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Hi, Can anyone help me to answer the Question below - even if it with a similar problem. Question: Using the questions below, can you provide samples...
Hi,
Can anyone help me to answer the Question below - even if it with a similar problem.
Question:Using the questions below, can you provide samples that I can follow to resolve similar questions?
For the following three problems, start with the price-setting example from the text. The initial assumptions are provided in the table below.
Total cost
$100,000
Total volume
1,000
Average cost
$100
Payer volumes
Medicare (payment rate = $95)
400
Medicaid (payment rate = $75)
100
Managed Care # 1 (payment rate = $110)
300
Managed Care # 2 (pay 80% of charges)
100
Uninsured (pay 10% of charges)
100
Total all payers
1,000
Desired net income
$5,000
6. Start with the original assumptions. Notice that managed care plan #1 receives a much lower price in return for sending a larger volume of patients. Managed care plan #2 (MC#2) wants to pay a lower cost per case and is willing to send 250 more patients (350 total from MC#2) to the clinic in return for a rate of $110 per case. Assume that the average cost per case drops to $90 due to the economies of scale. All other assumptions are unchanged. What is the new required price?