Health Care Financing & Information Systems

Wk2 Assignment 2

Choose a health care facility that you are currently working with or one that you would like to work for in the future. Using the example of “From the Front Lines” in Chapter 6 of your text, calculate the break even for the number of procedures.  Use an electronic spreadsheet to show how you computed the break even and embed the spreadsheet in your paper.  Discuss the impact of the various reimbursements (e.g., Medicare, Medicaid, private, or self-pay).  Think about your upcoming capital proposal and how you might use the break-even analysis in your Capital Investment Plan Proposal.  Your paper should be one to two double-spaced pages in length.

From the Front Lines

We recently purchased an endoscopic ultrasound (EUS), which allows doctors to examine the linings of the esophagus and stomach, as well as the walls of the gastrointestinal tract. It is a necessary, but expensive, piece of equipment, which cost us $20,000 ($11,000 to purchase, plus $9,000 for renovations). Our fixed costs are four full-time equivalent employees at $336,000. Medicare payments are $885 per procedure, and each procedure requires $175 in average variable costs. It has been estimated that we will complete 500 procedures in the first year and 850 procedures in years 2 to 5.