Question
Mountains Medical Center has had a contract with BigGreen Medical Plan for the past year. BigGreen expected to have a total budget for the Medical
Mountains Medical Center has had a contract with BigGreen Medical Plan for the past year. BigGreen expected to have a total budget for the Medical Center of $3,500,000 per year for 10,000 people, based on a $700 per diem payment and 500 days per thousand. There was a 10% withholding taken by BigGreen to be used as a bonus pool split evenly between the plan and the hospital for total payments being less than budgeted. During the past year, the days per thousand at Mountains Medical Center was 450.
Calculate What payment should the Medical Center expect from Big Green out of that bonus pool?
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Principles of Accounting
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson
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