Assignment: Calculating the reimbursement/revenue
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Complete questions 7-8 in the designated Discussion Board thread.
Community Hospital is a 455-bed hospital. You are starting to look at your sources of revenue for the next year.
For purposes of this assignment, you will be looking at the reimbursement you will receive from Medicare and from Commercial Insurers. This assignment is just looking at a snapshot of the revenue that an institution would receive.
Keep in mind that if you miscalculate in one area, it will affect all other answers, so make sure to double and triple check your input and calculations.
Assume your hospital’s rate is $6452. This includes provisions for the wage index and labor and non-labor rate. Your top 5 MS-DRGs along with the anticipated number of discharges for 2020 are listed below. You will need to look up the MS-DRG weight for these DRGs on the CMS listing. Calculate the projected reimbursement you are scheduled to receive from Medicare. Enter your work in the table below. (10)
|MS-DRG||Description||Weight||# of Discharges||Reimbursement|
|291||Heart Failure w MCC
|470||Major Joint Replacement or Reattachment of LE w/o MCC||766|
|392||Esophagitis, Gastroenteritis and Misc Digestive Disorders w/o MCC||573|
|195||Simple Pneumonia & Pleurisy w/o CC or MCC
|690||Kidney and Urinary Tract Infections w/o MCC||343|
|Total Projected Medicare Reimbursement|
Commercial Insurance Reimbursement
You anticipate the following activity for 2020 for commercial insurance patients. Using the price information from Elyria Medical Center, calculate the projected reimbursement you are scheduled to receive from commercial insurance patients prior to negotiating a rate. Enter your work in the table below(10)
|Emergency Room Visit Level 2||4,552 Visits|
|Medical ICU 202||28,300 days|
|Semi-private Med/Surg 121||124,286 days|
|C-sections Flat Rate||276|
|Total Projected Commercial Insurance Reimbursement|
- What will your gross (Medicare and Commercial) patient revenue be? (for this assignment, assume that reimbursement equates to revenue) (2)
|Gross patient revenue|
Using the numbers above, you have the following assumptions:
- Assume that your commercial payers have negotiated a 30% discount for their patients. (2)
|Total Commercial Payer Adjusted Rate|
- Medicare will deny 5% of your reimbursement due to poor coding and billing discrepancies. (2)
|Total Medicare Adjusted Rate|
- You anticipate providing $300,000 in charity care
- What is your net patient service revenue based on # 1, 2, and 3 above? (3)
|Net Patient Service Revenue|
- Based on past experience, 10% of your net patient service revenue will be uncollectable accounts. What is your anticipated net patient service revenue less your allowance for uncollectable accounts for 2020? (3)
|Net Patient Service Revenue (less allowance for doubtful accounts)|
- If your anticipated expenses for 2020 are $73,500,000, what will your net income or loss be? (3)
|Net Income (Loss)|
Enter your responses to # 7 & 8 in the designated discussion board threads.