You have recently received a call from Hospital ABC asking for a detailed budget
ID: 2398117 • Letter: Y
Question
You have recently received a call from Hospital ABC asking for a detailed budget proposal. Hospital ABC is thinking about outsourcing their coding processes to your consulting company. Hospital ABC currently has 100 IP discharges and 200 OP discharges a month and is expecting that number to increase by10% over the next year.
Create a detailed budget for the next year which includes at least the following items:
Capital expenses – indicate any capital needs and cost
Operating expenses – indicate any operating needs and cost
Staffing expenses – indicate number of coding staff needed and costs (HINT: Also, think about supervisory staff or clerical staff that may be assigned to multiple clients as support staff)
Budget variances - things that might happen to increase or decrease the amount
Information you will need
Encoder fee is $1,000 per quarter per computer
3% of charts are audited quarterly
Salaries: Auditor - $32.00 hour
IP Coder - $28.00 hour
OP Coder - $25.00 hour
Benefits is an additional 25% of total salary
NOTE: You may have to determine additional expenses such as computers, travel expenses, or overhead expenses. It will be up to your company to determine these figures.
Explanation / Answer
Particulars Budgeted Quantity Budgeted Cost IP Discharges 100 OP Discharges 220 Capital Expenses (W.N.01) 40,000.00 Encoder fees. $1000 per quarter 4,000.00 Operating Expense: a. Salary to Auditor 3,200.00 b.IP Coder 2,800.00 c.OP Coder 5,500.00 Other Benefits. 25% of (a+b+c) 2,875.00 Total budgeted Costs 58,375.00 Working Notes (W.N.01) Capital Expenses Assumed that 4 computers are purchased @ 10,000 per Computer
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