Using the example of Table 62, assume that the average cost has jumped from $100...
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Accounting
Using the example of Table 62, assume that the average cost has jumped from $100 to$105. All other factors in the example remain the same. What will be the new required price?
Table 62 Price-Setting Example
Total cost
$100,000
Total volume
1,000
Average cost
$100
Payer volumes
Medicare (payment rate = $95)
400
Medicaid (payment rate = $75)
100
Managed Care # 1 (payment rate = $110)
300
Managed Care # 2 (pay 80% of charges)
100
Uninsured (pay 10% of charges)
100
Total all payers
1,000
Desired net income
$5,000
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