The Impact of Healthcare Reforms on Hospital Costing Systems Essay

1337 Words Jan 26th, 2016 6 Pages
The Impact of Healthcare reforms on Hospital Costing Systems

The costing systems implemented in hospitals has been the same for a while now. It’s worked and has been easily allocated based off of averages from previous years. Now as times change so will the costing systems for hospitals in order to get the most beneficial cost-reductions to them as well as improve on efficiency. This article looks into how accountants for hospitals can redesign, reposition, and re-implement costing ideas to allocate on a per-unit of care basis (Selivanoff, 2011). We’ll take a look at two ways for accountants to prepare for these reforms and five steps to adjusting the costing systems in place. In the hospital costing system accountants want to
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The article takes a deeper look into the five strategic approaches it will take to better a costing system within the hospital. First it seeks to switch from the strategic model to a more operational model. To explain, the strategic model takes the previous year’s standards of costing and then implement them for budgeting to the next year and so on. Now they are looking in to the operational model that goes on a month to month costs of services. Though stressful on accountants to provide this information, it creates a more accurate depiction of how the company is running. As exampled for the article, it looks at inventory as its main target. Rather than having an annual inventory check like they do and expensing all missing products it turns to a more organized system to look at inventory quarterly and accurately see what resources are being used (Selivanoff, 2011). This saves the company thousands instantly by looking closer at direct materials used by doctors. It ties in with the previous example of allocating resources used as a bill to the patient instead of average service times being the costing method of charging people such as a 30 minute visit costing a standard $250. The second method adjustment is going from standard costing to job costing. This is inevitably being done as other changes are made. It takes away the set prices

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