ASSIT Health is a private health insurance provider. ASSIT receives large numbers of insurance claims every day. For each claim, ASSIT requires information such as date of service, procedure code, diagnosis code, place of service, type of provider and more including medical bills. ASSIT staff notice that a high number of insurance claims do not conform to the standards expected by the regulator. A quality controller at ASSIT, Samantha, is entrusted to investigate this claim. Samantha examines 100 randomly selected claims every day in the past 20 days to see if they conform to the required standards. Table 2 contains the data collected over the 20-day period.

Day

Number non-conforming

Day

Number non-conforming

1

12

11

4

2

8

12

16

3

16

13

18

4

0

14

8

5

14

15

4

6

40

16

0

7

12

17

6

8

2

18

8

9

10

19

12

10

7

20

10

(a)Set up the fraction non-conforming 3-sigma control chart for this process.

(b)What is the business process referred to in part (a)?

(c)Is the process in statistical control at the 3-sigma level? Give reasons for your answer.

(d)Day 4 and day 16 samples reveal zero non-conforming claims. How do you interpret these observations? Give reasons for your answer.

(e)Suppose no assignable causes can be found for all out-of-control points on the control chart drawn in Part (a). What center line and 3-sigma control limits should be used for process monitoring in day 21?

Suppose an assignable cause can be found for the out-of-control point for day 6 in the control chart drawn in Part (a). Further, no assignable causes can be found for all other out-of-control points. What center line and 3-sigma control limits should be used for process monitoring in day 21?