Improving the accuracy of admitted subacute clinical costing: an action research approachSharon Hakkennes A C , Ross Arblaster A and Kim Lim B
A Knowledge and Information Services, Barwon Health, PO Box 281, Geelong, Vic. 3228, Australia. Email: email@example.com
B Visasys Pty Ltd, PO Box 751, Glen Waverley, Vic. 3150, Australia. Email: firstname.lastname@example.org
C Corresponding author. Email: email@example.com
Australian Health Review - https://doi.org/10.1071/AH15063
Submitted: 20 March 2015 Accepted: 6 July 2016 Published online: 29 August 2016
Objective The aim of the present study was to determine whether action research could be used to improve the breadth and accuracy of clinical costing data in an admitted subacute setting
Methods The setting was a 100-bed in-patient rehabilitation centre. Using a pre-post study design all admitted subacute separations during the 2011–12 financial year were eligible for inclusion. An action research framework aimed at improving clinical costing methodology was developed and implemented.
Results In all, 1499 separations were included in the study. A medical record audit of a random selection of 80 separations demonstrated that the use of an action research framework was effective in improving the breadth and accuracy of the costing data. This was evidenced by a significant increase in the average number of activities costed, a reduction in the average number of activities incorrectly costed and a reduction in the average number of activities missing from the costing, per episode of care.
Conclusions Engaging clinicians and cost centre managers was effective in facilitating the development of robust clinical costing data in an admitted subacute setting. Further investigation into the value of this approach across other care types and healthcare services is warranted.
What is known about this topic? Accurate clinical costing data is essential for informing price models used in activity-based funding. In Australia, there is currently a lack of robust admitted subacute cost data to inform the price model for this care type.
What does this paper add? The action research framework presented in this study was effective in improving the breadth and accuracy of clinical costing data in an admitted subacute setting.
What are the implications for practitioners? To improve clinical costing practices, health services should consider engaging key stakeholders, including clinicians and cost centre managers, in reviewing clinical costing methodology. Robust clinical costing data has the potential to be used beyond mandatory reporting requirements; however, health services need to balance the cost of improving their costing data with the additional value obtained from that data.
Additional keywords: activity-based funding.
References Daley J, McGannon C, Hunter A. Budget pressures on Australian governments, 2014 edition. Melbourne: Grattan Institute; 2014.
 Duckett SJ, Breadon P, Weidmann B, Nicola I. Controlling costly care: a billion dollar hospital opportunity. Melbourne: Grattan Institute; 2014.
 Jackson T. Cost estimates for hospital inpatient care in Australia: evaluation of alternative sources. Aust N Z J Public Health 2000; 24 234–41.
| Cost estimates for hospital inpatient care in Australia: evaluation of alternative sources.CrossRef | 1:STN:280:DC%2BD3cvisFyitA%3D%3D&md5=b2c4987172136f0afd1785f64f688ed7CAS | 10937398PubMed |
 Independent Hospital Pricing Authority. The pricing framework for Australian public hospital services 2014–2015. Canberra: Commonwealth of Australia; 2013.
 Health Policy Solutions. Activity based funding for Australian public hospitals: towards a pricing framework. Sydney: Independent Hospital Pricing Authority; 2011.
 Department of Health. Victorian health policy and funding guidelines 2012–13. Melbourne: Department of Health; 2012.
 Department of Health. Victorian health policy and funding guidelines 2013–14. Part one – key changes and new initiatives. Melbourne: Department of Health; 2013.
 Waters HR, Hussey P. Pricing health services for purchasers – a revew of methods and experiences. Health Policy 2004; 70 175–84.
| Pricing health services for purchasers – a revew of methods and experiences.CrossRef | 15364147PubMed |
 Raulinajtys-Grzybek M. Cost accounting models used for price-setting of health services – an international review. Health Policy 2014; 118 341–53.
| Cost accounting models used for price-setting of health services – an international review.CrossRef | 25082465PubMed |
 Ernst and Young. National non-admitted and subacute admitted costing study. Sydney: Independent Hospital Pricing Authority; 2014.
 Meyer J. Using qualitative methods in health related action research. BMJ 2000; 320 178–81.
| Using qualitative methods in health related action research.CrossRef | 1:STN:280:DC%2BD3c7gtVKrsg%3D%3D&md5=8d8354882117e214acd299147b0f267dCAS | 10634744PubMed |
 Reason H, Bradbury H. Handbook of action research: participative inquiry and practice. London: Sage; 2007.
 Independent Hospital Pricing Authority. Hospital patient costing standards. Version 3.1. Canberra: Commonwealth of Australia; 2014.
 Chapman CS, Kern A. Costing in the National Health Service – from reporting to managing. London: Imperial College London; 2010.
 Chapman CS, Kern A, Laguecir A, Angelé-Halgand N, Angert A, Campenale C, Cinquini L, Doyle G, Garrot T, Hansen A, Hartmann F, Hinz V, Mateus C, Perego P, Sikkut R, Tenucci A, Quentin W. International approaches to clinical costing. Bristol: Healthcare Financial Management Association; 2013.
 Blunt I, Bardsley M. Patient-level costing – can it yield efficiency savings? London: Nuffield Trust; 2012.
 Waters H, Hussey P. Pricing health services for purchasers – a review of methods and experiences. Washington, DC: The World Bank; 2004.
 National Allied Health Casemix Committee. Health activity hierarchy – version 1.1. Melbourne: RMIT University; 2001.