During the current year, St.Mary's Hospital (a not-for-profit entity)earned, based on its normal billings rate, $1 million in patient service revenues.Many of these patients belong to a health plan that has an established pay schedule.Based on the specific services rendered to members of the plan, the hospital estimates that $.05 million will not be collectible from the plan or the patient.Some of the patients are Hospital employees.These employees are given a 50% discount on the services rendered.Employee discounts for the current year total $.01 million.Some of the patients are uninsured and the hospital estimates, that of the amount billed to the uninsured patients, $.2 million will not be collectible (bad debts).The amount of net patient service revenues for St.Mary's Hospital for the current year is

Question

Quizplus · Accepted Answer

The net patient service revenues can be calculated as follows:
Gross patient service revenues = $1 million
Less: estimated uncollectible amount from health plan and patients = $.05 million
Net patient service revenues after accounting for health plan = $0.95 million
Less: employee discount = $.01 million
Net patient service revenues after accounting for health plan and employee discount = $0.94 million
Less: estimated bad debts from uninsured patients = $.2 million
Net patient service revenues after accounting for all discounts and bad debts = $0.74 million
Therefore, the answer is C.

During the Current Year, St