Evaluating the Financial Impact of Coding Backlogs
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LiveWell Medical office has been struggling with coding backlogs, and you are analyzing the impact of the coding backlogs for the CFO. It is necessary to consider the impact of backlogs on the total monthly expenses (Table C) which are paid out no matter what the income is at LiveWell Medical. Your research reveals that the backlog has varied from completing 85% of the monthly workload to 95% of the monthly workload. You pull average office volumes (Table A) and get average income for all the billables. (Table B.) This allows you to calculate office monthly earnings with varying amounts of backlogs.
TABLE A TABLE B TABLE C
LiveWell Medical Office LiveWell Medical Office Monthly Expenses =
Billable Type Average Volume Office Services Office Receivable $42,261
CBC 221 CBC $20.00
Prothrombin 41 Prothrombin Time $51.00
Basic Metabolic 211 Basic Metabolic Panel $38.00
Office Visit 560 Office Visit $70.00
Xray 74 Xray $28.00
1. Use Tables A and B to calculate office income if all the accounts are coded. This is your MAX income Potential. Insert a table below with your calculations. Always include column and row titles.
Billable Type Office Receivables
CBC $4,420
Prothrombin $2,091
Basic Metabolic $8,018
Office Visit $39,200
Xray $2,072
Total $55,801
2. Next, calculate income if 85% of the accounts are coded, then 90% and finally 95%. Insert a table below with your calculations. Always include column and row titles.
Total (85%) Total (90%) Total (95%)
3. Next, calculate the lost income potential when 85% of the accounts are coded, then 90% and finally 95%. Insert a table below with your calculations. Always include column and row titles.
85% lost income total 90% lost income total 95% lost income total
3. Finally, compare monthly expenses to income potentials calculated above in step #2 and appraise the financial impact of a coding backlog. Prepare a summary below for the CFO and include useful statistics calculated here to support your appraisal.
Appraisal and Summary:
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