Houston Memorial Hosptial has annual patient revenues of\

$12,000,000

\ It has two major third party payers and some of the patients self pay. The account manager estimates\ that

8%

of the hospitals self payers pay on day 30\

52%

of pay on day 60 (Payer A)\

40%

pay on day 90 (Payer B)\ What is Fargo's average collection period?\ What is the current receivable's balance?\ What would the firm's new receivable's balance be if a new claims processing system resulted in collecting third party payments in 50 and 70 days instead of 60 and 90 ?\ Suppose the firm's annual cost of carrying reivables is

7%

. If the electronic claims system costs

$45,000

to operate per year, should it be adopted?

Houston Memorial Hosptial has annual patient revenues of $12,000,000 It has two major third party payers and some of the patients self pay. The account manager estimates that 8% of the hospitals self payers pay on day 30 52% of pay on day 60 (Payer A ) 40% pay on day 90 (Payer B) What is Fargo's average collection period? What is the current receivable's balance? What would the firm's new receivable's balance be if a new claims processing system resulted in collecting third party payments in 50 and 70 days instead of 60 and 90 ? Suppose the firm's annual cost of carrying reivables is 7%. If the electronic claims system costs $45,000 to operate per year, should it be adopted