What is the break-even volume of patients undergoing the surgery for DRG 3?Suppose a managed care organization (MCO) offers to generate 500 operations a year but offers to pay only $300 per operation. Should we agree to this arrangement?
1. Average versus incremental costing. Suppose a hospital had the following fixed and variable costs for its operating room (OR): Variable costs per operation Fixed costs per year Personnel $150 Depreciation $100,000 Supplies 20 Administration 120,000 Laundry 30 Other 80,000 Other 50 Total $250 Total $300,000 a. Complete the following chart: Costs Volume Fixed Variable […]