When measuring performance, is there a recommended practice (standard) for including or excluding depreciation, bad debt and interest?
Should they be considered “above or below the line?” 2). How should rebates and GPO share-backs earned from supply purchases be treated when measuring benchmark performance? V.A. & R.S. The answers to your questions are as follows: (1) exclude bad debit, depreciation and interest from your benchmarking formula, and (2) all rebates and share-backs should be deducted from your supply cost as well. Also, you might want to take advantage of our no cost no obligation Supply Savings Benchmarking Scorecard www.strategicvalueanalysis.com that will give you the answers that your CFO and you are looking for to determine your supply expense as a percentage of revenues without breaking into a sweat Good luck, Bob Yokl, Sr. Chief Value Strategist Strategic Value Analysis In Healthcare 800-220-4274 bobpres@strategicvalueanalysis.com P.S. If anyone else has a burning question that you would like me to answer, please call or e-mail me and I would be delighted to answer. There Is Still Gold In them Tha
