The environment within which health care accounting is performed is in the midst of dramatic change.1 The accurate costing of delivered services is, within this dynamic environ ment, assuming an ever greater significance.2 This research examines one change being introduced into the hospital cost accounting process: the application of a two stage activity based cost accounting.3
The findings of this examination are presented in three separate discussion. The first of these discussions considers existing cost models, while the second discussion examines the two stage activity based cost accounting procedure, and the third discussion assesses the probable impact on hospital administration of the application of the two stage activity based cost accounting procedure.
1D. W. Young, "Cost Accounting and Cost Comparisons: Methodological Issues and Their Policy and Management Implica tions," Accounting Horizons, v. 2, March 1988, pp. 68 69.
2S. Mendenhall, R. Shepherd, and E. Kabrinski, "Cost Accounting in Health Care Organizations: Who Needs It?" Health Care Financial Management, v. 4, January 1987, p. 40.
3R. Cooper, "The Two Stage Procedure in Cost Accounting: Part One," Jorunal of Cost Management for the Manufacturing Industry, v. 1, Summer 1987, pp. 43 51; R. Cooper, "The Two Stage Procedure in Cost Accounting Part Two," Jorunal of Cost Management for the Manufacturing Industry, v. 1, Fall 1987, pp. 39 45.
Health care economics is in a state of turmoil, as a result of dynamic changes occurring in the health services environment. The contemporary health services sector is com prised of a wide variety of types of health care providers. Health maintenance organizations (HMOs), behavioral medicine clinics, nursing homes, and general acute care hospitals are among the major components of the health services sector. A major and growing source of change for health care economics is the presence of corporate health care pr...