Activity Based Costing in Health Institutions: An Application in Gynecology Clinic of a Public Hospital

OpenAlex İngilizce

Objective: The aim of the study is to calculate the unit cost of normal labor and cesarean section using Activity Based Costing (ABC) method that is one of the contemporary methods that provide accurate cost allocations for clinical procedures. Material and Methods: Financial accounting and other data are obtained from a public hospital operating in Samsun for the year of 2014. In the study unit costs for normal labor and cesarean section are analyzed using ABC method. Unit costs that are calculated for normal labor and cesarean section are compared with billed amount. Results: Unit costs for normal labor and cesarean section are calculated according to ABC methods and results are as follows; unit costs for normal labor and cesarean section are correspondingly 814.66 TL(Turkish Liras) and 1.274.21 TL. Finally cost figures for normal and cesarean labors are compared with billed amounts to patients. According to data obtained from hospital the billed amount for normal labor is 539 TL which is below the cost calculated (814.66 TL) in the study. The difference is more dramatic for cesarean labor. The billed amount 618 TL is far below the cost figure calculated in the study which is 1.271.21 TL. Lastly normal labor and cesarean section unit costs that are calculated according to ABC method are compared with price lists in Communique on Healthcare Practices (Sağlık Uygulamaları Tebliği-SUT [HIN]) Conclusion: According to this study, it is determined that there are differences between the unit costs calculated by ABC method of normal and cesarean deliveries and repayment amounts. It is concluded that hospital is incurring losses due to underpricing of normal and cesarean labor operations below their calculated costs. Use of the ABC method in the calculation of the costs of clinical procedures will enable health institutions managers to make more accurate financial planning and financial desicions. In addition, it will increase competitiveness through higher quality service provided to patients.