars : Dampf Inc. has provided the following data concerning its only product: Compute the margin of safety in both dollars and as a percentage of sales

Negotiating contract for inpatient medical–surgical care : Refer to the table below for problems. A hospital and a health plan are negotiating a contract for inpatient medical–surgical care.

Data suggest about financial market expectations : What does this data suggest about financial market expectations of 1-year yields, 1 year from now? Explain.... (Assume investors are risk neutral in these

Traditional open market purchases of treasury securities : Explain why the Fed created all these extraordinary direct lending facilities instead of simply relying on traditional open market purchases of Treasury securi

Determine the unit sales to attain that target profit : Assume the company's monthly target profit is $16,060. Determine the unit sales to attain that target profit

Determine the purpose of the feedback loop design : Determine the purpose of the feedback loop design and argue how it strengthens or weakens the model. Justify your response.

User Account

All Pages