Cost Accounting, Management Control, and Planning in Health Care

Decision-Support Systems in Health Care: Factors Influencing the Development and Transfer of Technology

“…); this information was not available in the standard hospital accounting systems. Perhaps more fundamental, however, was the management team's concern to have cost information about two types of hospital products: "intermediate products" (e.g., a laboratory test, an x-ray, or an hour of operating room time) and "end products" (e.g., different types of patient cases) (16). The team believed that while improvements could be made in the efficiency of the production of intermediate products, the true business of the hospital was not the production of laboratory tests or nursing days but rather the treatment of patients.…”

“…Today, Transition I retains the essential elements of the system developed for NEMC in the early 1980s ( Figure 1). The intermediate product management system (now called Department Cost Manager) allows hospitals to define intermediate products; simulate changes in standard unit costs, departmental budgets, and staffing; perform variance analysis; and analyze marginal costs (16). The case-mix management system (Clinical Cost Manager), combined with the Clinical Financial Planner module, is now called Product Line Manager.…”

“…The case-mix management system (Clinical Cost Manager), combined with the Clinical Financial Planner module, is now called Product Line Manager. This module allows hospitals to create a patient-level database; identify end products (patient-care groupings); develop standard resource protocols; and model alternative assumptions about cost, revenue, and activity (16). A new subsystem has been added to Transition I to facilitate the definitions of costs by type (e.g., fixed versus variable) and to help build budgets.…”