You have been asked by management to explain the variances in costs under your inpatient capitated contract. The following data is provided.
Inpatient Costs $12,568,500 $16,618,350
Members 42,000 42,000
Admission Rate 0.070 0.095
Case Mix Index 0.90 0.85
Cost per Case (CMI = 1.0) $4,750 $4,900
Costs per case increased to $4,900 from a budgeted value of $4,750. This increased actual total costs by what amount?© BrainMass Inc. brainmass.com June 4, 2020, 3:37 am ad1c9bdddf
You're correct. When we calculate increases from variances, we start with what was planned or budgeted, which is called the standard amount. In this case, the standard amount is $4,750. We ...
This solution calculates the amount of increased actual total costs for the inpatient capitated contract. Includes 1 additional resource.