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##### Walden MMHA 6234 Exercises: 9.1, 9.4, and 9.7

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Question;Exercises: 9.1, 9.4, and 9.7Complete Exercises 9.1, 9.4 and 9.7. Use the Excel document below to record your answers.Note: For 9.7, provide a short response to the following (9.7j): "Use the measures in 9.7h and i for the final comparison among the three sites, and discuss potential problems at each site or overall for the company. What are your recommendations to correct them?"Exercise 9.1:The chief at the ultrasound division of the radiology department in a community hospital would like to measure the multi-factor productivity for a ?complete abdomen? procedure. The last three years of data were accumulated, as shown in Table EX. 9.1TABLE EX 9.1Measurement Year 1 Year 2 Year 3Price ($) 880 883 886Volume 5,583 6,312 6,129Labor ($) 75,000 77,000 80,000Materials ($) 2,750 2,900 3,1006,500 6,700 7,000a. What are the multi-factor productivity ratios for these years?b. What can you conclude about the productivity trend for this procedure?Exercise 9.4:Calculate the case mix index for the following hospitals, which use the same patient classification system, using the data in Table EX. 9.4.TABLE EX. 9.4Patient Classification Direct CareHours Hospital 1 Hospital 2 Hospital 3 Hospital 4Low-level care 3.0 0.50 0.35 0.30 0.20Medium-level care 6.0 0.35 0.40 0.30 0.25High-level care 9.0 0.10 0.15 0.22 0.30Extreme care 12.0 0.05 0.10 0.18 0.25Exercise 9.7:The PERFORMSBETTER MEDICAL CENTER (PMC), a three-site urology group practice, requires productivity monitoring. To create a benchmark for future years and to be able to compare performance to similar peer practices, the data in Table EX 9.7 were gathered for each of the three lacations.TABLE EX 9.7Measurements/Sites Location 1 Location 2 Location 3Annual Visits 135,000 94,000 101,000Annual Paid Hours 115,000 112,000 125,000Patient Classification (Based on CPT Coding) Initial Visit (.55)* .30 .10 .15Low-Level Decision Making (.50) .40 .20 .15Medium -Level Decision Making (.75) .20 .40 .35High -Level Decision Making (1.40) .10 .30 .35Skill-Mix Distribution Specialists ($110/hr.)+ .50 .30 .70General Practitioners ($85/hr.) .30 .50 .30Nurse Practitioners ($45/hr.) .20 .20 .00*Represents total hours of direct care required per patient visit within the category+ Represents hourly compensation including fringe benefits for the skill levelAssume that 1 general practitioner =.75 specialists, and 1 nurse practitioner =.35 specialists for economic measure of skill substitution.Calculate:a. Work hours/visitsb. Adjusted work hours /visitsc. Work hours /adjusted visitsd. Adjusted work hours/adjusted visits?e. Total salary expense/visitsf. Total salary expense /adjusted visits?g. Percent of work hours in direct patient careh. Percent of adjusted work hours in direct patient care?i. Total salary expense/hours of direct patient care??Use these measures for the final comparison among the three sites, and discuss potential problems at each site or overall for the company. What are your recommendations to correct them?Week 5 Exercise AssistanceExercise 9.1 a: Formula 9.2 and Example 9.2, p. 208Exercise 9.4 a: Formula 9.8 and Example 9.8, p. 218-219Exercise 9.1:a. Formula 9.2Multi-factor Productivity = Service Item * Price / Labor + Material + OverheadEXAMPLE 9.2:A specialty laboratory performs lab tests for the area hospitals. During its first two years of operation the following measurements were gathered,Measurement Year 1 Year 2Price per test ($) 50 50Annual tests 10,000 10,700Today labor costs ($) 150,000 158,000Material costs ($) 8,000 8,400Overhead ($) 12,000 12,200Exercise 9.4:a. Formula 9.8Case mix index j =? Wi PijwhereWi = weight for ith category carePi j = percent of patients for acuity category i in unit jEXAMPLE 9.8:Unit A and unit B (from Example 9.3), medical care units in Memorial Hospital, classify patients into four acuity categories (Type 1 through Type IV), with direct care requirements per patient day being respectively, 0.5, 1.5, 4.0, and 6.0 hours. Annual distributions of patients in these four acuity categories in Unit A were 0.15, 0.25, 0.35, and 0.25. Annual distributions of patients in Unit B were 0.15, 0.30, 0.40, and 0.15. Calculate the case mix for these two units, and determine which unit has been serving more severe patients.Solution:Using formula (9.6), first calculate the weights for each of the four categoriesW1 = H1 /? H1 / n = 0.5 / (0.5 + 1.5 + 4.0 + 6.0) / 4 = 0.5 / 12 / 4 = 0.5/3 = 0.17W2 = H2 /? H1 / n = 1.5 / (0.5 + 1.5 + 4.0 + 6.0) / 4 =1.5 / 12 / 4 = 1.5/3 = 0.5W3 = H3 /? H1 / n = 4.0 / (0.5 + 1.5 + 4.0 + 6.0) / 4 =4.0 / 12 / 4 = 4.0/3 = 1.33W4 = H4 /? H1 / n = 6.0 / (0.5 + 1.5 + 4.0 + 6.0) / 4 =4.0 / 12 / 4 = 6.5/3 = 2.0Then apply formula (9.8) to calculate the case mix as:Case mix index A =? Wi PiA =(0.17 * 0.15) + (0.5 * 0.25) + (1.33 * 0.35) + (2.00 * 0.25

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