# analyzing Bay Pines Medical Centers Financial Statement

Jun 8th, 2015
KateS
Category:
Price: \$60 USD

Question description

After gaining an understanding of the components of a financial statement, analyzing and applying what the components represent, in terms of future planning, are the most important aspects of working in healthcare finance. Consider the following data and make your best analysis of per member per month (PMPM) rates, considering reductions in utilization or pricing.

Bay Pines Medical Center estimates that a capitated population of 50,000 would have the following base case utilization and total cost characteristics:

 Service Category Inpatient Days per 1,000 Enrollees Average Cost per Day General 150 \$1,500 Surgical 125 \$1,800 Psychiatric 70 \$700 Alcohol/Drug Abuse 38 \$500 Maternity 42 \$1,500 Total 425 \$1,367

In addition to medical costs, Bay Pines allocates 10 percent of the total premium for administration/reserves.

On the basis of your data analysis, respond to the following:

• What is the PMPM rate that Bay Pines must set to cover medical costs plus administrative expenses?
• What would be the rate if a utilization management program were to reduce utilization within each patient service category by 10 percent? And by 20 percent?
• Consider the initial base case utilization assumption. What rate would be set if the average cost on each service were reduced by 10 percent?
• Assume that both utilization and cost reductions were made. What would the premium be?

(Top Tutor) Daniel C.
(997)
School: UIUC

Studypool has helped 1,244,100 students

## Review from our student for this Answer

SoccerBoss
Jun 10th, 2015
"Thanks, good work"

Type your question here (or upload an image)

1822 tutors are online

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors