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Premium Rate Case Study

Complete Case 5: Blue Pointe Healthcare:

Assist with writing a case review that addresses premium development. That include quantitative and qualitative factors, conclusions and recommendations.

This case illustrates the development of a premium rate by a managed care plan for submission of a bid to furnish healthcare services to employees of a buyer consortium.

This model differs from most models in that much of the input data required is in the MODEL-
GENERATED DATA section. All input values in the student version have been replaced with zeros.
Thus, students must enter the appropriate input data into the red cells containing a zero or hyphen.
When this is done, any error cells will be corrected and the base case solution will appear. However, the model does not contain any scenario analyses, so students will have to create their own if necessary. Furthermore, students must create their own graphics output (charts) as needed to present their results.

Note that the historical cost input data for facilities services is the per deim reimbursement rate for inpatient acute care, the daily cost for skilled nursing facility care, the daily cost for inpatient mental health care, the per case cost for hospital-based surgery, and the per visit cost for emergency room services.

The historical utilization input data for facilities services is days per member for acute care, nursing home care, and inpatient mental health care; cases per member for inpatient surgery; and visits per member for emergency room care.

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Development

Qualitative Factor:

Blue Pointe Healthcare premium development cover two different categories of expenses one is the cost of proving required health care services and the other is administration cost and cost of reserves. The organization has adopted multistep approach to set its premium and these steps include:
(i) Estimation of base per member per month (PMPM) for each of the plan's covered benefit. This base PMPM cost is basically developed using the historical utilization and cost data. For ...

Solution Summary

The solution discusses the premium rate case study.

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