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Related Experiment Videos

Patient supply charges: still a revenue source?

M R Hurwitz1

  • 1Kowalski-Dickow Associates, Milwaukee, WI.

Healthcare Financial Management : Journal of the Healthcare Financial Management Association
|August 6, 1993
PubMed
Summary

Patient supply charges, a long-standing practice in medical insurance, have risen with healthcare costs. Financial managers must evaluate if these charges truly benefit programs, as costs can outweigh contributions.

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Area of Science:

  • Healthcare Finance
  • Medical Billing
  • Health Services Management

Background:

  • Patient supply charges are a traditional component of medical insurance billing.
  • Escalating healthcare costs have led to increased supply charges.
  • Regulatory and financial pressures are mounting on supply charge practices.

Purpose of the Study:

  • To analyze the financial implications of patient supply charge programs.
  • To assess the net contribution of supply charges in healthcare financial management.
  • To inform healthcare financial managers about potential cost-benefit imbalances.

Main Methods:

  • Review of historical billing practices for medical/surgical supplies.
  • Analysis of trends in healthcare costs and supply charge escalation.
  • Evaluation of financial models to determine program profitability.

Main Results:

  • Supply charges have increased in tandem with overall healthcare expenditures.
  • The administrative and operational costs of managing supply charge programs can be substantial.
  • In some cases, the cost of implementing and maintaining these programs may exceed their generated revenue.

Conclusions:

  • Healthcare financial managers need to critically assess the financial viability of patient supply charge programs.
  • Cost-benefit analyses are crucial to ensure these programs provide a genuine financial contribution.
  • Strategies to optimize or revise supply charge practices may be necessary to align with financial goals.

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