financial manag w6
4
Rachel
Activity-based costing can be used to mitigate rising costs and the change in patient perception through data collection and transparency. Health Catalyst CORUS Suite is a tool that is used and aides in these issues and these problems are managed because it uses the analytics engine and models to provide readily available, accurate, integrated, detailed, and external data (Quesado, 2021). CORUS collects data from a variety of sources, such as EHR and allows the patients to be assigned direct costs based on their utilization. With this detailed expense data, the expenses can be monitored for where improvements need to be made, where the money is being spent and recognize opportunities by analyzing the data and creating pathways to minimize excessive clinical costs (Quesado, 2021). Activity based costing puts a cost per patient by establishing procedures to offer for specific treatment and outcomes. With this information the patient has clarity and transparency which then leads to building trust.
Other methods do not offer the level of information and precision required to make decisions that would allow it to address the challenges of providing transparency and building trust. With activity-based costing and its ability to conduct data collection and integration this can streamline and optimize cost allocation mechanisms to shorten the process which would save costs and time and provide transparency for the patient (Urman, 2020).
References
Urman, R. D. (2020). Advances in value-based healthcare by the application of time-driven activity-based costing for inpatient management: a systematic review. Value in Health, 23(6), 812-823.
Quesado, P. (2021). Activity-based costing (ABC) and its implication for open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 41.
Shenita
Activity-based costing extensively provides a more accurate method of costing in healthcare organizations which systematically leads to more accurate pricing decisions. In this context, activity-based costing leads to accurate pricing decisions, especially when it comes to identifying different prices in healthcare services. It leads to an increment in the understanding of both cost drivers and overheads and makes costly and non-value activities more visible. This will allow healthcare management to reduce all the issues that are not helpful in the organization (da Silva Etges et al., 2019). Also, cost accounting in a healthcare organization is used in the determination of each product or service used to deliver healthcare service to the patient, and this will provide detailed information that will be used in decision-making and analytics. As such, it will pave the way for healthcare organization on how it can improve the services and generally improve outcomes. For instance, the cost of an X-ray is made up of overhead, depreciation, supplies, and labor. When such issues are systematically combined with other charges on patients’ records, there would be an emergence of a complete picture (Parikh et al., 2020). The available data will then be compared to the payer rates to decide whether the cost agrees with the anticipated outcomes. This data will be so helpful in ensuring smooth facilitation of the staff decisions and exploring different ways of improving outcomes in healthcare organizations. The patient will have a positive perception as they perceive how lenient and effective services are in the healthcare organization.
References
da Silva Etges, A. P. B., Cruz, L. N., Notti, R. K., Neyeloff, J. L., Schlatter, R. P., Astigarraga, C. C., ... & Polanczyk, C. A. (2019). An 8-step framework for implementing time-driven activity-based costing in healthcare studies. The European Journal of Health Economics, 20(8), 1133-1145.
Parikh, N. R., Chang, E. M., Kishan, A. U., Kaprealian, T. B., Steinberg, M. L., & Raldow, A. C. (2020). Time-driven activity-based costing analysis of telemedicine services in radiation oncology. International Journal of Radiation Oncology* Biology* Physics, 108(2), 430-434.