Question

Research and find another overall performance KPI which utilizes financial information. Define this KPI, share source, and explain how it is used. Which healthcare segment (hospital, provider practice, home health, skilled nursing facility, etc) uses this primarily? How is it calculated? How could it be adapted for another segment of healthcare to utilize and measure?

Answer 1

Treatment cost can be seen as a typical KPI which is commonly used in healthcare. Treatment cost can be seen as a critical indicator to track as these have the potential of influencing the finance of a hospital and the capacity of the facility to sustain itself over a longer period of time. The main objective is not to control it to the minimum level to have greater profit but to identify the abnormal or too much expenses and managing them.

There are a number of ways to determine it – i.e. on the basis of per unit, per operations, per process, per age group and so on. Improved budgeting can be availed by identifying all these costs and this will enable the management to direct the correct amount of money to the suitable head.

This can be determined by determining the treatment cost as per the various categories in the different time period and analyze the result obtained