case statistics ( business statistics )
Question 1
Copayment is an insurance service plan between the insurance company and the service provider. The payment method is applied by the patient where they pay a deductible amount to the insurance company. The insurance company will thus make a percentage of the payment on behalf of the patient to the hospital and the patient will pay the other percentage directly. Green Guard Care has provides a copayment plan for their employees where they pay $15 for every office visit. From the estimated percentage change of costs, the number of physician visits is increasing hence the high cost of payment by the company. There is an average percentage of one which is not very expensive as the numbers of employees are still growing resulting to the increased visits.
If the company choses to increase the copayment the insurers will be able to reduce the cost since the increase will be shifted to the insured individual. The increase may also have a negative effect and may burden the insured as they will have to pay a higher deductible amount to cover their insurance plan. When the care center chooses to reduce charges of visits, they will have very expensive spending. The number of visits will be high especially for the outpatients as they will pay little from their contribution. Having a copayment plan it ensures that the patient can receive treatment as much as they cannot afford to pay for the entire service. The percentage cost of office visits are the highest in both July and August, 2016 analysis.
| July, 2006 | August, 2006 | % of total cost in July | % of total cost in August | |
| Hospital Services - Inpatient | 203,425.00 | 212,250.00 | 22% | 22% |
| Hospital Services - Outpatient | 182,440.00 | 180,700.00 | 20% | 18% |
| Surgical Services | 101,250.00 | 103,400.00 | 11% | 11% |
| Physician Office Visit | 337,900.00 | 391,450.00 | 37% | 40% |
| Administrative expenses | 90,000.00 | 90,000.00 | 10% | 9% |
| Total | 915,015.00 | 977,800.00 |
It would be advisable to choose the increase of copayment plan as a method of controlling future costs.
