Government and Insurance Case Study Essay Example

Government and Insurance Case Study Essay Example Government and Insurance Case Study Essay Government and Insurance Case Study Essay The claims that the government insurance are receiving tend to be much higher than what those who cash and carry are required to pay. The government is having to pay significantly higher claims for members of medicare and Medicaid than those who do not use government insurance and pay with cash. The government feels they are being taken advantage of in this system and have imposed laws that now forbid that a companys’ claims be in excess of 120% of what the ordinary, or usual, charges would be without good cause. Potentially, government programs reimbursement amounts exceed the retail sales price for products because customers are more restricted and requires an extensive number of internal processes and procedure. The reimbursement amounts are set by the program entity. The process of selling goods involves additional mandated by law consideration beyond the normal cash and carry process, including the processing of insurance claims and substantiation of product delivery. Another potential could be because of the nondurable medical supplies, and how the process is cumbersome as the products are supplied to customers on a monthly basis. We do not think that the reimbursement rate for this company is substantially in excess. In order to comply with all of the governments requirements, there are significant operating expenses that must be incurred to get the products to where they need to be. Looking at TABLE 6, you can see that the product cost per unit is significantly higher for the product s sold to the government than the products sold to the cash and carry customers because of these extra operating expenses that are incurred. For this reason, this company should have good cause to charge a higher percentage for reimbursement rate in order the allow the business to operate at a profit and make it worth while to continue providing products for these customers. Although the numbers are not given to see what the company charges for :