Wednesday, May 21, 2014

Case Costing Sample Assignment www.sampleassignment.com

Overview
The objective of this paper is to provide an overview of the general steps that are taken to cost a given case in general and apply the knowledge to the case of Ontario Case Costing in particular. Case Costing is defined as an accounting procedure that involves all types of direct and indirect costs that are involved in a particular care unit for providing service to a patient (Gray et al, 2004). It is also referred to as cost accounting, activity based costing and patent-level costing. Case Costing is used at different levels in health care system in Canada which includes individual, regional, provincial and national level among others (Gray et al, 2004).
Breakup of the total cost involved
There are many factors that work together when a service is provided at a hospital. Some of the most basic examples include the actual treatment, specialised equipments used for diagnosing the problem and addressing it, the things utilised by the patient, meals taken, involved cost of the hospitality staff, cost of the drugs that are used, building costs, laboratory costs to name a few (Frolich, 1998). Hence, the actual cost involves a number of smaller units and factors which are to be considered while providing the actual cost to the service user and which make up the actual cost (Yong et al, 2009).

Estimating the cost per user
            The service provider provides costs to the individual service users by defining the costs involved of their staff members, estimating their own costs involved in the services. They also specific formulas using which they can get close to determine the per head cost of an individual service user (Genest, 2009). This also means that more number of augmented services a service provider offers, more would be the per cost unit for the individual user. The objective of using these specialised tools in estimating the costs is to ensure that there is a higher degree of transparency in the operations, there is a stringent control over the expenditure involved and also for improving the overall health care industry services (Yong et al, 2009).
How are costs determined? : Types of Costs involved
            Costing systems differ in different organisations; the most common method is to use micro costing (specific items used by a service user) and allocating methods (allocation of general expenditures). The costing also involved direct and indirect variables, direct costs from the part of micro costing whereas indirect costs are a part of allocated costs (Frolich, 1998). Overhead expenses are generally the recurring expenses of a business organisation and are a typical example of an indirect cost. Apart from this, the costs can be distinguished as fixed and variable, fixed costs do not change with the volume whereas variable costs changes as volume changes (Yong et al, 2009).
The next section of this paper describes the Ontario Case Costing Initiative (OCCI). OCCI are standards that are followed by all the hospitals and health care service providers to ensure that the costs that they are charging to the end users are fair, justified and transparent. The standards also offer dedicated and specialised software which eases the computation of different kinds of costs involved and bring in a greater degree of efficiency at the operational level. It further helps in improved decision making for the senior management and helps tremendously in the planning processes as well (Gray et al, 2004).
The standard is also utilised as a database for research purposes as huge amount of data is stored in the system. It followed a set standard of methodologies and procedures to help in exactly determining the actual costs for the organisation as a whole and for the service user as an individual. OCCI has also faced several challenges owing to different kinds of organisational culture which utilises the generalised form of systems in their respective organisations (Genest, 2009).


References
Frolich, J. (1998). Rationale for and Outline of the Recommendations of the Working Group
                on Hypercholesterolemia and Other Dyslipidemias: Interim Reprto. Dyslipidemia
            Working Group of Health Canada. Canadian Journal Cardiology , 17 A- 21 A.
Genest, J. (2009). 2009 Canadian Cardiovascular Society/Canadian Guidelines for the
                Diagnosis and Treatment of Dyslipidemia and Prevention of Cardiovascular Disease i
            n the Adult—2009 Recommendations. Canadia Journal of Cardiology , 567-579.
Gray, M. S. (2004). A Longitudinal Study of the Effects of Age and Time to Death on
                Hospital Costs. Journal of Health Economics , 23 (2), 217-235.
Yong, A. P. (2009). Population Aging and Its Implications on Aggregate Health Care
                Demand: Empirical Evidence from 22 OECD Countries. International Joiurnal of

            Health Care Finance & Economics , 9 (4), 391-402.



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