Determination of Cost Drivers through Activity Based Costing Method in Determination of Hospital Services Costs
 Meshkani Zahra¹, Reza Pour Aziz², Alipour Vahid³, Farabi Hero^1*, Mazdaki Alireza⁴,
Hakimi Narges⁵

1. Ph.D. Student in Health Economics, Health Management and Economics Research Centre, Iran University of Medical Sciences, Tehran, Iran
2. Associate Professor, Health Management and Economics Research Center, Iran University of Medical Sciences, Tehran, Iran
3. Assistant Professor, Health Management and Economics Research Centre, Iran University of Medical Sciences, Tehran, Iran
4. Ph.D. Student of Policy and Policy Management, Director of Finance, Iran University of Medical Sciences, Tehran, Iran
5. Ph.D. Student of Financial Management, Head of Affairs, Endocrine Research Center, Iran University of Medical Sciences, Tehran, Iran
*Correspondence: Health Management and Economics Research Center, Iran University of Medical Sciences, No. 6, Rashid Yasemi St. Vali –e Asr Ave, Tehran, Iran
Tel: 009821 88671614                                              Email: herofarabi@gmail.com
Abstract:
Background & Objectives: Recently, Activity-based Costing method has been used instead of traditional method of cost calculation, especially in the health sector. In spite of its advantages, this method has some limitations such as cost driver selection, which, in the case of being selected incorrectly, it leads to errors in results. The purpose of this study was to select the most appropriate cost drivers in hospitals.
Methods: This descriptive and qualitative study was done in one of the Educational hospitals affiliated to Iran University of Medical Sciences, Tehran, Iran. The allocated costs of IT, nutrition and cleaning units to the delivery, surgery, burn, dialysis, cardiovascular and eye wards were calculated based on the hospital financial data of 2016. Based on the searched data, cost drivers were identified and eventually, a panel of experts determined the most appropriate cost drivers.
Results: The cost allocated by hospital the support units to the different wards varied based on different cost drivers. The appropriate cost drivers of nutrition, housing, and information technology units were the number of food portions, the square area and the number of active computers, respectively.
Conclusion: Due to the impact of cost drivers on the correct estimation of the cost of services in the healthcare sector, selection of appropriate cost drivers for each sector should be made on the agenda of Health policymakers.
 
Key­words: Activity-based Costing, Cost drivers, Teaching Hospital, Costing
 
­Citation: Meshkani Z, Reza Pour A, Farabi H, Alipour V, Mazdaki A, Hakimi N. Determination of Cost Drivers through Activity Based Costing Method in Determination of Hospital Services Costs. Journal of Health Based Research 2019; 5(1): 1-12. [In Persian]