TY - JOUR
T1 - Applying activity-based costing to the nuclear medicine unit
AU - Suthummanon, Sakesun
AU - Omachonu, Vincent K.
AU - Akcin, Mehmet
N1 - Copyright:
Copyright 2008 Elsevier B.V., All rights reserved.
PY - 2005/8
Y1 - 2005/8
N2 - Previous studies have shown the feasibility of using activity-based costing (ABC) in hospital environments. However, many of these studies discuss the general applications of ABC in health-care organizations. This research explores the potential application of ABC to the nuclear medicine unit (NMU) at a teaching hospital. The finding indicates that the current cost averages US$236.11 for all procedures, which is quite different from the costs computed by using ABC. The difference is most significant with positron emission tomography scan, US$463 (an increase of 96%), as well as bone scan and thyroid scan, US$114 (a decrease of 52%). The result of ABC analysis demonstrates that the operational time (machine time and direct labour time) and the cost of drugs have the most influence on cost per procedure. Clearly, to reduce the cost per procedure for the NMU, the reduction in operational time and cost of drugs should be analysed. The result also indicates that ABC can be used to improve resource allocation and management. It can be an important aid in making management decisions, particularly for improving pricing practices by making costing more accurate. It also facilitates the identification of underutilized resources and related costs, leading to cost reduction. The ABC system will also help hospitals control costs, improve the quality and efficiency of the care they provide, and manage their resources better.
AB - Previous studies have shown the feasibility of using activity-based costing (ABC) in hospital environments. However, many of these studies discuss the general applications of ABC in health-care organizations. This research explores the potential application of ABC to the nuclear medicine unit (NMU) at a teaching hospital. The finding indicates that the current cost averages US$236.11 for all procedures, which is quite different from the costs computed by using ABC. The difference is most significant with positron emission tomography scan, US$463 (an increase of 96%), as well as bone scan and thyroid scan, US$114 (a decrease of 52%). The result of ABC analysis demonstrates that the operational time (machine time and direct labour time) and the cost of drugs have the most influence on cost per procedure. Clearly, to reduce the cost per procedure for the NMU, the reduction in operational time and cost of drugs should be analysed. The result also indicates that ABC can be used to improve resource allocation and management. It can be an important aid in making management decisions, particularly for improving pricing practices by making costing more accurate. It also facilitates the identification of underutilized resources and related costs, leading to cost reduction. The ABC system will also help hospitals control costs, improve the quality and efficiency of the care they provide, and manage their resources better.
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U2 - 10.1258/0951484054572538
DO - 10.1258/0951484054572538
M3 - Article
C2 - 16102243
AN - SCOPUS:23844454991
VL - 18
SP - 141
EP - 150
JO - Health Services Management Research
JF - Health Services Management Research
SN - 0951-4848
IS - 3
ER -