1. Mayo Clinic and Mount Sinai Health System allocate their healthcare operating costs using activity-based costing. The following table summarizes the costs and cost drivers:

Department	Mayo Clinic Total Cost ($)	Cost Driver	Cost Driver Quantity	Mount Sinai Total Cost ($)
Emergency Room	$4,500,000	Number of visits	45,000 visits	$4,000,000
Surgery	$6,000,000	Surgery hours	75,000 hours	$5,200,000
Pediatrics	$3,000,000	Number of patients	50,000 patients	$2,800,000
Total	$13,500,000			$12,000,000

• Mayo Clinic had 50,000 emergency room visits, performed 80,000 surgery hours, and treated 55,000 pediatric patients.
• Allocate healthcare operating costs per visit, per surgery hour, and per patient for Mayo Clinic and Mount Sinai using activity-based costing.
• Discuss how differences in costs per patient impact the operational efficiency and patient care quality at Mayo Clinic and Mount Sinai Health System.