Bluegrass Community Hospital (BCH) has the following payer groups: Number of Admissions Average Revenue per Admission Variable Cost per Admission Commercial 1,000 $5,000 $3,000 BCBS 4,000 $4,500 $4,000 Medicare 8,000 $7,000 $2,500 Given: BCH annual fixed costs are $38M What is BCH’s net income? If half of the 100,000 covered lives in the Commercial group moved to a capitated rate and utilization and cost data remained the same, what PMPM rate should be charged to maintain the Commercial group net income share? What would BCH net income be if the Commercial capitated group admissions decreased by 10%? What would BCH net income be if the Commercial capitated group admissions decreased by 10% and variable costs for the Commercial capitated group decreased to $2,200?
Bluegrass Community Hospital (BCH) has the following payer groups: Number of Admissions Average Revenue per Admission Variable Cost per Admission Commercial 1,000 $5,000 $3,000 BCBS 4,000 $4,500 $4,000 Medicare 8,000 $7,000 $2,500 Given: BCH annual fixed costs are $38M What is BCH’s net income? If half of the 100,000 covered lives in the Commercial group moved to a capitated rate and utilization and cost data remained the same, what PMPM rate should be charged to maintain the Commercial group net income share? What would BCH net income be if the Commercial capitated group admissions decreased by 10%? What would BCH net income be if the Commercial capitated group admissions decreased by 10% and variable costs for the Commercial capitated group decreased to $2,200?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Bluegrass Community Hospital (BCH) has the following payer groups:
|
Number of Admissions |
Average Revenue per Admission |
Variable Cost per Admission |
|
|
Commercial |
1,000 |
$5,000 |
$3,000 |
|
BCBS |
4,000 |
$4,500 |
$4,000 |
|
Medicare |
8,000 |
$7,000 |
$2,500 |
Given: BCH annual fixed costs are $38M
- What is BCH’s net income?
- If half of the 100,000 covered lives in the Commercial group moved to a capitated rate and utilization and cost data remained the same, what PMPM rate should be charged to maintain the Commercial group net income share?
- What would BCH net income be if the Commercial capitated group admissions decreased by 10%?
- What would BCH net income be if the Commercial capitated group admissions decreased by 10% and variable costs for the Commercial capitated group decreased to $2,200?
Expert Solution
Step 1
As per our policy,we are able to answer only first 3 parts of the question.Please re-submit your remaining part of the question to get it solved.
Total revenue = (1000*5000)+(4000*4500)+(8000*7000) =$ 79,000,000
Total varibale cost = (1000*3000)+(4000*4000)+(8000*2500) =$ 39,000,000
Total fixed cost =$ 38,000,000
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education