2005 Fiscal Year Final Research Report Summary
Development of an alternative method of cost accounting for objectively estimating the indirect cost of each department and practice in hospitals.
| Project/Area Number |
16390147
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| Research Category |
Grant-in-Aid for Scientific Research (B)
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| Allocation Type | Single-year Grants |
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| Section | 一般 |
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| Research Field |
Medical sociology
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| Research Institution | Niigata University |
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Principal Investigator |
AKAZAWA Kohei Niigata University, Medical and Dental Hospital, Professor, 医歯学総合病院, 教授 (10175771)
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| Co-Investigator(Kenkyū-buntansha) |
TOYABE Shin-ichi Niigata University, Medical and Dental Hospital, Associate Professor, 医歯学総合病院, 助教授 (20227648)
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| Project Period (FY) |
2004 – 2005
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| Keywords | Cost accounting system / data collection / activity-based costing / cost driver reduction / cost accuracy / Hospital administration / Account / Finance |
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| Research Abstract |
【Objectives】
Activity Based Costing (ABC) is widely used to precisely allocate indirect costs to medical services in each department of a hospital. In the ABC method, the indirect cost in a department is divided among the medical services in proportion to the volume of "cost drivers", for example, labor hours and the number of hours of surgery. However, the workload of data collection of cost drivers can be time-consuming and a considerable burden if there are many cost drivers. The authors aim to develop a method for objectively reducing the cost drivers used in the ABC method.
【Methods】
In the allocation of the total indirect cost belonging to activities, cost drivers are used to determine the amount of cost invested with medical services (cost objects). A cost driver is assigned for each activity. We assume that activities and cost drivers used in ABC method is the best combination. Our method, that is, cost driver reduction (CDR), can objectively select surrogates of the cost drivers
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for each activity in ABC, from candidate cost drivers. Concretely, the total indirect cost of an activity is temporarily allocated to the cost objects using each candidate of cost drivers. The difference between the costs calculated by each candidate and the proper cost driver used in ABC is calculated to evaluate the similarity by the evaluation function. To illustrate the procedure of the CDR, we performed actual cost accounting of indirect cost allocation for laboratory tests.
【Results】
We estimated the cost of laboratory tests using our method, and revealed that the number of cost drivers could be reduced from seven in the ABC to four. Similarly, the results of cost estimation obtained by our method were as accurate as those calculated using the ABC.
Conclusions : Our method provides two advantages compared to the ABC method : (1)it provides results that are as accurate as those of the ABC method, and (2)it is simpler to perform complicated estimation of hospital costs. Once we reduce the number of cost drivers by applying our method to the data for the ABC method, we can easily perform data collection and cost accounting using fewer cost drivers after the second time of costing. Less
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