Current issues in hospital cost accounting methods

Abstract

To create meaningful cost reports, a better definition of cost and range of costs is needed in order to reduce current uncertainties that still occur in conferences and papers regarding hospital cost accounting.Hospital Cost Accounting Committee (HCAC) of Japan Society for Health Care Management (JSHCM) has continued to discuss this critical issue in hospital cost accounting systems in order to better facilitate communication between stakeholders.

The society recognizes that meaningless cost report, unclear definitions of cost, and lack of range of costs caused confusions and misunderstandings.

Therefore, the committee sought to clarify these issues. In order to make meaningful and useful cost reports, members of HCAC suggest that a committee be formed to expressly define the object of cost and range of costs based on currently available Hospital Financial Reporting Standards. This initiative will help to ameliorate current problem in reporting. After instituting and sharing this basic information among stakeholders, cost reporters will be able to better analyze data. As an example, with a common definition of total cost, a medical cost and administrative cost will become more clearly defined and, thus, give more details of hospital condition from a cost accounting perspective.