Assume that Valley Forge Hospital has only the following three payer groups: Payer Number of admission...

Assume that Valley Forge Hospital has only the following three payer groups:

Payer Number of admission Average Revenue per Admission Variable Cost per Admission

PennCare 1,000 5,000 3,000

Medicare 4,000 4,500 4,000

Commercial 8,000 7,000 2,500

The hospitals fixed costs are $38 million

a. What is the hospital's net income?

b. Assume that half of the 100,000 covered lives in the commercial payer group will be moved into a capitated plan. All utilizations and cost data remain the same. What PMPM rate will the hospital have to charge to retain its Part a net income?

c. What overall net income would be produced if the admission rate of the capitated group were reduced from the commercial level by 10 percent?

d. Assuming that the utilization reduction also occurs, what overall net income would be produced if the variable cost per admission for the capitated group were lowered to $2,200?

Expert Solution

please see images for answers

jeff jeffy answered 1 week ago

Cure All Hospital has received a number of payer denials for services billed with incorrect CPT...

Cure All Hospital has received a number of payer denials for services billed with incorrect CPT codes and revenue codes. After investigating, Jane discovered that several departments were submitting their charges using electronic source systems or paper charge tickets that had not been updated to match the billing system’s charge master. Discuss what Jane should do to correct this problem and measures that should be put in place to ensure that the CDM is correct and that electronic source...

The number of patients needing admission each day to a hospital intensive care unit (ICU) has...

The number of patients needing admission each day to a hospital intensive care unit (ICU) has a Poisson distribution with a mean of 5.3. (a) Why might it be reasonable to expect that daily numbers of patients would have a Poisson distribution rather than any other distribution? (b) Assuming that patients only stay in the ICU for one day, what is the probability that an 8-bedded ICU will have to turn patients away on any particular day? (c) How many...

An admission office at a university is processing freshman applications which fall into three groups: in-state,...

An admission office at a university is processing freshman applications which fall into three groups: in-state, out-of-state, and international. The male–female ratios for in-state and out-ofstate applicants are 1:1 and 3:2, respectively. For international students, the corresponding ratio is 8:1. The ACT score is an important factor in accepting new students. The statistics gathered by the university indicate that the average ACT scores for in-state, out-of-state, and international students are 27, 26, and 23, respectively. The admission committee has established...

The mean number of daily surgeries at a local hospital is 6.2. Assume that surgeries are...

The mean number of daily surgeries at a local hospital is 6.2. Assume that surgeries are random, independent events. (a) The count of daily surgeries follows approximately: A Poisson distribution with mean 6.2 and standard deviation 2.49. A binomial distribution with mean 6.2 and standard deviation 3.8. A binomial distribution with mean 6.2 and standard deviation 1.76. A Poisson distribution with mean 6.2 and standard deviation 6.2. A binomial distribution with mean 6.2 and standard deviation 3.1. (b) The probability...

Assume that a researcher is intending to compare the means of three different treatment groups. The...

Assume that a researcher is intending to compare the means of three different treatment groups. The researcher is concerned about the fact that multiple comparisons will be made during the analysis phase. A) What is the probability that the researcher will reject at least one true hypothesis in his study? B) Assume the researcher is going to compare the means of four different treatment groups. What is the probability that the researcher will reject at least one true hypothesis in...

The expected number of births at a rural hospital is one per day. Assume that births...

The expected number of births at a rural hospital is one per day. Assume that births occur independently and at a constant rate. Use R to the draw the pmf of the number of births per day at this hospital. Find the probability of observing at least 3 births in a day. Find the probability of observing at most 5 births in a week. At a larger hospital, the expected number of births per day is 17.4. Assume that births...

Dr. Sam Wise, medical director at San Diego Valley Hospital, has just conducted a meeting in...

Dr. Sam Wise, medical director at San Diego Valley Hospital, has just conducted a meeting in which he informed those in attendance of an acute outbreak of Zika virus. In the past 36 hours, two men and one woman, completely unrelated to one another, have presented to Valley’s ER with the symptoms of Zika virus. Their only commonality is that they all live within an area of 17 square miles. Patient 1, Stevie, is a 24-year-old graduate student at San...

A hospital has a large number of registered physicians, and keeps the following personal data: physician...

A hospital has a large number of registered physicians, and keeps the following personal data: physician name, date of birth, work ID and specialty. Patients are admitted to the hospital by physicians. Patient’s name and address as well as date of birth are collected. Any patient who is admitted must have exactly one admitting physician. A physician may optionally admit any number of patients. Once admitted, a given patient must be treated by at least one physician. A particular physician...

Searching for Primes Recall that a prime number is divisible only by itself and one. Assume...

Searching for Primes Recall that a prime number is divisible only by itself and one. Assume that we are given a list of all the prime numbers from 1 to 10,000, in sorted order in a text file called primes.txt: 2, 3, 5, 7, 11, 13, 17, 19, 23, 29, 31, 37, 41, 43, 47, 53, 59, 61, 67, 71, 73, 79, 83, 89, 97, 101, 103, 107, 109, 113, 127, 131, 137, 139, 149, 151, 157, 163, 167, 173,...

High-Low Method, Scatterplot, Regression Weber Valley Regional Hospital has collected data on all of its activities...

High-Low Method, Scatterplot, Regression Weber Valley Regional Hospital has collected data on all of its activities for the past 16 months. Data for cardiac nursing care follow: Y Cost X Hours of Nursing Care May Year 1 $59,600 1,400 June Year 1 57,150 1,350 July Year 1 61,110 1,460 August Year 1 65,800 1,600 September Year 1 69,500 1,700 October Year 1 64,250 1,550 November Year 1 52,000 1,200 December Year 1 66,000 1,600 January Year 2 83,000 1,800 February...

Question