Westmount Retirement Residence Case Summary

1.) What is the marginal cost estimate of the Phase 4 hospital services, assuming that 60 percent of the designated costs are fixed and the remaining costs are variable?

Overhead costs are the costs of support services that contribute to the effective running of the Aneurin Bevan University Health Board. They are costs not driven by the level of patient activity and are apportioned to service costs because there are no clear patient activity based allocation methods. Examples include the chief executive’s salary, business planning, and human resources.

with their return on investment, employees are paid and treated fairly, and customers are satisfied with the

In this assignment I will be choosing and describing a service user for my case study and I’m going to explain how some factors such as medical disorders, life style and many more may have influenced their dietary intake. Due to the data protection I will not be using their real name.

Prices of the different products and services of the organization should be market specific. The economic capability and disposable income of clients should be put into consideration in setting prices for the products and services offered by the organization. By matching prices with the economic capability of a people, it would be much easier to for customers to access the products and services without straining or having to compromise and going for other products of lower quality (Donna, 2012).

Patients who use peritoneal dialysis change their own cleansing solutions at home, usually about six times per day. This procedure can be done manually when active or automatically by machine when sleeping. However, the patient’s overall condition, as well as the positioning of the catheter, must be monitored regularly by nurses and technicians at the Dialysis Center (Gapenski, pg. 27-28). The Outpatient Clinic currently takes up 80 percent of the space it shares with the Dialysis Center. The recent growth in volume has created a need of 25 percent more space for the Clinic. Its large size compared to the Dialysis Center and its patients frequent use of other departments in the hospital are justifications as to why it was decided to move the Dialysis Center to another building. Big Bend Medical Center currently doesn’t have adequate space to house the Dialysis Center, so it was also decided to build a new 20,000-square-foot building. This expansion and move were went to benefit both departments and help increase patient volume. The goal of increased patient volume is expected, but the directors and other department heads did not agree with the new allocation of indirect costs. In the past, facilities costs were aggregated, so all departments were charged cost based on the average embedded cost regardless of actual age of the space occupied. Since many department heads considered this

Under the current indirect cost allocation scheme (Exhibit 1) the Dialysis Center’s Revenues and Direct Costs are as follows: total revenue is $2,700,000, direct expenses are $2,100,000, the contribution margin is $600,000, and their percent of revenues is 22.2%. Their indirect costs are as follows: facilities cost is $300,000, general overhead is $270,000, and total overhead is $570,000. This leaves the Dialysis Center with $30,000 in net profit and 1.1% in percent of revenues. Additionally, square footage is allocated at $15.00 per square foot on an aggregated basis. Lastly, their general overhead costs are set at 10% of their total revenues.

competition and provides a commonly requested service. Customers will take notice to the fact that

The capitated managed care agreement with the city allows the hospital to receive $250 per month per family for taking care of the 300 city employees and their families, whether they are sick or not. Utilizing the full cost method, the hospital incurs a profit loss of $51,898,395, meaning that a rate increase of $14,166.22 is required in order to cover the full cost for the year. When applying the differential cost the hospital also incurs a profit loss of $15,119, and a rate increase of $3,949.72 is required in order to cover the differential cost for the year.

3) Goal setting- allow the client to set reasonable goals for his/or herself. Once the goal has been established, then we will discuss how important it

The purpose of the analysis was to highlight potential revenue lost in the Intensive Care Unit by illustrating the lack of charges submitted and lack of a user-friendly system in place to capture the supplies used. Currently there is an unclear process that is carried out across the facility. not just in the ICU division. Each unit has a different way to capture charges, and some couldn’t speak to the process at all. The current ICU analyzed has one Assistant Nurse Manager (ANM) that charges for items by entering items used off a list that is to be filled out by the bedside nurse or charge nurse. Adding the product information into the new EMR under the patient visit charges for the high cost items. If this ANM is not working, the items did

2. Why is it important that you allow customers the opportunity to voice concerns and to question any quotes or estimates that are provided?

3. The new system allows charging additional services required by the clients, generating more revenue. 4. Knowing which are the cost drivers , it will be possible to control costs more effectively (reducing fixed costs and increasing net margin) 5. Market analysis with direct competitor in the region suggests that studio prices are at least 21% lower and one bedroom suite prices are at least 40% lower than the competition in the new pricing model. Comparison with the general market suggests similar findings. MAIN REPORT

i. This is and existing successful model , therefore with minimal investment we can continue service the customer.

2. Then we need to understand the customers with whom we have been successful and why.