If 50 percent of the patients are Medicaid and 50 percent are self-pay, what charge rate (price) must be set to generate $150,000 in profit?

Do you agree that virtue is a matter of balance and moderation?
May 8, 2018
Mrs Brown, a 78 year-old female, was admitted to the Emergency Department at 6am after waking up with severe breathlessness. Her family informed you that the patient has a history of heart failure that had been diagnosed two years ago. On admission to the Emergency Department the clinical manifestations were: Severe dyspnoea…
May 8, 2018

If 50 percent of the patients are Medicaid and 50 percent are self-pay, what charge rate (price) must be set to generate $150,000 in profit?

A nursing home has two categories of patients – Medicaid and self-pay. Medicaid pays $60 per day and self-pay patients pay the established daily charge, but approximately 10% of self-pay billings are not collected. If 50 percent of the patients are Medicaid and 50 percent are self-pay, what charge rate (price) must be set to generate $150,000 in profit? Variable costs are $45.00 per day and fixed costs are expected to be $1,000,000. Expected volume is 50,000 patient days.

 

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