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Original Article

Activity-Based Costing Analysis of Nursing Activities in General Hospital Wards

Ho-Soon Yoon1, Jinhyun Kim2
Journal of Korean Academy of Nursing Administration 2013;19(4):449-461.
Published online: September 30, 2013

1National Health Insurance Cooperation Ilsan Hospital, Korea.

2College of Nursing·The Research Institute of Nursing Science, Seoul National University, Korea.

Corresponding author: Kim, Jinhyun. College of Nursing·The Research Institute of Nursing Science, Seoul National University, Seoul 100-744, Korea. Tel: +82-2-740-8818, Fax: +82-2-6280-0781, jinhyun@snu.ac.kr
• Received: March 11, 2013   • Revised: May 10, 2013   • Accepted: August 21, 2013

Copyright © 2013 Korean Academy of Nursing Administration

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  • Purpose
    The purpose of this study was to explore the relationship between cost and revenue for inpatient nursing activities in general wards.
  • Methods
    Data were collected from 12 medical-surgical wards in one general hospital from January 1 to December 31, 2010. The nursing activities were categorized into 2 groups according to nursing service payment type in terms of the Korea health insurance system. Descriptive statistics were used to identify nursing activities and nursing activity costs.
  • Results
    Of 140 nursing activities identified as performed in general wards, payment for 69 items was included in nursing management fees. The percentage of each cost for the nursing units was 90% for labor, 4% for materials, and 6% for operating expenses. The cost for medical support nursing service accounted for 38% of costs and nursing management fees, 62%. The average profit and loss was -237,257,000 won. The cost recovery rate for nursing service was only 44%.
  • Conclusion
    The results indicate a need to measure the economic value of nursing activities performed in general wards and use it as a basis for establishing an adequate reimbursement system for nursing service.
  • Key Words: Nursing fee; Cost analysis; Nursing cost

This article is based on a part of the first author's doctoral dissertation from Seoul National University.

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Table 1
Framework of Nursing Activity Classification by Insurance System Payment Type
jkana-19-449-i001.jpg
Table 2
Time Spent & Cost Driver Rate for Nursing Activities
jkana-19-449-i002.jpg

EKG=Electrocardiogram; BP=Blood Pressure; EVD=Extra Ventricular Drainage; VRE=Vancomycin Resistant Enterococci; MRSA=Methicylin Resistant Staphylococcus aureus; PTBD=Percutanous Transhepatic Biliary Drainage; OCS=Order Communication System; CSR=Central Sterilization Room; SPD=Supply Purchasing Department †Assigned cost/activity quantity; *Activity applied cost per day; **Activity applied cost per month: Cost revised to activity quantity×15 (average nursing staff in a unit)

Table 3
Assigned Cost Ratio by Payment Type in Nursing Domains
jkana-19-449-i003.jpg
Table 4
Revenue from Inpatient Fees by Ward (\1,000)
jkana-19-449-i004.jpg
Table 5
Cost-Volume-Profit Analysis (\1,000)
jkana-19-449-i005.jpg

TNS=Total Nurses' Salaries; MATC=Material Cost; EXP=Expense Used in Nursing Unit; PINAC=Nursing Activity Cost for Medical Service Paid Independently; MNAC=Nursing Activity Cost included in Nursing Management fee; DPINAC=Distributed Cost for PINAC=PINAC+MATC×Proportion of PINAC+EXP×proportion of PINAC; DMNAC=Distributed Cost for MNAC=MNAC+MATC×Proportion of MNAC+EXP×Proportion of MNAC; NMF=Nursing Management Fee (Income); L/P=Loss & Profit for Nursing Unit=NMF-DMNAC.

Figure & Data

References

    Citations

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    Activity-Based Costing Analysis of Nursing Activities in General Hospital Wards
    J Korean Acad Nurs Adm. 2013;19(4):449-461.   Published online September 30, 2013
    DOI: https://doi.org/10.11111/jkana.2013.19.4.449
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    Activity-Based Costing Analysis of Nursing Activities in General Hospital Wards
    J Korean Acad Nurs Adm. 2013;19(4):449-461.   Published online September 30, 2013
    DOI: https://doi.org/10.11111/jkana.2013.19.4.449
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    Related articles

    Activity-Based Costing Analysis of Nursing Activities in General Hospital Wards
    Activity-Based Costing Analysis of Nursing Activities in General Hospital Wards

    Framework of Nursing Activity Classification by Insurance System Payment Type

    Time Spent & Cost Driver Rate for Nursing Activities

    EKG=Electrocardiogram; BP=Blood Pressure; EVD=Extra Ventricular Drainage; VRE=Vancomycin Resistant Enterococci; MRSA=Methicylin Resistant Staphylococcus aureus; PTBD=Percutanous Transhepatic Biliary Drainage; OCS=Order Communication System; CSR=Central Sterilization Room; SPD=Supply Purchasing Department †Assigned cost/activity quantity; *Activity applied cost per day; **Activity applied cost per month: Cost revised to activity quantity×15 (average nursing staff in a unit)

    Assigned Cost Ratio by Payment Type in Nursing Domains

    Revenue from Inpatient Fees by Ward (\1,000)

    Cost-Volume-Profit Analysis (\1,000)

    TNS=Total Nurses' Salaries; MATC=Material Cost; EXP=Expense Used in Nursing Unit; PINAC=Nursing Activity Cost for Medical Service Paid Independently; MNAC=Nursing Activity Cost included in Nursing Management fee; DPINAC=Distributed Cost for PINAC=PINAC+MATC×Proportion of PINAC+EXP×proportion of PINAC; DMNAC=Distributed Cost for MNAC=MNAC+MATC×Proportion of MNAC+EXP×Proportion of MNAC; NMF=Nursing Management Fee (Income); L/P=Loss & Profit for Nursing Unit=NMF-DMNAC.
    Table 1 Framework of Nursing Activity Classification by Insurance System Payment Type

    Table 2 Time Spent & Cost Driver Rate for Nursing Activities

    EKG=Electrocardiogram; BP=Blood Pressure; EVD=Extra Ventricular Drainage; VRE=Vancomycin Resistant Enterococci; MRSA=Methicylin Resistant Staphylococcus aureus; PTBD=Percutanous Transhepatic Biliary Drainage; OCS=Order Communication System; CSR=Central Sterilization Room; SPD=Supply Purchasing Department †Assigned cost/activity quantity; *Activity applied cost per day; **Activity applied cost per month: Cost revised to activity quantity×15 (average nursing staff in a unit)

    Table 3 Assigned Cost Ratio by Payment Type in Nursing Domains

    Table 4 Revenue from Inpatient Fees by Ward (\1,000)

    Table 5 Cost-Volume-Profit Analysis (\1,000)

    TNS=Total Nurses' Salaries; MATC=Material Cost; EXP=Expense Used in Nursing Unit; PINAC=Nursing Activity Cost for Medical Service Paid Independently; MNAC=Nursing Activity Cost included in Nursing Management fee; DPINAC=Distributed Cost for PINAC=PINAC+MATC×Proportion of PINAC+EXP×proportion of PINAC; DMNAC=Distributed Cost for MNAC=MNAC+MATC×Proportion of MNAC+EXP×Proportion of MNAC; NMF=Nursing Management Fee (Income); L/P=Loss & Profit for Nursing Unit=NMF-DMNAC.

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