Cost evaluation of clinical laboratory in Taiwan’s National Health System by using activity-based costing
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Bin-Guang Su
Abstract
Background:
To cope with the government’s policies to reduce medical costs, Taiwan’s healthcare service providers are striving to survive by pursuing profit maximization through cost control. This article aimed to present the results of cost evaluation using activity-based costing performed in the laboratory in order to throw light on the differences between costs and the payment system of National Health Insurance (NHI).
Methods:
This study analyzed the data of costs and income of the clinical laboratory. Direct costs belong to their respective sections of the department. The department’s shared costs, including public expenses and administrative assigned costs, were allocated to the department’s respective sections. A simple regression equation was created to predict profit and loss, and evaluate the department’s break-even point, fixed cost, and contribution margin ratio.
Results:
In clinical chemistry and seroimmunology sections, the cost per test was lower than the NHI payment and their major laboratory tests had revenues with the profitability ratio of 8.7%, while the other sections had a higher cost per test than the NHI payment and their major tests were in deficit. The study found a simple linear regression model as follows: “Balance=–84,995+0.543×income (R2=0.544)”.
Conclusions:
In order to avoid deficit, laboratories are suggested to increase test volumes, enhance laboratory test specialization, and become marginal scale. A hospital could integrate with regional medical institutions through alliances or OEM methods to increase volumes to reach marginal scale and reduce laboratory costs, enhancing the level and quality of laboratory medicine.
Author contributions: All the authors have accepted responsibility for the entire content of this submitted manuscript and approved submission.
Research funding: None declared.
Employment or leadership: None declared.
Honorarium: None declared.
Competing interests: The funding organization(s) played no role in the study design; in the collection, analysis, and interpretation of data; in the writing of the report; or in the decision to submit the report for publication.
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©2016 Walter de Gruyter GmbH, Berlin/Boston
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- Frontmatter
- Editorials
- CCLM Award for the Most Cited Paper Recently Published
- Laboratory economics. Risk or opportunity?
- Reviews
- Molecular diagnosis and precision medicine in allergy management
- The insulin autoimmune syndrome (IAS) as a cause of hypoglycaemia: an update on the pathophysiology, biochemical investigations and diagnosis
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- Quality performance of laboratory testing in pharmacies: a collaborative evaluation
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- Impact of sample processing on the measurement of circulating microparticles: storage and centrifugation parameters
- HbA1c: EQA in Germany, Belgium and the Netherlands using fresh whole blood samples with target values assigned with the IFCC reference system
- Iohexol clearance in unstable critically ill patients: a tool to assess glomerular filtration rate
- Characteristics of Chinese patients with antiphospholipid syndrome and the ability of lupus anticoagulant assays to identify them
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- Distribution of soluble suppression of tumorigenicity 2 (sST2), N-terminal pro-brain natriuretic peptide (NT-proBNP), high sensitive troponin I and high-sensitive troponin T in umbilical cord blood
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