Accounting for the move to ambulatory patient groups

This article focuses on the cost accounting challenge an ambulatory patient group (APG)-like-based prospective payment system presents to providers and the issues associated with that challenge. In particular, how can costs be identified, how can the differences in costs be associated with alternative settings, and how do costs identified through a detailed resource costing methodology compare to estimates using alternative measures? The results presented suggest that decisions made based on current measures of ambulatory cost (i.e., charge-based measures) need to be reexamined. These decisions could include which services to provide, what setting is appropriate, and where marketshare opportunities exist.