Pmpm rate that dixie must set to cover


Problem:

Dixie Medical Center estimates that a cpitated population of 50,000 would utilize 450 inpatient days per 1000 enrollees at an average cost of $1,200 per day. Assume that in addition to medical costs Dixie allocates 10% of the total premium for administrative and reserve cost.

Required:

Question: What is the PMPM rate that Dixie must set to cover all medical/administrative/reserve cost?

A. $45

B.$49.50

C.$40

D. $55

Note: Show all workings.

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Accounting Basics: Pmpm rate that dixie must set to cover
Reference No:- TGS0890393

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