Introduction to Costing of Inpatient Care Services

At present era, one of the burning concerns of most of the developing countries is healthcare financing; the sources of finance for health services, the ability to maintain past funding levels, rational allocation of resources, and the efficiency of health services delivery at the individual level. Hospitals commonly account for 50 to 80 percent of government recurrent health sector expenditure and use a large proportion of the most highly trained manpower, i.e., healthcare personnel. It is the responsibility of hospital administrators/ managers to rationally allocate budget amongst various hospital heads based on costing exercise. Costing in healthcare helps hospital administrators to know how to efficiently utilise the limited resources in order to get maximum output, i.e., patientcare. Some of the basic reasons for having cost information are to improve efficiency, increase effectiveness, enhance sustainability, and improve quality and more patient satisfaction. Hospital Costing data can be used for two primary purposes, relative to time: for the present and for the future. It can be used to assess the current situation of a hospital, such as for assessing its efficiency, determining the effectiveness of the hospital, reviewing its priorities, and setting of prices. Cost information may also be used for the future: making cost projections, budgeting, and scenario planning with emergency situations. With the above background, a cost analysis study of inpatient care services was conducted at a large tertiary care teaching institute at New Delhi, India with the objectives 1) to identify the major cost centres in hospitals, 2) to determine the cost per bed per day, incurred by the hospital and 3) to determine expenses incurred by patients during hospital stay per day. This study helped us to know that how much it costs in terms of cost per bed per day to treat in-patients in selected specialties and in a general ICU as well which would help administrators to allocate resources, accordingly [1].