Premium Essay

Rio Grande Medical Center

In: Business and Management

Submitted By alm1983
Words 515
Pages 3
in Student Version Copyright 2010
8/24/09 by FACHE RIO GRANDE MEDICAL CENTER Cost Allocation Concepts This case focuses on cost allocation concepts, specifically the fairness and incentives created by a new allocation system applied to a department that is moving to a new, stand-alone facility.
The primary thrust of the case is qualitative rather than quantitative, but this model can be used to compare results under alternative allocation schemes. The model consists of a complete base case analysis--no changes need to be made to the existing
MODEL-GENERATED DATA section. However, in the student version all values in the INPUT DATA section have been replaced with zeros. Thus, students must enter the appropriate values into the red cells that currently contain a zero or hyphen. When this is done, any error cells will be corrected and the base case solution will appear. Note that the model does not contain any uncertainty analyses, so students will have to create their own if required by the case. Furthermore, students must create their own graphics output (charts) as needed to present their results.

INPUT DATA: KEY OUTPUT: Dialysis Center Data: Dialysis Ctr Outpatient Ctr Total
Total revenues $- Facilities allocation ($) $- $1,900,000 $1,900,000
Total direct expenses $- Per square foot $- $19.00 $15.83
Facilities costs $- Gen overhead alloc. - 2,270,000 2,270,000
General overhead $- Per revenue $ #DIV/0! 11.4% 11.4%…...

Similar Documents

Premium Essay

Community South Medical Center

...mission should be revised. The Medical Center is in an older urban area with smaller shops and businesses. The community is trending towards a predominantly elder population. There has also been a decline in compliance with T.J.C. standards. Staffing supports new program development and the physician staff is in abundant supply. There are also major issues that need to be addressed, such as shortages in clinical staff, non-interfacing information technology systems, antiquated facilities and infrastructure, and a shift to its financial mix. Careful assessment of the aging person's perception of his or her health, health practices, and knowledge of safety factors affecting their own health is an important part of primary care in all settings. A strategic plan to handle the aging population must be addressed and plans implemented to meet the challenges and needs that the aging population would present. One of the major issues confronting the Community South Medical Center are the shortage of clinical staff including registered nurses, respiratory therapists, and medical technologists The strengths, (arrived through SWOT analysis),of Community South Medical Center is that it has comprehensive health services including acute care, residential care, independent living, in-home nursing, hospice, neonatal, and pediatric services, advanced cardiac services, a major trauma center, a center of excellence for pulmonary services, and a neurosurgery center. (Instructor. 2012) ......

Words: 1418 - Pages: 6

Premium Essay

Rio Grande Medical Center: Case 3

...Case 3 Report 1. Background Rio Grande Medical Center is a full service not-for-profit acute care hospital with 325 beds. Most of the hospital’s facilities are devoted to inpatient care and emergency services, but a 100,000-square-foot section of the hospital is devoted to outpatient (OP) services. Of the 100,000-square-foot OP section, the OP Clinic uses 80%/80,000-square-feet, and the remaining 20%/20,000-square-feet are used by the Dialysis Center. Increased patient volume at the OP Clinic has created a need for 25% more space than it is currently assigned. Due to its large size and patients’ need to access other departments the decision has been made to move the Dialysis Center to another location, and allow the OP Clinic to utilize the now open space. Gaining the Dialysis Center’s 20,000-square-feet now gives the OP Clinic their additional 25% of space needed for expansion. The Chief Financial Officer (CFO) created a Profit and Liability (P&L) Statement for the expansion, in which he utilized a new indirect cost allocation scheme. In his new indirect cost allocation scheme the CFO used actual facilities cost instead of aggregated facilities cost, which has historically been utilized by the Medical Center. Also noteworthy, is the fact that the directors’ annual bonuses are now going to be based upon full costs instead of only direct costs, which has also been historically utilized by the Medical Center. After viewing the CFO’s P&L Statement with......

Words: 2116 - Pages: 9

Premium Essay

Mass Medical Center

...1. The key problem in the Lab Central Receiving Area at Massachusetts Medical Center is poor specimen turnaround in the CRA. Delaying STAT tests can impair the care of sick patients also, it can cause specimen spoilage and the specimen will have to be recollected. 2. Average Daily Demand Formula = Add up all of the totals and divide by 7 days a week ADD = 672 specimen + 1322 specimen + 1622 specimen + 1639 specimen + 1582 specimen + 1519 specimen + 683 specimen = 9,039 specimen DIVIDED BY 7 Days a week = 1,291.29 specimen per day 3. Average Hourly Demand divided by 24 hours in a day AHD = 1291.29 specimen per day DIVIDED BY 24 hours per day = 53.80 specimen per hour 4. A. Once the specimens arrive at the lab, they are processed. Depending on what kind of specimen test they are undergoing determines which process of the two they will be put through. B. As shown above the all specimens are unwrapped, and then they undergo which ever process they are being tested under. For each of the two processes after the unwrapping they are typed up and then labeled. C. After the process at the LCRA is complete the specimens are delivered to the lab. 5. The bottlenecking occurs in the CRA in the typing processes. It takes a much longer time for the typing process to be complete. With a more efficient......

Words: 356 - Pages: 2

Premium Essay

Rio Grande

...organizations offer unreimbursed goods, services, and resources that address community-identified health needs and concerns, particularly those of people who are traditionally uninsured and underserve (Peregrine, Louthian III, & Fine). An essential element of an effective community benefits program is defining the community it will serve. Institutions will define its community in a manner consistent with its areas of expertise such as women, children, a particular ethnic group, or persons with diabetes or AIDS. Effective community benefits programs must be focused on health needs and priorities developed through a process in which the institution is open to collaboration with the community. Community Benefits include traditional charity care, medical education, community health services and research. Forty years later, Congress and various federal agencies have questioned whether and how health care organizations were meeting the tax exemption requirements. Congress added new requirements that overlay the Community Benefit standard through the Affordable Care Act. In addition, to complying with the Community Benefit standard, tax-exempt hospitals must also satisfy the requirements of Section 501(r) (IRS. org, 2013). The requirements include conducting community needs assessment and implementing a strategy to address needs, communicating financial assistance policies, limiting charges for indigent patients and following certain billing and collection practices. The Community......

Words: 442 - Pages: 2

Premium Essay

Rio Grande

...Case Study: Rio Grande Medical Center Domonique Chapman HCM 733 F1WW Professor Edward Schaffer July 13, 2014 Justification of Additional Space Based on my interpretation of the allocation costs for the Outpatient Clinic Advantages & Disadvantages Facility Allocation Recommendation for Final Allocation References Case Study: Rio Grande, Week 2 Learning Outcome: Justify an indirect cost allocation scheme for outpatient services for a healthcare organization. | Score | | Below Expectations0 – 15 | Approaches Expectations16 - 17 | Meets Expectations18 - 20 | | 1. Justification of additional space for Outpatient Clinic | Justification of additional space for Outpatient Clinic is insufficient. | Justification of additional space for Outpatient Clinic is sufficient. | Justification of additional space for Outpatient Clinic is comprehensive. | | | Below Expectations0 – 11 | Approaches Expectations12 - 13 | Meets Expectations14 - 15 | | 2. Discussion of advantages and disadvantages of new methodology and justification | Discussion of advantages and disadvantages of new methodology and justification is insufficient. | Discussion of advantages and disadvantages of new methodology and justification is sufficient. | Discussion of advantages and disadvantages of new methodology and justification is comprehensive. | | | Below Expectations0 – 11 | Approaches Expectations12 - 13 | Meets Expectations14 - 15 | | 3. Facility......

Words: 408 - Pages: 2

Premium Essay

Rio Grande

...Rio Grande Supply Co. Objective: To determine the appropriate action of Jasper Hennings as the president of the company to the two employee, Henry Darger the chief of operations and the female employee that Henry Darger fired. Statement of the Problem: How does Jasper Hennings the president of the Rio Grande Supply Co. handle the issue of Henry Darger by firing the female employee by following the company’s values it adopted: integrity, honesty, and a respect for each individual employee? Analysis of the Problem: Jasper Henning can fire Henry Darger but it is costly and it is hard to find another employee that could fit the position of Henry Darger. But I suggest not to fire Henry Darger but send him in a counseling procedures in order to give him the correct punishment. Also I suggest to hire the female employee and send him also to counseling. Questions: 1) What environmental factors have helped to create the situation Jasper Hennings faces? What factors does Jasper need to consider when deciding on his course of action? 2) Analyze Rio Grande’s Culture. In addition to the expressed cultural values and beliefs, what other subconscious values and beliefs do you detect? Are conflicting values present? When values are in conflict, how would you decide which ones take precedence? 3) Assume you are Jasper. What are the first two action steps you would take to handle the Henry Darger situation? How would your role as a cultural leader......

Words: 474 - Pages: 2

Premium Essay

Emanuel Medical Center

...Introduction This paper strives to answer questions based on the case study “Emanuel Medical Center: Crisis in the Health Care Industry”. As excerpted directly from the case study, Mr. Robert Moen, Emanuel Medical Center (EMC) president and CEO, was experiencing a number of challenges in 2002. The medical center faced numerous challenges in its external and internal environment. First, EMC garnered an onslaught of negative attention for the “Haley Eckman incident” in which a young man, who happened to be a gang member, died within view of EMC’s Emergency Department (ED) medical personnel rendered no care and watched. The emergency department at EMC was also experiencing greater pressure to deliver services in an increasingly difficult health care environment, particularly after the federal Emergency Medical Treatment and Active Labor Act (EMTALA) was enacted; legislation that required access to emergency medical care for all, regardless of one’s ability to pay. Additionally, larger, for-profit managed care facilities were making substantial advances into EMC’s service area. Internally, the cost of operating the ED had increased significantly and patient traffic had vastly exceeded the capacity for which the ED had been designed. In addition, reimbursements for services from health maintenance organizations (HMO) and government programs had been drastically reduced. At the same time that other regulatory burdens had increased, EMC began to experience labor......

Words: 1423 - Pages: 6

Premium Essay

Rio Grande Supply Company Case Study

...Rio Grande Supply Company Case Study The president of Rio Grande Supply Company, Jasper Hennings, is facing a dilemma concerning his chief of operations, Henry Darger. Per the company’s internet use policy personal tasks are not to be done on company computers. A female employee broke this policy by accessing another employee’s email and was subsequently fired by Darger. While speaking with Mr. Hennings this employee mentioned two things; that Darger is up to something when he shuts his office door and that she intends to hire a lawyer. Mr. Hennings approached Darger to gain clarification of what the female employee meant and Darger admitted that due to stresses in his personal life he has been using the company computer to view pornography while at work. The dilemma for Mr. Hennings is how he should address the contradictions in his company internet use policy, how he should proceed with his employee Darger, and what would be the best decisions for his company. The most apparent environmental factor that led to the situation Mr. Hennings faces is inconsistency with the internet use policy. Management set out a policy stating that internet use on company computers is limited to business related activities. However, the company turns a blind eye when employees use their computers to check personal emails, check the weather and perform personal banking transactions. This sort of variation between what is policy and what is actually enforced facilitated Darger’s......

Words: 798 - Pages: 4

Premium Essay

Emamuel Medical Center

...13 CASE Emanuel Medical Center: Crisis in the Health Care Industry The Haley Eckman Story On Friday, four-year-old Haley Eckman stayed home from school because of a slight fever. She complained that she was feeling very tired. That night, Haley’s temperature increased to 104°F. At 3:15 A.M., Mr. and Mrs. Eckman took Haley to the emergency department (ED) of Emanuel Medical Center (EMC) in Turlock, California. They registered at the admissions desk and waited for someone to see them. After what seemed like forever to the Eckmans, a triage nurse came out to evaluate Haley. He asked several questions, but failed to take her temperature – a routine procedure in that situation. He then disappeared, leaving the Eckmans to wait yet again. While they waited, Haley vomited. She said she felt very weak. The family asked if Haley could lie down in a bed while they waited to see a doctor. A staff member told them that there were no available This case study was prepared by Randall Harris, Kevin Vogt, and Armand Gilinsky as a basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. © 2004 by Randall Harris, Kevin Vogt, and Armand Gilinsky. Used with permission from Randy Harris. both13.indd 670 11/11/08 12:04:27 PM MORE PROBLEMS THAN THE ED 671 beds, and that they would have to wait. The Eckmans saw several empty beds across the hall from where they sat as the staff member......

Words: 9304 - Pages: 38

Premium Essay

Medical Center of Southern Indiana

...Case #1 Medical Center of Southern Indiana History The Medical Center of Southern Indiana was the brainchild of two community members in 1973, originally named North Clark Community Hospital (NCCH). Many years after the initial conception of the NCCH, and numerous positional changes throughout the corporate structure, “North Clark Community Hospital opened its doors in September 1976,” (Rakich, Longest, & Darr, 2010). Unfortunately, NCCH only experienced difficult times for the next nine years, daily loss of profit due to unoccupied treatment beds and unused facilities, and lack of competitive advantage in the market to aid in the marketing of the hospital to increase profits eventually lead to the sale of the hospital in 1985 for $15 million to Hospital Corporation of America (HCA). HCA began reorganizing and transforming the entire structure of the hospital, these changes provoked renowned community support, to which HCA sold the hospital six years later to the City of Charleston for a drastically lower price of $2 million, thus NCCH name was changed to the Medical Center of Southern Indiana (MCSI). Internal Strengths and Weaknesses MCSI has employed very intelligent staff members, this workforce has been maintained properly creating a very low employee turnover rate of 11%, which is one of MCSI’s internal strengths. The second internal strength would be MCSI’s management of finances. MCSI internal weaknesses consist of the history attached to the hospital and its......

Words: 629 - Pages: 3

Premium Essay

The Medical Center

...The Medical Center at Bowling Green, mcbg.org, is a not-for-profit hospital that is under the operation of Commonwealth Health Corporation (CHC). It is one of six sister hospitals under the management of CHC, serving the southern KY areas. It is the largest hospital of that corporation. TriStar Greenview Regional Hospital, tristargreenviewregional.com, is a for-profit hospital that’s a part of the TriStar Health organization, which serves southcentral Kentucky and middle Tennessee areas. Both facilities are located in Bowling Green, KY. Between my two examples of for-profit and not-for-profit, both organizations had mission statements that stated they want to serve their communities through high quality care, and both claim to appreciate the staff members "with respect". TriStar goes on to say that because they are a part of a large network of hospitals, patients have more access to services whatever the need may be. Although Greenview does not provide a vision statement, they do go into more detail about what they value. I liked how they said "We recognize and affirm the unique and intrinsic worth of each individual". This is a very nice and different way to say that they want to give individualized care to each person who walks through their doors, which I find very appealing. I also liked that they made their all their value statements about people, patients and employees. This makes them seem personable. I do like the vision statement provided by Medical Center because......

Words: 781 - Pages: 4

Premium Essay

Rio Grande

...CASE ANALYSIS: RIO GRANDE SUPPLY COMPANY PROBLEM STATEMENT 1. Facts of the case  Rio Grande Supply Company is a Texas-based wholesale plumbing supply company - Promotes integrity, honesty and a respect for each individual employee as the company’s values  Has very strict policy on computer use; only for business-related activities Jasper Hennings, President, believes that a company’s top executives were largely responsible for determining a firm’s corporate culture  Henry Darger, hard-working chief of staff and a member of Jasper Hennings’ church - fired a female employee for accessing another worker’s email. - his young nephew had committed suicide and a business he’d helped his wife start had failed.  used company computer to access pornographic sites. Female employee, fired by Henry Darger for having accessed another worker’s email surreptitiously. 2. Statement of the problem How will Jasper Hennings handle the situation involving his chief of staff, Henry Darger and the female employee KEY OBJECTIVES  To define a specific course of action for Jasper Hennings involving Henry Darger and a female employee, whom Henry Darger fired DIAGNOSIS AND ANALYSIS OF CAUSES An organization’s values serve as the guiding principle that are most important in performing work and achieving goals. These values are shared amongst all employees to help them determine what is right and wrong. Values shape the culture of the......

Words: 913 - Pages: 4

Premium Essay

Rio Grande Medical Center Cost Allocation Concepts

...dialysis center should not suffer all the cost. Moving the dialysis center makes more sense because they can increase their revenue if they could take on more patients. The Outpatient Clinic increased their capacity thus should pay the costs of this consumption of the usage of 25% increase. Question 2 Yes. they should be charged the actual cost of the new facility because they are using the new facility. They were spending $300,000 allocating 20,000 square feet. Now they are spending $100,000 extra for an entire building. The outpatient clinic assumed the additional cost for the expansion of space they will be using as well. All departments’ costs would increase since the dialysis center is out of the building and not sharing the indirect costs for the facility use and other general indirect costs. Question 3 No, this only designates the money for the building and facility itself others costs. This is not including inflation, depreciation, insurance, and other fees. There are also advantages of the new building which includes the parking structure and easy access ability, newer equipment and facility therefore less maintenance required. Even though the building has a useful life over 20 years. On the 21st year it will be mortgage free however there still be other general indirect costs that makes up $270,000 of costs as well, these costs will only increase due to inflation and cost increase. Question 4 The revenue the pharmacy is making from the dialysis......

Words: 341 - Pages: 2

Premium Essay

Orangeburg Regional Medical Center

...Orangeburg Regional Medical Center HCS 235 January 16, 2012 Maria Cabanillas Orangeburg Regional Medical Center has been serving the residents in Orangeburg County over thirty years. Over the years they have added more square footage, open the doors for new wings and job opportunities. Not only that it provided close services for the patients, they no longer had to make a seventy mile drive to have a specific service done, it was now done locally. With a great staff and some state of the art equipment this makes this hospital one the best in the area. They even have a website where you can find the many different service they offer on www.trmchealth.org. Besides emergency care, Orangeburg Regional Medical Center provides a large range of services to the community. They offer an admitting/outpatient wing that allow the service into one area allowing space for Same Day Surgery, which was needed to accommodate the increase in outpatient surgery. They offer some many other services like 15-bed psychiatric unit, pediatric unit, Cancer Center for cancer patients with chemotherapy and radiation therapy. They also offer Breast Health Center, Dialysis Access Institute, Radiology Department, Vascular Center, 20-bed Rehabilitation Unit, and Health Plex for outpatient rehabilitation and wellness, endoscopy, community outreach, EKG, neurology, nursing units, pharmacy, sleep lab, wound center, volunteer service, public relation, occupational therapy, joint center, and......

Words: 1056 - Pages: 5

Premium Essay

Organizational Structure of Rio Grande

...Organizational Structure of Rio Grande An organizational structure is as individual as the company itself. No one structure is appropriate for every organization. The company must look at their options concerning organizational structure to choose the one that best fits the needs of the company. In addition to the structure, the company must look at organizational functions and organizational design. Rio Grande is an example of how a company must tailor the organizational structure to fit with the culture of the company. Organizational Structures Rio Grande began by defining the vertical structure of the company. In this they are very different from most companies. Rio Grande is a family-owned business run by the Bell family. These individuals make up the board of directors. They did not want to run their company with the typical hierarchal structure so they developed a structure they refer to as participative management. Participative management consists of a board of directors, a team of business coaches, and functional teams. According to Rio Grande Careers (2011), “associates know that part of their job is to complete and continuously improve the tasks for which they are responsible. Another part of their job is to participate in the management of the company” (A Principle-Based Company). Rio Grande defines participative management as a decentralized organization. In a decentralized organization lower-level managers make the important decisions of the......

Words: 1141 - Pages: 5

Gene Hackman | Angela Lansbury | Gerald Mohr