Taking a Step Forward in Public Health Finance

Abstract

In its 2012 report on the current and future states of public health finance, the Institute of Medicine noted, with concern, the relative lack of capacity for practitioners and researchers alike to make comparisons between health department expenditures across the country. This is due in part to different accounting systems, service portfolios, and state- or agency-specific reporting requirements. The Institute of Medicine called for a uniform chart of accounts, perhaps building on existing efforts such as the Public Health Uniform National Data Systems (PHUND$). Shortly thereafter, a group was convened to work with public health practitioners and researchers to develop a uniform chart of accounts crosswalk. A year-long process was undertaken to create the crosswalk. This commentary discusses that process, challenges encountered along the way and provides a draft crosswalk in line with the Foundational Public Health Services model that, if used by health departments, could allow for meaningful comparisons between agencies.

The Foundational Public Health Services as a Framework for Estimating Spending

“…For records that were deemed other health/ services (e.g., community healthcare clinics or behavioral health care), the project team created a standardized set of "other health (Figure 2). 6,16,17,24,25 Environmental health expenditures were coded according to the Organisation for Economic Cooperation and Development and WHO "A System of Health Accounts" framework. Hence, environmental health determinations were based on the Organisation for Economic Co-operation and Development and WHO premise of preventive services, such as permitting education and regulation as a public health (FPHS) activity, whereas remediation and natural resources preservation were categorized as "other services."…”

“…espite efforts to assure a high-quality public health system, governmental public health service provision across the nation is inconsistent, hampered by insufficient funding, workforce, and technology. [1][2][3][4][5][6] To that end, and in response to a 2012 National Academy of Medicine (NAM) report, For the Public's Health, Investing in a Healthier Future, 2 the Foundational Public Health Services (FPHS), a model for defining and costing public health services, was developed. 4 The NAM's report highlighted the chronic underfunding of public health services and the challenge of presenting a clear picture of public health services needed in all local communities.…”

“…4 Building on these efforts, approaches to cost estimation were formulated and a uniform chart of accounts crosswalk was developed for comparison of spending across health departments. 6,7 The FPHS model is a conceptual framework describing the capacities and programs that state and local health departments should be able to provide to all communities and for which costs can be estimated. 8 Additionally, health departments should have the capacity for additional important programs and activities specific to the needs of their individual communities.…”

New development: The development of standardized charts of accounts in public sector accounting

“…By using a CoA, financial data can be uniformly sorted and aggregated into operating classifications, such as product lines, cost centres, operational functions, or other categories specific to a particular organization. Therefore, some literature highlights the use of uniform CoAs as a foundation for cost accounting, allowing, in areas like public health activities, information on cost and benefits, uses and outcomes accruing from public health system subsidies, to be used for planning and analytic aims (Honoré et al, 2015). Moreover, such literature also underlines how the lack of uniformity in CoAs makes it difficult to compare systems and programmes (Cartwright, 2008).…”

A Uniform Chart of Accounts: Strengthening Public Health Practice and Research Through Standardized Financial Data

“…A 2012 report commissioned by the National Academy of Medicine (NAM) called for development of a public health UCOA to provide public health leaders and policy makers with comparable, detailed financial data necessary to inform practice and drive collective action. 3 Honoré and colleagues 10 described US public health accounting systems as decades behind other public and health care sector reporting standards and blamed this, in part, on the lack of a standard for comparisons across varied public health systems.…”