what is the estimated reduction in variable costs?
Your hospital has been approached by a major HMO to perform all their MS-DRG 470 cases (major joint Show more 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 $10000 per case. You have reviewed your charges for MS-DRG 470 during the last year and found the following profile: Average Charge $15000 Average LOS 5 Days Cost/Charge Variable Cost % Routine Charge $3600 0.80 60 Operating Room 2657 0.80 80 Anesthesiology 293 0.80 80 Lab 1035 0.70 30 Radiology 345 0.75 50 Medical Supplies 4524 0.50 90 Pharmacy 1230 0.50 90 Other Ancillary 1316 0.80 60 Total Ancillary $11400 0.75 50 Your medical supply charges would be reduced by $2000 what is the estimated reduction in variable costs? Show less
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