An Auditor reviewed 25 oral surgery insurance claims from a particular surgical office determining that the mean out of pocket patient billing above the reimbursed amount was $275.66 with a standard deviation of $78.11. (a) At the 5 percent level of significance, does this sample prove a violation of the guideline that the average patient should pay no more than $250 out of pocket? State your hypotheses and decision rule. (b) Is this a close decision?© BrainMass Inc. brainmass.com June 3, 2020, 11:12 pm ad1c9bdddf
a) We will perform a t-test
Null hypothesis: The average out of pocket expense for oral surgery is $250
Alternative hypothesis: The average out of pocket expense for oral surgery is more then $250
Our formula would be:
our cost - ...
The solution examines an auditors review for surgery insurance claims. A hypothesis and decision rules are determined.