The subsequent two spreadsheets provide workload (expressed as relative weighted products (RWPs) for inpatient care), revenue, and expense data for Schumpert Medical Center covering their fiscal years 2010 and 2011.

The subsequent two spreadsheets provide workload (expressed as relative weighted products (RWPs) for inpatient care), revenue, and expense data for Schumpert Medical Center covering their fiscal years 2010 and 2011. The data includes FY10 actual workload, revenues, and expenses; FY11 forecasted workload, revenues, and expenses; and FY11 year-to-date workload, revenues, and expenses. The Inpatient Product Lines worksheet provides further details on the types of services provided within each major service line. Using the available data, perform a variance analysis on Schumpert Medical Center and answer the following questions:1. What was the hospital's original profit forecast (assume away any issues with depreciation, taxes, etc.)? Halfway through the fiscal year, what is the hospital's revised projection for FY11 profits?

Answer:

2. Which inpatient service lines are overbudget? Which product lines are overbudget after accounting for workload increases?

Answer:

3. What actions would you take at the mid-year point if you were a fee-for-service hospital? In other words, where are the problem areas on which you would focus your attention, and who might provide ideas for "best practices" based on their performance?

Answer:

4. What actions would you take at the mid-year point if you were a capitated hospital? In this case, the revenue spreadsheet would be replaced with an overall budget of $50 million with which to operate (rather than being able to bill for each episode of patient care). Federal, state, county, and city hospitals normally operate under a capped budget. Additionally, many HMOs also operate under a fixed Per Member, Per Month (PMPM) capitated process.Revenues:Schumpert Medical Center

Revenues Worksheet, Mid-Year Review

Inpatient

Inpatient Product LinePrice/RWP"Forecasted RWPs

For FY11""Projected IP Revenue

For FY11""Actual RWPs

(FY11 YTD)""Actual IP Revenue

(FY11 YTD)"

CIRC$6,010.65 724$4,351,711 421$2,530,676

DIGEST$6,021.65 1,161$6,988,125 636$3,830,402

ENT$6,001.65 130$780,215 72$433,948

GYN$6,013.65 219$1,313,983 116$697,128

MENTAL HEALTH$502.99 1,351$679,539 736$369,949

NERVOUS$6,103.65 228$1,391,632 112$682,744

NEWBORN$7,014.71 733$5,141,782 433$3,033,900

OB$5,713.65 1,501$8,576,189 868$4,960,622

ORTHO$6,084.18 631$3,839,118 274$1,664,658

OTHER$6,018.14 2,152$12,951,037 800$4,813,961

RESP$6,118.73 677$4,142,380 197$1,202,960

Total Inpatient Earnings9,506$50,155,710 4,664$24,220,949Expenses:

Schumpert Medical Center

Expenses Worksheet, Mid-Year Review

Inpatient

Inpatient Product Line"Budget/RWP

(FY10)"" Actual RWPs

(FY10) ""IP Expenses

(FY10)""Forecasted RWPs

(FY11)""FY11 Budget

(FY10+6% Inflation)""Actual RWPs

(FY11 YTD)""Actual IP Expenses

(FY11 YTD)"

CIRC$5,475.81 690$3,778,309 724$4,202,356 421$2,472,822

DIGEST$5,476.81 1,105$6,051,875 1,161$6,737,188 636$4,356,173

ENT$5,477.81 124$679,248 130$754,842 72$462,822

GYN$5,478.81 208$1,139,592 219$1,268,947 116$777,322

MENTAL HEALTH$498.78 1,287$641,930 1,351$714,283 736$400,730

NERVOUS$5,478.81 217$1,188,902 228$1,324,119 112$675,173

NEWBORN$5,478.81 698$3,824,209 733$4,256,926 433$2,971,020

OB$5,478.81 1,430$7,834,698 1,501$8,717,115 868$5,472,892

ORTHO$5,478.81 601$3,292,765 631$3,664,557 274$1,771,063

OTHER$5,478.81 2,050$11,231,561 2,152$12,497,823 800$4,662,277

RESP$5,478.81 645$3,533,832 677$3,931,704 197$1,233,771

Total Inpatient Expenses$43,196,922 9,506$48,069,860 4,664$25,256,062

Inpatient Product Lines:CIRCDiseases and Disorders of the Circulatory System

DIGESTDiseases and Disorders of the Digestive System

ENTDiseases and Disorders of the Ear, Nose, Mouth, and Throat

GYNDiseases and Disorders of the Female Reproductive System

MHMental Diseases and Disorders

MHAlcohol/Drug Use and Alcohol/Drug Induced Organic Mental Disorders

NERVOUSDiseases and Disorders of the Nervous System

NEWBORNNewborns and Other Neonates with Conditions Originating in Perinatal Period

OBPregnancy, Childbirth, and the Puerperium

ORTHODiseases and Disorders of the Musculoskeletal System and Connective Tissue

OTHERUnknown

OTHERDiseases and Disorders of the Eye

OTHERDiseases and Disorders of the Hepatobiliary System and Pancreas

OTHERDiseases and Disorders of the Skin, Subcutaneous Tissue and Breast

OTHEREndocrine, Nutritional and Metabolic Diseases and Disorders

OTHERDiseases and Disorders of the Kidney and Urinary Tract

OTHERDiseases and Disorders of the Male Reproductive System

OTHERDiseases and Disorders of the Blood, Blood Forming Organs, Immunological Dis

OTHERMyeloproliferative Diseases and Disorders, Poorly Differentiated Neoplasm

OTHERInfectious and Parasitic Diseases, Systemic or U

 

 

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