What do you think accounts for the difference in costs between the two hospitals?
Dr. Mallory practices at your hospital and your competitor. Presented below are datafor DRG 469 (major joint and limb reattachments,(lower extremity) with MCC that reflects practice patternsfor Dr. Mallory at the two hospitals: Your Hospital Competitor ____________________________________________________________ Discharges 150 90Average age 68 50Length of stay 4.4 4.1Average cost $10,550 $7,108Nursing cost 1,998 1,208Ancillary cost 8,552 5,900Operating room cost 2,405 2,158Lab cost 836 484Radiology cost 277 191Medical Supplies cost 3,022 1,690Pharmacy cost 857 335Other costs 1,156 1,042Question: What do you think accounts for the difference in costs between the two hospitals?2. Activity:Calculate the contribution margin per case based on the following information:(a) Variable cost per case $2,000.(b) Fixed cost per period $200,000.(c) Price per case $4,800.
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