Community Hospital has annual net patient revenues of $150 million. If these funds released by the lockbox arrangement can be invested at 8 percent, what will the annual savings be?

Community hospital has annual net patient revenues of $150 million.

The annual savings that Community Hospital can achieve with a lockbox arrangement are: Annual Net Patient Revenues of $150 million x (8% interest rate – 2,000 bank fee per month) = $10.2 million savings per year.