Assume that the only change in the original example data is that Blue Cross raises their discount to 20 percent. What price should be set?

Assume that the only change in the original example data is that Blue Cross raises their discount to 20 percent. What price should be set?

HEALTH SERVICE FINANCE CLASS

You have been asked to establish a pricing structure for radiology on a per-procedure basis. Present budgetary data is presented below:
Budgeted Procedures 10,000
Budgeted Cost$400,000
Desired Profit $80,000
It is estimated that Medicare patients comprise 40 percent of total radiology volume and will pay on average $38.00 per procedure. Approximately 10 percent of the patients are cost payers. The remaining charge payers are summarized below:

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PAYER VOLUME % DISCOUNT %
BLUE CROSS 20 4
UNITY PPO 15 10
KAISER 10 10
SELF PAY 5 40
50%

Assume that the only change in the original example data is that Blue Cross raises their discount to 20 percent. What price should be set? (Points : 10)

Assume that a certain nursing home has two categories of payers. Medicaid pays $60.00 per day and private pay patients pay the established per diem, but approximately 10 percent of private-pay charges are not collected. If 50 percent of the patients are Medicaid and 50 percent are private pay, what rate must be set to generate $150,000 in profit? Variable costs are $45.00 per day and fixed costs are expected to be $1,000,000. Expected volume is 50,000 patient days. (Points : 10)

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