DLM (ASCP) Exam Study online at https://quizlet.com/_8xyf00 1. Project Volumes (forecasting stage) based on expert opinion, stats, historical data, shifts in patient mix, changes in medical staff composition, changes in inflation/reimbursement ratws, expansion/cutbacks, population fluctuations based on economy 2. Steps to creating a budget 1. project volumes 2. convert volumes to revenue 3. convert volumes into expense requirements 4. Adjust revenue/ expenses as necessary to meet budget margin 3. gross revenue Rates x Production Unit (Billable test volume) 4. Expenses salaries/wages, reference service, instrument lease, maintenance contracts, education/travel 5. Financial Statements convey the financial status of an organization 4 main types - income statement, balance sheet statement of changes in equity and statement of cash flows. 6. income statement summarizes the operations of an organization with a focus on its revenues, expenses, and profitability. contains operational results over a period of time. 7. depreciation noncash charge against earnings on income statement that reflect the "wear and tear" on a business' fixed assets (property and equipment). loss of value 8. salvage value amount received when final disposition occurs at end of the asset's useful life. 9. annual depreciation (initial cost - salvage value)/ useful life 10. Profit net income -expense 11. cashflow net income + depreciation 12. Total Profit Margin Net income divided by total revenues. It measures the amount of total profit per dollar of total revenues. 1 / 28 DLM (ASCP) Exam Study online at https://quizlet.com/_8xyf00 13. fixed costs cost not related to the volume of services delivered (ex. facilities cost, lab admin, instrument leases, maintenance contracts) 14. variable cost directly related to the volume of services delivered (ex. supplies, labor costs) 15. Profit Analysis technique use to analyze the effects of volume changes on profit. can also be used to analyze effects of volume changes on costs. 16. Total Costs fixed costs + variable costs Variable costs = variable cost rate x volume 17. contribution margin difference between per unit revenue and per unit variable cost. gives the amount left to cover the fixed costs. after fixed costs are covered what's left contributes to the profit. 18. accounting breakeven Volume needed to produce zero profit. Revenues cover all accounting costs. Total Revenue (cost x volume) - Total Variable (variable cost rate x volume) - fixed costs = $0 19. economic breakeven occurs when all accounting costs plus a profit target are covered total revenue - total variable cost- fixed cost = profit 20. Surcharge/Cost Plus used for reference/send out testing. Determine cost of doing a procedure then add markup factor to get appropriate price. 21. weight value basis each test performed is assigned a weight based on cost of performing the test in relation to the procedure. 22. patient day factor the number of patients in a hospital on a given day. (average patient day/ daily census for the year) x 365 23. tests per patient days test volume/ patient days 2 / 28 DLM (ASCP) Exam Study online at https://quizlet.com/_8xyf00 24. revenue per test gross revenue/test volume 25. direct costs test-specific costs (Variable) examples - supplies, instrumentation, reagents, tech time 26. indirect cost remain constant examples - lab admin, medical records, house keeping, utilities, etc. (fixed/semi-variable) 27. unit costs total direct + indirect expenses 28. Employment cycle covers all stages in the process of employing staff: 1. recruitment and acquisition costs (pre-employment screen) 2. training/developmental costs (ongoing) 3. productive/operational periods 4. termination/separation of employee from institution costs 29. analyze labor costs institutional labor cost evaluation (employment cycle) technical evaluation of labor cost - assign labor costs to production activities that generate expenses. helps manager identify where efforts are being expended and productivity accounting and budgeting labor analysis - helps monitor staffing levels, productivity and management performance against budget objectives 30. preanalytical time specimen collection, prep, instrument 31. analytical time performing/resulting tests 32. post analytical time reporting and routine maintenance 33. total hours productive hours + nonproductive hours 34. productive hours actual worked hours includes overtime and training