Blue Point Healthcare Case Study

Blue Pointe Healthcare- Premium Development

Introduction
Blue Point Healthcare is a non-profit healthcare coverage provider that has shown its interest in providing health coverage to a big consortium consisting of 75000 employees. The health coverage would provide the employees of the consortium with coverage on the health treatment received by them on a routine as well as on emergency occasions. The primary healthcare needs, the acute health issues, the surgical costs incurred, outpatient procedures undergone and the emergency treatment undergone by the employees would all be covered under the health coverage plan (Elmendorf, 2009). Thus it was required by the Blue Point Healthcare Company to present its bid of providing
Blue Point Healthcare has more than one million enrollees and operates in as many as 25 different plans in which the company provides healthcare services. The company has also shown its interests to offer health care coverage to a consortium consisting of 75000 employees. For this reason Blue Point health has presented its bid for the premium amount that is required to be paid by the consortium for health coverage of its employees. The bid for the health premium has been presented on a per member per month basis (Harris, 2011). The bid also include the coverage of individuals and their families. It has been assumed that 1 family would consist of 3.5 members on an average. In order to divide the allocation of premium, 12000 members and 18000 families have been considered in this bid. In scenery the specific premium rates, Blue Pointe ensured that the total premiums collected, which would be paid by both the employer and employees, equal the estimated total calculated using the PMPM rate. Thus, 75,000 × Total PMPM amount must equal (12,000× Single premium) + (18,000× Family premium).The total value of premium of the all the employees in the consortia for the proposed health coverage has been represented in the table given
The base value of the expenses per member per month under the various categories of health care treatment has been allocated at first. The base value is then adjusted with the co-payment factors of the cost incurred and the utilization of the healthcare facilities. The co-payment factors have been fixed on the basis of information provided by the consortium and the historical expenses on health coverage to individuals and their families. The base value of the expenses per member per month has been multiplied by the co-payment factors in order to obtain the adjusted values of the expenses. By adding the various medical and non-medical expenses, the total premium value has been found for the employees of the consortium. In designing the presentation on the bid for health coverage, the significance of the co-payment on the payment of premium has been considered. The low value of the premium could be obtained by increasing the co-payments while an increased premium value would be supported by lesser co-payments. The bid presented to the employees of the consortium was designed by taking into consideration the average health needs of the employees and the average capability of the paying the designed