A new accounting system for financial balance based on personnel cost after the introduction of a DPC/DRG system

Area of Science:

• Health Services Management
• Healthcare Economics
• Hospital Administration

Background:

• Hospital financial management is complex, requiring accurate revenue and expense estimation per clinical division.
• The Diagnosis Procedure Combination Prospective Payment System (DPC/PPS) introduced in 2003 complicates cost attribution due to integrated payment components.
• Existing methods for calculating medical costs and financial balance are often programmatic and complex.

Purpose of the Study:

• To develop a simplified, programmatic method for calculating medical costs and financial balance within hospitals.
• To address the complexities introduced by the DPC/PPS in financial analysis.
• To enable efficient financial assessment at the clinical division level.

Main Methods:

• A novel, simplified method for financial calculation was devised.
• The method is primarily based on analyzing personnel costs.
• The approach was validated by a single individual for a large hospital (535 beds, 16 clinics).

Main Results:

• The developed method successfully calculated medical costs and financial balance.
• The calculations were completed efficiently by one individual without reliance on central hospital IT systems.
• The method proved effective despite the intricate nature of the DPC/PPS.

Conclusions:

• A simple, personnel cost-based method can effectively determine hospital financial balance and medical costs.
• This approach simplifies financial management, particularly under complex payment systems like DPC/PPS.
• The method offers a practical solution for individual hospital financial analysis and strategic planning.