2. Assuming that the average cost of being hospitalized for mental distress is $3,985, and that people with chronic conditions more or equal to 3 have 50 percent annual risk of being hospitalized: 2. Assuming that the average cost of being hospitalized for mental distress is $3,985, and that people with chronic conditions more or equal to 3 have 50 percent annual risk of being hospitalized:

a. what is the total cost of hospitalization paid by people with chronic conditions more or equal to 3 in 2014?

3. Assuming that each person with mental health distress visits a physician once a year with an average cost of $120 per visit. Assuming that the risk of hospitalization drops to 0 if each person visits a physician once a year.

a. What would be the cost savings among people with chronic conditions more or equal to 3?

4. As the manager of a healthcare organization with staff dealing with these health conditions, propose strategies to improve health, reduce hospitalization among your staff, and optimize savings in insurance spending in your institution.

5. Do you think capitation system based on the prevalence of risk factors is actuarially fair?