GP1 Report - Group Number 8 (final)- Checked

Q.What factors, other than cost, do you think Crosstown Health Center should consider in allocating resources to its programs?

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PRINCIPLE OF HEALTHCARE FINANCE

1. What are the four elements of financial management? 2. Briefly explain The Information Flow.  3. How can social media help a hospital manage the patient experience? 4. Briefly explain the difference between short-term and long-term assets. 5. What are the major differences in Government Sourcesand Managed Care Source? 6. Explain the two types of disbursements for services. 7. What is the difference between direct and indirect costs? Explain.

ABC, Resource Drivers, Service Industry Glencoe Medical Clinic operates a cardiology care unit and a maternity care unit. Colby Hep worth, the clinic’s administrator, is investigating the charges assigned to cardiology patients. Currently, all cardiology patients are charged the same rate per patient day for daily care services. Daily care services are broadly defined as occupancy, feeding, and nursing care. A recent study, however, revealed several interesting outcomes. First, the demands patients place on daily care services vary with the severity of the case being treated. Second, the occupancy activity is a combination of two activities: lodging and use of monitoring equipment. Since some patientsrequire more monitoring than others, these activities should be separated. Third, the daily rateshould reflect the difference in demands resulting from differences in patient type. Separating theoccupancy activity into two separate activities also required the determination of the cost of…

1. Briefly explain The Information Flow.  2. How can social media help a hospital manage the patient experience? 3. Briefly explain the difference between short-term and long-term assets. 4. What are the major differences in Government Sourcesand Managed Care Source? 5. Explain the two types of disbursements for services. 6. What is the difference between direct and indirect costs? Explain.

ABC, Resource Drivers, Service Industry Glencoe Medical Clinic operates a cardiology care unit and a maternity care unit. Colby Hepworth, the clinic’s administrator, is investigating the charges assigned to cardiology patients. Currently, all cardiology patients are charged the same rate per patient day for daily care services. Daily care services are broadly defined as occupancy, feeding, and nursing care. A recent study, however, revealed several interesting outcomes. First, the demands patients place on daily care services vary with the severity of the case being treated. Second, the occupancy activity is a combination of two activities: lodging and use of monitoring equipment. Since some patients require more monitoring than others, these activities should be separated. Third, the daily rate should reflect the difference in demands resulting from differences in patient type. Separating the occupancy activity into two separate activities also required the determination of the cost…

Question 14 Hermes Hospitals Group (HHG) provides a private hospital medical services to private clients and company employees who are members of their insurance scheme. Service Heads coordinate and organize the medical services provided using Medical Consultants and their own theatre staff and nurses. Each medical procedure or service has a standard price and costs are carefully controlled by benchmarking against the NHS using industrial intelligence. A further 10% in costs is allowed based on the goal to improve the customer's experience by providing more nursing and consumables such as towels, slippers and other comforts. Customers (patients) are given a risk assessment and the medical procedure or service is undertaken on a fixed price basis, subject to major alterations in the service provided. e HHG prides itself in providing a reliable, high quality service using the latest medical techniques and highly competent Consultant surgeons. Longer term, HHG would like to have a full…

Regression; choosing among models. Apollo Hospital specializes in outpatient surgeries for relatively minor procedures. Apollo is a nonprofit institution and places great emphasis on controlling costs in order to provide services to the community in an efficient manner. Apollo’s CFO, Julie Chen, has been concerned of late about the hospital’s consumption of medical supplies. To better understand the behavior of this cost, Julie consults with Rhett Bratt, the person responsible for Apollo’s cost system. After some discussion, Julie and Rhett conclude that there are two potential cost drivers for the hospital’s medical supplies costs. The first driver is the total number of procedures performed. The second is the number of patient-hours generated by Apollo. Julie and Rhett view the latter as a potentially better cost driver because the hospital does perform a variety of procedures, some more complex than others. Rhett provides the following data relating to the past year to Julie.…

A hospital services provider whose payer/payment mix is 95% fee for service can effectively reduce its financial risk by reducing its variable costs of production. True False

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A1

OBJECTIVE 2456 sout cost behavior that you would like to have? Explain. Problem 3-28 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 x Cost Hours of Nursing Care May 2010 $59,600 1,400 June 2010 57,150 1,350 July 2010 61,110 1,460 August 2010 65,800 1,600 (continued) Chapter 3 Cost Behavior Y Cost x Hours of Nursing Care September 2010 69,500 1,700 October 2010 64,250 1,550 November 2010 52,000 1,200 December 2010 66,000 1,600 January 2011 83,000 1,800 February 2011 66,550 1,330 March 2011 79,500 1,700 April 2011 76,000 1,600 May 2011 June 2011 68,500 1,400 73,150 1,550 July 2011 August 2011 73,175 1,505 66,150 1,290 Required: 1. Using the high-low method, calculate the variable rate per hour and the fixed cost for the nursing care activity. 125

Create a cross volume profit chart. Select an item or product used in an healthcare organization and describe how you would calculate the break - even point. Describe why this break - even information is useful.

W4  Private health insurance In the US, about 2/3 of individuals are covered by private health insurance, and most of the private insurance is provided through the large firms. Usually in this big firms, workers are offered with the same kind of health insurance. People pay for health insurance through reduced wages. Discuss the potential redistribution effects (progressive or regressive?) and efficiency effects of this system.

Q.What benefits can Crosstown Health Center obtain by implementing the ABC system?

Assume that Valley Forge Hospital has only the following three payer groups: Payer Number of Average Revenue Cost Admissions Admission PennCare $3,000 Medicare $4,000 Commercial $2,500 1,000 4,000 8,000 per Admission $5,000 $4,500 $7,000 Variable per The hospital's fixed costs are $38 million. a. Using the profit/loss format from our textbook and PowerPoints in this module, determine the hospital's net income, therefore showing your work to demonstrate how you got to the net income answer. b. Assume that half of the 100,000 covered lives in the commercial payer group (above) will be moved into a capitated plan. All utilization and cost data remain the same. What PMPM rate will the hospital have to charge to retain its Part A net income (what you calculated above)?

Which of he following stalements BEST describes the primary difference between a Health Maintenance Organizalion (HMO) and a Preferred Provider Organization (PPO)? A.Under a PPO lhe insured may use any medical provider whereas providers are restricted with HMOs. B.Under an tvo the deductibles are higher than are those of PPOs. C.POs do not provide preventive care benefits whereas HMOs do D.HMOs utilize larger cost sharing than do PPOs

6.2 Refer to Problem 6.1. Assume that the three patient services departments are adult services, pediatric services, and other services. The patient services revenue and hours of housekeeping services for each department are as follows: Department Revenue Housekeeping Hours Adult Services $3,000,000 1,500 Pediatric Services 1,500,000 3,000 Other Services 500,000 Total $5,000,000 500 5,000 a. What is the dollar allocation to each patient services department if patient services revenue is used as the cost driver? b. What is the dollar allocation to each patient services department if hours of housekeeping support is used as the cost driver? c. What is the difference in the allocation to each department. between the two drivers? d. Which of the two drivers is better? Why?

CHAPTER 17: FINANCIAL CONDITION ANALYSIS Homework Problem 5.2 Healthy Medical Center OPERATING DATA Net inpatient revenue Net outpatient revenue Net patient service revenue Inpatient operating expenses Total salaries Total discharges Inpatient days # licensed and staffed beds Total FTES Inpatient FTES OPERATING INDICATOR ANALYSIS Calculate the following ratios based upon the data above Profit per Discharge Net Price per Discharge Outpatient Revenue % Occupancy Rate Average Length of Stay Inpatient FTES per Occupied Bed $40,902,330 $26,150,670 $67,053,000 $39,675,260 $18,964,670 Salary per FTE 7,498 34,491 163 496 292 Healthy Medical Center Industry Average $73 $5,965 58.5% 56.6% 4.7 5.6 $33,977 For each ratio, provide a brief ratio analysis and comparative analysis. Indicator Analysis: Briefly explain what the indicator means Comparative Analysis Indicator Analysis Comparative Analysis Indicator Analysis Comparative Analysis Indicator Analysis Comparative Analysis Indicator Analysis…

What is the degree of operating leverage?