The subsequent two spreadsheets provide workload (expressed as relative weighted products (RWPs) for inpatient care), revenue, and expense data for Schumpert Medical Center covering their fiscal years 2010 and 2011. The data includes FY10 actual workload, revenues, and expenses; FY11 forecasted workload, revenues, and expenses; and FY11 year-to-date workload, revenues, and expenses. The Inpatient Product Lines worksheet provides further details on the types of services provided within each major service line. Using the available data, perform a variance analysis on Schumpert Medical Center and answer the following questions: 1. What was the hospital's original profit forecast (assume away any issues with depreciation, taxes, etc.)? Halfway through the fiscal year, what is the hospital's revised projection for FY11 profits?

The subsequent two spreadsheets provide workload (expressed as relative weighted products (RWPs) for inpatient care), revenue, and expense data for Schumpert Medical Center covering their fiscal years 2010 and 2011. The data includes FY10 actual workload, revenues, and expenses; FY11 forecasted workload, revenues, and expenses; and FY11 year-to-date workload, revenues, and expenses. The Inpatient Product Lines worksheet provides further details on the types of services provided within each major service line. Using the available data, perform a variance analysis on Schumpert Medical Center and answer the following questions: 1. What was the hospital's original profit forecast (assume away any issues with depreciation, taxes, etc.)? Halfway through the fiscal year, what is the hospital's revised projection for FY11 profits? Answer: 2. Which inpatient service lines are overbudget? Which product lines are overbudget after accounting for workload increases? Answer: 3. What actions would you take at the mid-year point if you were a fee-for-service hospital? In other words, where are the problem areas on which you would focus your attention, and who might provide ideas for "best practices" based on their performance? Answer: 4. What actions would you take at the mid-year point if you were a capitated hospital? In this case, the revenue spreadsheet would be replaced with an overall budget of $50 million with which to operate (rather than being able to bill for each episode of patient care). Federal, state, county, and city hospitals normally operate under a capped budget. Additionally, many HMOs also operate under a fixed Per Member, Per Month (PMPM) capitated process. Answer: Schumpert Medical Center Revenues Worksheet, Mid-Year Review Inpatient Inpatient Product Line CIRC DIGEST ENT GYN MENTAL HEALTH NERVOUS NEWBORN OB ORTHO OTHER RESP Total Inpatient Earnings Price/RWP $6,010.65 $6,021.65 $6,001.65 $6,013.65 $502.99 $6,103.65 $7,014.71 $5,713.65 $6,084.18 $6,018.14 $6,118.73 Forecasted RWPs For FY11 724 1,161 130 219 1,351 228 733 1,501 631 2,152 677 9,506 Projected IP Revenue For FY11 $4,351,711 $6,988,125 $780,215 $1,313,983 $679,539 $1,391,632 $5,141,782 $8,576,189 $3,839,118 $12,951,037 $4,142,380 $50,155,710 Actual RWPs (FY11 YTD) 421 636 72 116 736 112 433 868 274 800 197 4,664 Actual IP Revenue (FY11 YTD) $2,530,676 $3,830,402 $433,948 $697,128 $369,949 $682,744 $3,033,900 $4,960,622 $1,664,658 $4,813,961 $1,202,960 $24,220,949 Schumpert Medical Center Expenses Worksheet, Mid-Year Review Inpatient Inpatient Product Line CIRC DIGEST ENT GYN MENTAL HEALTH NERVOUS NEWBORN OB ORTHO OTHER RESP Total Inpatient Expenses Budget/RWP (FY10) $5,475.81 $5,476.81 $5,477.81 $5,478.81 $498.78 $5,478.81 $5,478.81 $5,478.81 $5,478.81 $5,478.81 $5,478.81 Actual RWPs (FY10) IP Expenses (FY10) Forecasted RWPs (FY11) 690 1,105 124 208 1,287 217 698 1,430 601 2,050 645 $3,778,309 $6,051,875 $679,248 $1,139,592 $641,930 $1,188,902 $3,824,209 $7,834,698 $3,292,765 $11,231,561 $3,533,832 $43,196,922 724 1,161 130 219 1,351 228 733 1,501 631 2,152 677 9,506 FY11 Budget (FY10+6% Inflation) $4,202,356 $6,737,188 $754,842 $1,268,947 $714,283 $1,324,119 $4,256,926 $8,717,115 $3,664,557 $12,497,823 $3,931,704 $48,069,860 Actual RWPs (FY11 YTD) 421 636 72 116 736 112 433 868 274 800 197 4,664 Actual IP Expenses (FY11 YTD) $2,472,822 $4,356,173 $462,822 $777,322 $400,730 $675,173 $2,971,020 $5,472,892 $1,771,063 $4,662,277 $1,233,771 $25,256,062 Product Line CIRC DIGEST ENT GYN MH MH NERVOUS NEWBORN OB ORTHO OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER OTHER RESP MDC Description Diseases and Disorders of the Circulatory System Diseases and Disorders of the Digestive System Diseases and Disorders of the Ear, Nose, Mouth, and Throat Diseases and Disorders of the Female Reproductive System Mental Diseases and Disorders Alcohol/Drug Use and Alcohol/Drug Induced Organic Mental Disorders Diseases and Disorders of the Nervous System Newborns and Other Neonates with Conditions Originating in Perinatal Period Pregnancy, Childbirth, and the Puerperium Diseases and Disorders of the Musculoskeletal System and Connective Tissue Unknown Diseases and Disorders of the Eye Diseases and Disorders of the Hepatobiliary System and Pancreas Diseases and Disorders of the Skin, Subcutaneous Tissue and Breast Endocrine, Nutritional and Metabolic Diseases and Disorders Diseases and Disorders of the Kidney and Urinary Tract Diseases and Disorders of the Male Reproductive System Diseases and Disorders of the Blood, Blood Forming Organs, Immunological Dis Myeloproliferative Diseases and Disorders, Poorly Differentiated Neoplasm Infectious and Parasitic Diseases, Systemic or Unspecified Sites Injuries, Poisonings and Toxic Effects of Drugs Burns Factors Influencing Health Status and Other Contacts with Health Services Multiple Significant Trauma Human Immunodeficiency Virus Infections Diseases and Disorders of the Respiratory System