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Activity Based Costing (ABC) for HPM and TRENDSTAR |
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Where does Activity Based Costing (ABC) really come into play in hospital cost accounting? One could argue (as we do in other related articles) that much of what we do now is already ABC-compliant. True, but there is still a gap that ABC methods could fill, if only the data were readily available.
The gap is in allocating areas like clinical chiefs, residents, clinical programs and service line specific costs. This can be a significant part of hospital overhead costs, but most of the time these costs are allocated on aggregate overhead statistics instead of being directed to the patients and service lines that were the consumers of these services.
Yardley is offering a new solution to this need that allows you to create your own patient level allocation statistics, working within your existing Trendstar or HPM costing framework. Departments that you formerly treated as overhead become direct departments, allocated on volume and standards of activity determined by patient specific charactistics. For example, cardiac surgery programs follow only your defined cardiac surgery patients based on patient days, direct costs or other measures you choose. using this approach, the amount of overhead cost allocated by general methods will fall and your credibility isnshowing how these costs are allocated will improve significantly.
The solution will work for both HPM and Trendstar users. Please contact Yardley for more information. |
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