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J Med Syst. 2019 Dec 11;44(1):25. doi: 10.1007/s10916-019-1503-2.

Using Time-Driven Activity-Based Costing to Demonstrate Value in Perioperative Care: Recommendations and Review from the Society for Perioperative Assessment and Quality Improvement (SPAQI).

Author information

1
Harvard College, Harvard University, Boston, MA, USA.
2
Center for Surgery and Public Health, Brigham and Women's Hospital, Boston, MA, USA. rurman@bwh.harvard.edu.
3
Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital, Harvard Medical School, 75 Francis Street CWN L1, Boston, MA, 02115, USA. rurman@bwh.harvard.edu.
4
Department of Anesthesiology, Wake Forest School of Medicine, Winston-Salem, NC, USA.
5
Department of Anesthesiology, Duke University School of Medicine, Durham, NC, USA.
6
Department of Medicine, Medical College of Wisconsin, Milwaukee, WI, USA.
7
Institute for Strategy and Competitiveness, Harvard Business School, Harvard University, Boston, MA, USA.
8
Center for Surgery and Public Health, Brigham and Women's Hospital, Boston, MA, USA.
9
Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital, Harvard Medical School, 75 Francis Street CWN L1, Boston, MA, 02115, USA.

Abstract

A shift in healthcare payment models from volume toward value-based incentives will require deliberate input into systems development from both perioperative clinicians and administrators to ensure appropriate recognition of the value of all services provided-particularly ones that are not reimbursable in current fee-for-service payment models. Time-driven activity-based costing (TDABC) methodology identifies cost drivers and reduces inaccurate costing based on siloed budgets. Inaccurate costing also results from the fact that current costing methods use charges and there has been tremendous cost shifting throughout health care. High cost, high variability processes can be identified for process improvement. As payment models inevitably evolve towards value-based metrics, it will be critical to knowledgably participate in the coordination of these changes. This document provides 8 practical Recommendations from the Society for Perioperative Assessment and Quality Improvement (SPAQI) aimed at outlining the principles of TDABC, creating process maps for patient workflows, understanding payment structures, establishing physician alignment across service lines to create integrated practice units to facilitate development of evidence-based pathways for specific patient risk groups, establishing consistent care delivery, minimizing variability between physicians and departments, utilizing data analytics and information technology tools to track progress and obtain actionable data, and using TDABC to create costing transparency.

KEYWORDS:

Accounting, process map; Cost, TDABC; Outcomes; Value-based health care

PMID:
31828517
DOI:
10.1007/s10916-019-1503-2

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