Research On ABC-based Hospital Cost Management

With the promotion of the health system reform, the medical industry becomes more and more market-oriented, competition pressure the public hospitals faced becomes more serious, so carrying out cost management in the hospital has become the key points in the study and work of the hospital. Through cost accounting management, hospital can improve its operating efficiency, and reduce the cost of Health Service Items, and then increase the economical effects of the hospital. At present, the cost management model applied in our country’s public hospital was based on the traditional cost accounting management, which is based on the supposition that "the volume of business is the only factor that influence cost", the accounting process is simple and easy to operate, but the accounting results is inaccurate and the cost allocation is irrational, so it can’t meet the needs of hospital cost management. Therefore, we have to explore a new model of cost management to adapt the new situation that the hospital faced.As an advanced cost-management tool, Activity-based Costing(ABC) was applied in manufacturing industry firstly. Compared with traditional cost accounting, it has the special advantage in Enterprise Cost Management, but activity-based costing hardly ever be applied in the hospital cost management. Therefore, basing on the theory of Activity-based Costing and hospital cost management, this paper firstly explore and analyze the necessity and feasibility of the application of Activity-based Costing(ABC) in hospital cost management, put forward some specific Methods and Procedure about how to implement Activity-based Costing Management in the hospital. And then, this paper selects a comprehensive hospital CT room for the study, respectively using the traditional method and activity-based costing method in the calculation of the cost of Health Service Items. Through the comparison and analysis of the process and results of the different accounting method, we find many advantages of the application of Activity-based Costing in the hospital cost management. At last, this paper put forward some suggestions in the process of applying Activity-based Costing Management in hospitals in accordance with their actual conditions.This paper concludes that Activity-based Costing Management is more adaptable to the situation the hospital faced at present, and the hospital that satisfy the requirements in applying the Activity-based Costing can adopt Activity-based Costing Management to improve the level of hospital cost management, and then improve the hospital’s operating efficiency and competitive capacity in the market.