Determining costs associated with quality in health care delivery

This article examines the costs associated with quality in health care delivery. A model applicable to health care settings is specified according to investments in quality and the cost of not achieving quality. The premises and basic theories underlying the model are explored. The model was developed at Lovelace Health Systems in Albuquerque, New Mexico, as a decision making tool. The specific cost elements comprising the quality cost model are identified and illustrated using the working model adopted at Lovelace. The managerial impact of the quality cost model and the implications for other health care organizations are examined.