The basic ABC system is tranformed to include revenues. Using Table 2 below, dis
ID: 2491142 • Letter: T
Question
The basic ABC system is tranformed to include revenues. Using Table 2 below, discuss the differences in the process costs for the FMMG Medical Group and MCCS and the database average. Compare the patient encounters of each business model and the database average per surgeon. How are the different models used in the two practices apparent in these comparisons?
Total Cost of Processes MCCS FMMG Database Avg Process Abbvn Service Patients in the Office $39,970 $347,045 $212,046 SPO Service Patients in the Hospital $94,018 $186,764 $173,192 SPH Obtain Insurance Authorization $94,743 $45,930 $28,991 Auth Billing $20,487 $64,950 $26,234 Bill Collect Payments $17,979 $54,199 $26,234 Collect Resolve Collection Disputes $13,799 $58,333 $32,792 Disputes Maintain Medical Records $43,342 $69,705 $57,133 MMR Schedule & Coord. Surgeries $121,783 $30,915 $36,415 Sched Provide Info to 3rd Parties $23,805 $16,989 $17,230 3rd pties Teaching & Research $0 $0 $297 T&R Maintain Prof. Education $51,411 $31,118 $37,163 MPE TOTAL $521,337 $905,948 $666,845 Total Reimbursement Processes $147,008 $223,412 $133,369 Reimb Sustain & Manage Business $191,547 $153,906 $121,203 Sust Bus Maintain Facility $59,429 $223,180 $121,203 Facility Number of MDs 4 3 4.1 Number of no-charge office visits 1,424 1,188 1,038 # of charge office visits 288 1,975 422 # of charge hospital visits 530 779 97 # of surgeries/procedures 1,312 639 727 Indirect cost/unit: No-charge office visit $41 $139 $190 Charge office visit $82 $169 $227 Charge hospital visit $26 $45 $66 Surgery $324 $581 $505Explanation / Answer
A Brief on process costing process have been mentioned Process costing is an accounting methodology that traces and accumulates direct costs, and allocates indirect costs of a manufacturing process. Costs are assigned to products, usually in a large batch, which might include an entire month's production. Eventually, costs have to be allocated to individual units of product. It assigns average costs to each unit, and attempts to measure individual costs of production of each unit. Process costing is usually a significant chapter. it is a method of assigning costs to units of production in companies producing large quantities of homogeneous products. Table 2 has not been attached in the question. Please attach the it to enable comparision answer for comparison
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