Issues in Cost Accounting for Health Care Organizations Book

	Preface
Pt. I	Cost Accounting Foundations	1
Ch. 1	Introduction to Cost Accounting	5
Reading 1-1	Reader's Forum: The Value of a Cost Accounting System	5
Reading 1-2	Understanding the Hospital Cost Accounting Process	8
Reading 1-3	The Human Element in Cost Accounting	14
Ch. 2	Cost Definitions	19
Reading 2-1	The Identification of Surgical Services Costs	19
Reading 2-2	Cost Finding for High-Technology, High-Cost Services: Current Practice and a Possible Alternative	24
Reading 2-3	Horizontal Accounting Considered for the Hospital Setting	37
Reading 2-4	Costing Out Nursing Services	44
Reading 2-5	Cost Accounting for Emergency Services	49
Ch. 3	Product Costing	56
Reading 3-1	Job-Order Costing in Physician Practice	56
Reading 3-2	Product Cost Analysis in the Clinical Laboratory	62
Reading 3-3	Product Costing for Health Care Firms	71
Reading 3-4	A Microcosting Approach	81
Ch. 4	Cost Allocation	85
Reading 4-1	The Distinction between Cost and Charges	85
Reading 4-2	Using Reciprocal Allocation of Service Department Costs for Decision Making	98
Reading 4-3	RVUs: Relative Value Units or Really Very Useful?	104
Reading 4-4	Alternative Costing Methods in Health Care	111
Reading 4-5	Accounting for the Move to Ambulatory Patient Groups	116
Reading 4-6	Cost Allocation in the Emergency Department	128
Ch. 5	Costing for Nonroutine Decisions	134
Reading 5-1	HMO Negotiations and Hospital Costs	134
Reading 5-2	Capitated Hospital Contracts: The Empty Beds versus Filled Beds Controversy	138
Reading 5-3	Privatization in Health Care Institutions	142
Reading 5-4	Considering Cost Effectiveness in the Hospital Setting	152
Reading 5-5	Cost-Effectiveness Analysis in Health Care	156
Ch. 6	Cost-Volume-Profit Analysis	165
Reading 6-1	Breakeven Analysis for Capitated Arrangements	165
Reading 6-2	Managed Care and Breakeven Analysis: A Clarification	167
Reading 6-3	Using Breakeven Analysis with Step-Fixed Costs	171
Reading 6-4	Alternative Contribution Margin Measures	176
Pt. II	Cost Accounting Information for Planning and Control	181
Ch. 7	Predicting Future Costs	183
Reading 7-1	Regression-Based Cost Estimation and Variance Analysis: Resolving the Impact of Outliers	183
Reading 7-2	The Learning Curve and the Health Care Industry	189
Ch. 8	Budgeting	197
Reading 8-1	The Financial Evolution of Hospitals and the Zero-Base Budget Approach	197
Reading 8-2	Zero-Based Budgeting for a Radiology Service: A Case Study in Outsourcing	205
Reading 8-3	Developing and Using a Budget Manual	211
Reading 8-4	Outcome Budgeting Shifts Focus to Meeting Objectives	215
Reading 8-5	Flexible Budgeting Allows for Better Management of Resources As Needs Change	224
Ch. 9	Flexible Budgeting and Variance Analysis	229
Reading 9-1	Physician Cost Variance Analysis under DRGs	229
Reading 9-2	A Contemporary Approach to Budget Variance Analysis: A Pharmacy Application	233
Reading 9-3	Rolling Budgets and Variance Reports	241
Reading 9-4	Statistical Cost Control: A Tool for Financial Managers	245
Ch. 10	Management Control	250
Reading 10-1	Developing a Planning and Control System for a Responsibility Unit	250
Reading 10-2	Cost Control Systems	253
Reading 10-3	Competitive Pricing Models for Intra-Hospital Services	259
Reading 10-4	Transfer Pricing in the Hospital-HMO Corporation	262
Pt. III	Additional Cost Accounting Tools to Aid in Decision Making	267
Ch. 11	Cost Accounting Ratios	269
Reading 11-1	Ratio Analysis: Use with Caution	269
Reading 11-2	Hospital Industry Cash Flow Ratio Analysis: A Sufficiency and Efficiency Perspective	278
Reading 11-3	Ratio Analysis for the Development Office of Health Care Institutions	283
Ch. 12	Measuring Productivity	289
Reading 12-1	Productivity Management: A Model for Participative Management in Health Care Organizations	289
Ch. 13	Inventory	300
Reading 13-1	Inventory Management System Reaps Savings for Department	300
Ch. 14	Dealing with Uncertainty	307
Reading 14-1	Decision Analysis and Capital Budgeting: Application to the Delivery of Critical Care Services	307
Reading 14-2	Expected Value Technique Useful in HMO Negotiations: Tool Helps Managers Consider Potential Outcomes of Bidding Process	315
Reading 14-3	Decision Making under Uncertainty: A Linear Programming Approach	324
Ch. 15	Information Systems for Costing	329
Reading 15-1	Saving Money throughout the Cost Accounting Installation Cycle	329
Reading 15-2	Cost Accounting Software Design	337
Reading 15-3	An Integrated Planning and Management Control System for Hospitals	342
Ch. 16	Performance Evaluation and Incentive Compensation	347
Reading 16-1	Measuring Segment Performance: New Ventures of Today's Innovative Hospital System Pose Evaluation Challenges	347
Reading 16-2	The Impact of Motivation and Incentive Programs on Financial Budgets	354
Pt. IV	Cost Accounting for the Year 2000 and Beyond	363
Ch. 17	New Approaches to Cost Accounting	365
Reading 17-1	Activity-Based Costing in the Operating Room at Valley View Hospital	365
Reading 17-2	Activity-Based Costing for Hospitals	371
Reading 17-3	ABC Estimation of Unit Costs for Emergency Department Services	385
Ch. 18	Total Cost Management: Measuring the Costs of Quality	393
Reading 18-1	Measuring the Costs of Quality	393
Reading 18-2	Total Quality Management: An Application in a Biomedical Laboratory	399
	Index	405
	About the Authors	421