Next year, Lotze Healthcare Organization (LHD) is projected to serve 100 patients analyz -20 Medicare patients, who pay $925 per diagnosis -30 Medicaid patients, who pay $885 per diagnosis -25 managed care patients (Humana), who pay charges minus a 15% discount 10 managed care patients (Anthem), who pay charges minus a 25% discount -5 private insurance patients, who pay charges in full -5 charity care patients, who pay nothing -5 self pay patients, who pay nothing (all treated as bad debt) ( Next year, LHO's costs are projected to be $1,225 per patient. Part 4: Determine new cost rate to cover project loss with $1,075 per patient cap on charges Charges Projected Collections Costs after cost cuting New Cost Per Patient Profit/Loss New Projected (Collections Costs minus Costs) Payer Medicare Medi-Cal Humana Anthem Private Insurance Charity care Self-pay Total No. 20 30 25 10 5 5 Contractual Rates/ Collection Notes Pays $925 per diagnosis Pays $885 per diagnosis Pays charges less 15% discount Pays charges less 25% discount Pays charges in full Pays nothing Pays nothing New Charge Per Patient $0 $0 $0 $0 $0 $0 $0 Total Charges "Revenue" $0 $0 $0 SO $0 $0 $0 $0 Collection Rate $0 $0 $0 $0 SO $0 $0 $0 Total Collection Amount $0 $0 $ $0 $ $0 $o 5 100 SO $0 $ $0 $0 Total Collections: Total Patients: New cost per patient for breakeven: Question 42 & 43: Cost Shifting and Cost Cutting (16 points total) Next year, Lotze Healthcare Organization (LHO) is projected to serve 100 patients analyzed in the following manner: - 20 Medicare patients, who pay $925 per diagnosis -30 Medicaid patients, who pay $885 per diagnosis -25 managed care patients (Humana), who pay charges minus a 15% discount - 10 managed care patients (Anthem), who pay charges minus a 25% discount -5 private insurance batients, who pay charges in full -5 charity care patients, who pay nothing - 5 self pay patients, who pay nothing (all treated as bad debt) Next year, LHO's costs are projected to be $1,225 per patient. Part 1: Calculate the projected profit/loss assuming charges = costs Charges = Costs Projected Collections Costs = $1,225/patient Hospital Cost Total Per Hospital Patient Costs Charge Per Patient Total Charges "Revenue" Collection Rate Total Collection Amount Profit/Loss (Collections minus Costs) Payer Medicare Medi-Cal Humana Anthem Private Insurance Charity care Self-pay Total No. 20 30 25 10 5 5 5 100 Contractual Rates/ Collection Notes Pays $925 per diagnosis Pays $885 per diagnosis Pays charges less 15% discount Pays charges less 25% discount Pays charges in full Pays nothing Pays nothing $0 $0 $0 $0 Next year, Lotze Healthcare Organization (LHO) is projected to serve 100 patients analyz -20 Medicare patients, who pay $925 per diagnosis - 30 Medicaid patients, who pay $885 per diagnosis - 25 managed care patients (Humana), who pay charges minus a 15% discount a - 10 managed care patients (Anthem), who pay charges minus a 25% discount -5 private insurance patients, who pay charges in full -5 charity care patients, who pay nothing -5 self pay patients, who pay nothing (all treated as bad debt) Next year, LHO's costs are projected to be $1,225 per patient. Part 2: Calcualate new charge to shift costs and break-even : Charges = Break-even rate Projected Collections Weighted Average No. of Patients Eligible for cost shifting? New Charge Per Patient Total Charges "Revenue" Collection Rate Total Collection Amount Profit/Loss (Collections minus Costs) Payer Medicare Medi-Cal Humana oth Anthem Private Insurance Charity care Self-pay Total No. 20 30 25 10 5 5 5 5 100 Contractual Rates/ Collection Notes Pays $925 per diagnosis Pays $885 per diagnosis Pays charges less 15% discount Pays charges less 25% discount Pays charges in full Pays nothing Pays nothing 0 $0 $0 $0 Additional cost shifting charge Original charge per patient New charge per patient Next year, Lotze Healthcare Organization (LHO) is projected to serve 100 patients analyz -20 Medicare patients, who pay $925 per diagnosis - 30 Medicaid patients, who pay $885 per diagnosis -25 managed care patients (Humana), who pay charges minus a 15% discount - 10 managed care patients (Anthem), who pay charges minus a 25% discount -5 private insurance patients, who pay charges in full -5 charity care patients, who pay nothing -5 self pay patients, who pay nothing (all treated as bad debt) Next year, LHO's costs are projected to be $1,225 per patient. Part 3: Calculate total loss if charges are capped at $1,075 per patient Charges = Projected Collections Total Collection New Charge Per Patient Total Charges "Revenue" Collection Rate Profit/Loss (Collections minus Costs) Amount No. 20 30 25 Payer Medicare Medi-Cal Humana Anthem Private Insurance Charity care Self-pay Total Contractual Rates/ Collection Notes Pays $925 per diagnosis Pays $885 per diagnosis Pays charges less 15% discount Pays charges less 25% discount Pays charges in full Pays nothing Pays nothing 10 5 5 5 100 $0 $0 $0