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  Activity Based
Cost Accounting

Activity Based Cost Accounting

In order for each practice to be profitable under Capitation, the practice needs to determine the unit cost of delivering a service, by CPT code. The basis of Activity Based Cost Accounting services include:

  • Compiling a complete and appropriate list of service by CPT code
  • Determining the resources consumed to provide these services, ie. appointment scheduling, medical record preparation, billing and account receivable, work value of physician and employees, overhead expenses, risk factors, and then compiling the information to determine the cost of each unit of care.