Determine Cost Benefit Analysis Discussion

Indiana Institute of Technology Determine Cost Benefit Analysis Discussion

HIM3700 Module 4 Assignments

Cost Benefit Analysis

You are the Director of Health Information Services at Indiana Tech Hospital and are currently charged by your hospitals’ Administration to consider outsourcing all of the coding services. As part of this project, you need to determine the value of outsourcing this work by performing a cost-benefit analysis. You have narrowed your search down to two vendors, and must determine the value, if any, to outsourcing to either one of these companies. The below tables provide all of the information you will need to carry out your analysis. Please answer the following questions on a separate document:

Vendor Information Table

 TAT Inpatient Outpatient Emergency Ancillary Paid p/ chart Vendor #1 48 hrs Yes Yes Yes Yes X Vendor #2 48 hrs Yes Yes Yes Yes Paid p/ hour X 1. Assume that you are choosing to go with Vendor #1. Their “per chart” Pricing structure is as follows:

a. $5 per inpatient chart

b. $3 per outpatient chart

c. $1.75 per ER chart

d. $1.25 per Ancillary chart

Using the date above, conduct a cost-benefit analysis to see if it is possible to entirely outsource. Provide a detailed discussion of your analysis, including your rationales. Is it feasible to outsource? Why or why not?

Average Daily Counts/Patient Type *keep in mind this is per day Patient Type Count Inpatient 80 Outpatient 85 Emergency Room 190 Ancillary 465

2. Now you will need to calculate your coding budget for next year. Use the information in the chart below, combined with the following consideration to complete your forecast:

a. All full-time staff will be getting a 2.5% raise

b. All part-time staff will be getting a 1% raise

 c. Account for fringe benefit of coding staff, which is 32% of their salary

 Coder FTE Current Rate per Hour IP Coder I 1 FTE $24.00/hr IP Coder II 2 FTE $22.50/hr IP Coder III 3 FTE $21.75/hr OP Coder I 1 FTE $19.75/hr OP Coder II 2 FTE $19.75/hr ER Coder I 1 FTE $18.25/hr ER Coder II 2 PT $18.25/hr AN Coder I 1 FTE $17.50/hr AN Coder II 2 PT $17.50/hr Current Year Salary Raise Next Year Salary *IP=Inpatient *OP=Outpatient *ER=Emergency. *AN=Ancillary. *FTE=Full Time Equivalent. *PT=Part Time

3. Considering your determinations from the first two questions, is it cost effective to consider outsourcing coding based on these results? Why or why not?

4. What would the outcome be if you considered Vendor #2 at $31.00 per hour? Explain your determination.