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Question: costshifting problem assume your organization has 100 patients analyzed in...

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Cost-shifting Problem

Assume your organization has 100 patients analyzed in the following manner:

  • 15 Medicare patients, who pay $2,000 per diagnosis
  • 25 Medicaid patients, who pay $1,800 per diagnosis
  • 20 managed care patients, who pay charges minus a 20% discount
  • 10 managed care patients, who pay charges minus a 25% discount
  • 10 private pay insurance patients, who pay charges
  • 10 charity care patients, who pay nothing
  • 10 bad debt patients, who pay nothing

1. Your organization's average cost per patient is $2,000. Calculate the charge necessary to recover your cost.

Financial

Class

No.

Cost

Charges

Collections

Profit

Medicare

15

30,000

30,000

30,000

0

Medicaid

25

50,000

50,000

45,000

-5,000

Managed Care #1

20

40,000

40,000

32,000

-8,000

Managed Care #2

10

20,000

20,000

15,000

-5,000

Private

10

20,000

20,000

20,000

0

Charity

10

20,000

20,000

0

-20,000

Bad Debt

10

20,000

20,000

0

-20,000

Total:

100

200,000

200,000

142,000

-58,000

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