Activity based costing in health care center: a case study of Iran

Abstract

Lack of attention to real costs has made implementing a costing system which targets the listed purposes in the appropriate format pilot units seem essential. The purpose of this study is to calculate the unit cost of services provided in a health care center in Iran. This study has a cross sectional description and is based on the 2010 financial data. The department studied is a health center affiliated to Tehran University of Medical Sciences. A scientific committee which is composed of the health and budget and financing experts was set up. Then the required form was designed to collect data on the costs and services provided. Data entry was done through Excel software and analyzed based on activity based costing system following eight steps. The results of this study are presented as a “unit cost” of more than 80 types of services offered in the final activity units of the health center studied. Polio vaccine by the unit of vaccination with the unit cost of $0.84 and TB treatment by disease unit with the unit cost of$64.79 are respectively the lowest and highest unit costs of services rendered by the health center studied. Due to the high share of personnel costs of total expenditures (73%), increased labor productivity plays an important role in reducing costs. Moreover, integrated units with similar services, according to their capacity to accept and organize similar activities in the implementation process of various services to prevent their repetition, are also effective in reducing costs