Exercise 715 The following list includes activities that are

Exercise 7-15 The following list includes activities that are performed in a physician\'s office. Classify each activity as value-added or non-value-added by selecting an \"X\" from the appropriate drop down menu. For each non-value-added activity, state whether it can be eliminated without jeopardizing the office\'s operations. Value-Added Non-Value-Added Can be Eliminated a. Patient checks in. b. Medical records clerk pulls patient\'s medical records c. Patient waits in reception area to be called to exam room. d. Nurse takes vital signs (temperature, blood pressure, height, weight) e. Patient waits in exam room. f. Doctor completes examination g. Billing clerk files insurance claim. h. Accounting clerk processes patient payments. i. Accounting clerk resolves billing errors Click if you would like to Show Work for this question: Open Show Work

Solution

a). Value-added Activity. Here the arrival of patients will ensure the inflow of resources or money hence can be said as a Value-added Activity.

b). Nonvalue-added activity. It is a routine process but does not generate revenue.
This activity cannot be eliminated.

c). Nonvalue-added activity. It is a process as patients have to wait for their turns but does not ensure revenue generation.
This activity cannot be eliminated.

d). Value-added activity. Here nurse is provided services which will generate revenue and patients are charged for those services.

e). Nonvalid added activity. Waiting time of patients in exam room will not ensure generation of revenue or providing of services which will result in revenue.
This activity can be eliminated by managing patient and physician\'s time and synchronising then so that patient doesn\'t have to wait even in the exam room also.

f). Value-added activity. Based on services of doctors patients are charged which will result in revenues.

g). Non-value added activity. Filing of insurance claims is a not a value addition to the services so that revenue will inflow. Revenues are already generated, it is process of receiving those revenues and hence non value added.
This activity cannot be eliminated because it is a process of collecting the revenues.

h). Non-value added activity. Filing of insurance claims is a not a value addition to the services so that revenue will inflow. Revenues are already generated, it is process of receiving those revenues and hence non value added.
This activity cannot be eliminated because it is a process of collecting the revenues.

i). Non-value added activity. Filing of insurance claims is a not a value addition to the services so that revenue will inflow. Revenues are already generated, it is process of receiving those revenues and hence non value added.
This activity can be eliminated by ensuring billings are done correctly in first time and using automation which will reduce the errors and activity can be eliminated.