Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Your hospital has been approached by a major HMO to perform all their MS-DRG 470 cases (major joint procedures). They have offered a flat price

Your hospital has been approached by a major HMO to perform all their MS-DRG 470 cases (major joint procedures). They have offered a flat price of $10,000 per case. You have reviewed your charges for MS-DRG 470 during the last year and found the following profile:

Average Charge $15,000 Average LOS 5 Days

C o s t / C h a r g e V a ria ble C o s t %

Routine Charge $3,600 0.80 60

Operating Room 2,657 0.80 80

Anesthesiology 293 0.80 80

Lab 1,035 0.70 30

Radiology 345 0.75 50

Medical Supplies 4,524 0.50 90

Pharmacy 1,230 0.50 90

Other Ancillary 1,316 0.80 60

Total Ancillary $11,400 0.75 50

1. In the above data set, assume that the hospitals cost to charge ratio is 0.80 for routine services and 0.75 for all other ancillary services. Using this information, what would the average cost of MS-DRG 470 be.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Finance With Excel

Authors: Simon Benninga

2nd Edition

0199755477, 9780199755479

More Books

Students also viewed these Finance questions