代写HSMC/BAFI 420 – Health Finance Questions for the Midterm Exam, Spring 2023代写Java编程

日期：2024-09-15 11:18

Questions for the Midterm Exam, Spring 2023

HSMC/BAFI 420 – Health Finance

1. ORGANIZATIONAL ECONOMICS AND EFFICIENCY (Unidentified Healthcare session)

Consider the financial ratios for University Hospitals of Cleveland (UH), Medical Mutual?Health?Insurance?(MMO), and Kaiser Health?Plans?(K-P)

Note: “Capital” in the turnover and return ratios is assumed to be the amount provided by long term debt financing plus equity (where “equity” is typically labeled “net assets” on not-for-profit” balance sheets). ?In other words, it is permanent capital raised excluding trade credit.

Then the DuPont chart relationships for 2021 financial statements?are?as?follows:

Margin ?x Turnover x Leverage = Return on Equity (profit/revenue) ?(revenue/capital) ?(capital/equity) ???= ??(profit/equity) UH: ??????8.8% x 0.2 x 2.1 ??????????= 11.8% MMO: ??5.3% ????x 0.8 ??????x 1.5 ??????????= ?6.5% K-P: ??????8.7% x 1.2 x 1.5 ??????????= 15.3%

[a]. For each of these, what factors are the most important determining the level of each ?multiplier in the relationship? Explain your rationale. (Note: Attached note from class on drivers of financial structure in Appendix A might help in considering candidates)

[b]. How do you suppose the recent epidemic affected this data for each organization? Why?

2. HEALTH CARE INVESTMENT (Seamans Clinic session)

For each of?the following three potential investments by a hospital system, describe the key factors?(relevant cash flows, key risks, major players, decision criteria, etc.) that would drive your recommendations. Feel?free?to investigate more about each from internet sources.

[a] Enterprise Data Warehouse and Population Health Data Analytics/Business

Intelligence Capabilities-(ability to aggregate clinical and insurance claims data,?model?payer reimbursement contracts, and evaluate health care utilization and disease/condition?cost?trends)

[b] Home monitoring system (for use with patients in a new “Hospital at Home” Medicare contract)

[c] Linear Accelerator advanced cancer treatment equipment ($5 mil Varian Truebeam Radiation system)

3. VALUATION (Medfield?Pharmaceutical?session)

Consider the current sale of Oak Street?Health to CVS?as?discussed?in the?attached?article?in Appendix?B.

[a] How can you explain the purchase price by CVS of $10.6 billion (i.e., $39 per share--a 50% premium over the prior equity value of Oak Street) when they are still losing $200 million each year?

[b] How can each site of Oak Street do so well when their customers are almost all covered by Medicare and Medicaid and come from largely disadvantaged populations?

[c] How can you determine a total market value for a firm like this and what is the source of

it? Would you buy more stock at the current price or sell what you have for $39 per share? Why?

4. INSURANCE (Kaiser-Permanente Obesity session)

Compare the decisions K-P made in the obesity program discussed?in that?case?discussion with the?investments we studied in the Seaman’s case.

[a] Specifically, how do the economics faced in the two cases differ? How would these conditions affect your decisions?

[b] Should the financial evaluation of a program (K-P Obesity) be essentially the same as what we did for the three types of physical investment for Seamans of differ in some ??material way? ?Explain?