Assignment Exercise 1: Contractual Allowances

Physician office revenue for visit code 99214 has a full established rate of $72.00. Of ten different payers, there are nine different contracted rates, as follows:

Payer Contracted Rate
FHP $35.70
HPHP 58.85
MC 54.90
UND 60.40
CCN 70.20
MO 70.75
CGN 10.00
PRU 54.90
PHCS 50.00
ANA 45.00

For each payer, compute the contractual allowance.

Assignment Exercise 2: Revenue Sources and Grouping Revenue

The Metropolis Health System has revenue sources from operations, donations, and interest income. The revenue from operations is primarily received for services. MHS groups its revenue first by cost center. Within each cost center the services revenue is then grouped by payer.

For each of the six situations, indicate its number(1 through 6). Then place and X in the column(s) that represent the correct revenue source(s) for the item. The six situations are:

(1) ICU stay billed to employee's insurance program.-
(2) Lab test paid for by an individual.-
(3) Pathology work performed for the state.-
(4) ICU stay billed to member's health plan.-
(5) ICU stay billed for Medicare beneficiary.-
(6) Series of allergy tests run for eligible Medicaid beneficiary.-

Medicare Medicaid Other Public Patients Commercial Managed

Programs Insurance Care Contracts

Assignment Exercise 3: Grouping Expenses by Cost Center

The Metropolis Health System's Rehabilitation and Wellness centre offers outpatient therapy and return-to-work services plus cardiac and pulmonary rehabilitation to get people back to a normal way of living. The Rehabilitation and Wellness Center expenses include the following:

· Nursing Salaries
· Physical Therapist Salaries
· Occupational Therapist Salaries
· Cardiac Rehab Salaries
· Patient Education Coordinator Salary
· Nursing Supplies
· Physical Therapist Supplies
· Occupational Therapist Supplies
· Cardiac Rehab Supplies
· Pulmonary Rehab Supplies
· Training Supplies
· Clerical Office Supplies
· Employee Education

Decide how many cost centers should be used for the above expenses at the Center and where each expense should be located.

Assignment Exercise 4:

Find a listing of expenses by diagnosis or by procedure. The source of the list can be internal or external. Comment upon whether you believe the expense grouping used is appropriate. Would you have grouped the expenses in another way?