answered: A plastic surgery center performs a procedure whose gross ch

  

A plastic surgery center performs a procedure whose gross charge is $7,000
of which $3,350 is collected. The variable cost per procedure is $1,600. The
monthly fixed cost assigned to doing this procedure is $31,000. The center wants
to generate a $25,000 profit each month in doing this procedure.
a. How many procedures per month, rounding up to the next highest
whole number if necessary, would it need to do to achieve its
profit target?
b. How many procedures per month, rounding up to the next highest
whole number, would it need to perform to break-even?
c. On your Excel spreadsheet note the algebraic formula you used
to solve these two problems. Using the Excel skills developed
in the program so far, make your spreadsheet so that it prints
on one page, and is readable. Use virtual cell references so
that your work can be easily adapted to test other
assumptions.
A healthcare provider offers a single service to its patients, and the
patients are covered by only two different third parties. Payer 1,
Medicare, represents 50% of the patients and pays a fixed fee of $315 per
patient. Payer 2, a Commercial Insurer, represents 45% of the patients
and pays 80% of the provider’s gross charge. The remaining patients are
Charity Care patients who do not pay for their services. The provider
treats 3,700 patients per month. The fixed costs of the provider each
month is $97,000, and their variable cost per patient is $282. The provider
desires to set its gross charge per patient to achieve a profit, or net
income, of $68,000 for the month.
a. Set up an Algebraic expression, with “p” being the gross charge
(price) of the service to each patient being seen in the month, to
solve this problem. Show this expression on your spreadsheet.
b. Solve the problem finding the Gross Price to be charged to
achieve the profit target.
c. How many charity patients does the organization treat per month?
d. What is the grand total sum of payments that the Commercial
Insurer pays for all its patients in a month? (Note, this is not the
total for one patient, but instead it is the total for all their patients
together in the month)
Your understanding cost/volume/profit concepts in a health care
setting.
2. Your Quantitative Literacy abilities to solve problems.
3. Your use of Excel as a tool for calculations and communicating
information.