Friday, February 13, 2015

CLARION Case Questions and Answers 2/13/2015

Question: 
I would like to know if we will be provided with a patient/provider mix of STHN in order to make an analysis on that.

Answer:  
STHN is a start-up organization, so it would have limited experience with payor mix. The area is both poor and aged, so you can reasonably assume that the member organizations serve a heavier than average Medicare and Medicaid mix.  If you feel this information is important to arrive at your recommendation, then as part of your research, examine the patient/provider mix in the member organizations listed for that region.  

Question: 
Will you provide us with an income statement and balance sheet?

Answer:  
Review the resources provided with the case. Keep in mind that STHN is in start-up mode. It has had capital contributions from the members to get started. The members will need to make additional capital contributions based on the business plan. That is why re-looking at the assumptions and strategy is so important…if the costs of care are higher than expected the members will have to contribute more capital. That is also why the payment model is so important. A current income statement and balance sheet would do little to inform your thinking. If you feel that you need more detail, then as part of your research you can explore income statements and balance sheets for comparable organizations and make reasonable assumptions based on that research.

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