Cost Accounting System to Improve Healthcare in Rural Haiti

A good method of Cost accounting helps to identify possible inefficiencies and areas of necessary improvement.

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A few years ago, a Boston based non-profit healthcare organization 'Partners In Health', worked in the health care system in Haiti and submitted a report on "Building Surgical Systems in Haiti". The report highlights that the 2010 earthquake resulted in thousands of donors, philanthropists, and international organizations coming to Haiti to offer services. For months they worked to save lives and ease suffering. What they did not do, however, was to contribute to strengthening Haiti's public health system while the main challenge to improve this sector was nothing but to getting doctors and care giver's commitment and involvement into the essence of the system.

When their team visited different clinics with a method of cost ascertaining technique, they were surprised to notice that the cost of care varied dramatically from clinic to clinic. Robert S. Kaplan, the Marvin Bower Professor of Leadership Development, a member of the team developed a suitable cost ascertainment technique named Time-Driven Activity-Based Costing (TDABC). It combines two basic measures-- the cost of each resource used to perform an activity, and the time it takes to perform it.

TDABC had the objective for proper utilisation of limited resources in Haiti and decide how to allocate their limited resources to optimize the quantity, quality, and access to care. In 2015, Haitian government's per capita spending for health care was meagre $54 compared to $9,536 per capita in the United States. By 2017, the per capita expenditure on this account in Haiti had dropped to $13. The researchers visited five rural clinics in the central highlands of Haiti and compared the cost of care for the same 10 types of visits--including acute care, women's health care, family planning, HIV, and malaria. They were shocked to notice that the community workers and the clinical personnel have no experience or knowledge of cost ascertainment of their services at all. Their team also noticed over-crowded, under-staffed facilities. Consult time depended largely on the ratio of patients to provider. The clinic that treated 1,150 patients reported a median consult time of five minutes, while a clinic that treated 344 patients reported a median consult time of 11 minutes.

In a low-income resource country like Haiti, it is very important to understand the underlying resource costs to deliver services.

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