Activity-based costing: a practical model for cost calculation in radiotherapy

Area of Science:

• Medical Economics
• Health Services Research

Background:

• Accurate cost calculation is essential for efficient healthcare management.
• Traditional costing methods may not fully capture the complexities of specialized medical services like radiotherapy.

Purpose of the Study:

• To develop and present an activity-based costing (ABC) model for calculating radiotherapy costs.
• To describe the model, its calculated costs, and potential applications within a radiotherapy department.

Main Methods:

• Employed the activity-based costing (ABC) method, an advanced cost allocation technique.
• Developed a simplified Leuven model by adding an allocation step to streamline cost drivers.
• Utilized a time-consumption principle, adjusted for treatment complexity, for cost allocation.

Main Results:

• Personnel and equipment costs are the primary determinants of radiotherapy expenses.
• Treatment delivery activities represent the largest share of resource costs.
• Longer treatment durations correlate with higher overall costs.

Conclusions:

• The developed ABC model serves as a practical tool for analyzing radiotherapy cost structures.
• The model facilitates the evaluation of potential changes in resource allocation and clinical practices.