MiniCase: The Metropolitan Medical Group (MMG)
The Metropolitan Medical Group (MMG) merged with the Oak Grove Medical Group (OGMG). The Oak Grove Medical Group has four offices and owns the medical office building where their imaging and radiology lab and physical therapy and diagnostic laboratory centers are located. Although the size of staffs in both practices is about the same, OGMG has a very different financial structure. Not only are their receivables a lot higher, but the aging of their receivables is much older. This has caused them to miss payments to their vendors, resulting in a higher accounts payable balance. Further analysis revealed that some of the doctors from remote offices have referred patients for laboratory tests and to specialists outside the practice when these same tests or specialists are available internally at other
offices.
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