• Korea Journal of Hospital Management
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• v.19 no.1
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• pp.32-42
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• 2014

It is necessary to calculate prime cost of medical services accurately in order to evaluate the adequacy of medical fee. This paper aims to identify cost analysts' perception on prime cost of medical services and needs in establishing a cost accounting system in hospitals, proposing future directions and guidelines for the calculation of medical fee. A self-administered questionnaire and telephone survey on operation of a hospital cost-accounting system was conducted in November, 2012, among cost analysts currently working in the hospitals and hospital administrators planning to implement the hospital cost-accounting system. Our study shows that most of the cost analysts were aware of the importance of calculating prime cost and responded that collection of the prime cost data from government is necessary although they are less likely to provide the data in the future concerning the risk of data misuse and data security. They also responded that lack of budget allocation and excessive workload were the main reasons for not estimating the prime cost and operating cost management information system. Results show that hospital cost analysts considered the data accuracy is the most critical factor in calculating prime costs of medical services. However, there was no investment budget allocated in some hospitals or limited to less than 100 million, indicating that hospitals are reluctant to invest on implementing the cost accounting system. Respondents stated the organization that collects the prime cost of medical services among hospitals should display strong analytical capabilities, ensure data security, and maintain independence, which is most demanded. There are 57 hospitals that calculated the prime cost of medical services for 2012 by each medical department and 20 hospitals that calculated the prime cost by fee-for-services, aiming to establish a cost accounting system. Our results indicate that hospitals should voluntarily provide the accurate prime cost for medical services in order to properly evaluate the adequacy of medical fee. Consequently, it is critical to establish an independent organization to collect and appraise the data. It is also recommended that government should implement various policies to encourage hospitals to participate in the data collection to achieve the data accuracy and representativeness.

• Health Policy and Management
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• v.20 no.2
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• pp.40-52
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• 2010

Health insurance fees are set by relative value scales and conversion factors. Since 2008 the conversion factor has been classified into 7 according to the provider type, and a separate contract has been made respectively. As such classification of the conversion factor reflects only the different characteristics of providers, however, further classification to reflect the different cost structures of providers is proposed. Cost varies according to the type of not only providers but also services each provider supply. In fact different cost structures of providers are the result of their different services. This study analyzed the cost structure of medical services to propose a new approach to the classification of the conversion factor. This study analyzed the cost structure of medical services using cost data constructed in the revision study of relative value scales. The cost data consist of doctor's fee, support staff's fee, cost of medical equipments, cost of medical supplies and indirect cost. The proportion of each cost component to the total cost was analyzed in terms of service department and service type. 72 service groups are defined in terms of the combination of service department and service type. Through cluster analysis, 72 service groups were reduced into 7 clusters each of which has a similar cost structure. Conversion factor is contracted annually to reflect the change in the cost of providing medical services. So the classification of conversion factor has to be based on the cost structures of medical services, not the characteristics of providers. Service clusters derived in this study can be used as a new classification for health insurance fee contract.

• Korea Journal of Hospital Management
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• v.14 no.3
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• pp.23-48
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• 2009

The purpose of this study was to provide criteria which help executives to make decisions through the analysis of profitability of ultrasonography conducted in each medical department. In order to achieve such purpose, the study conducted break-even analyses on three medical departments of a university hospital in which has used ultrasonography was largely conducted in diagnosing diseases and performing surgeries. The research was carried out from January to June 2008. The data necessary for calculating cost, were collected using by computerized data. The results of the study were summarized as follows. 1. The Cost structure of each medical department: The Cost of ultrasonography was divided into direct cost and indirect cost through the categorization by cost object. Labor cost accounted for the largest portion of the direct cost with 69.3% in the department of obstetrics and gynecology, 67.4% in the department of radiology and 58.2% in the cardiac ultrasonography center, which followed by the depreciation cost of ultrasonography equipment. The calculation of the average material cost of each ultrasonographic test by medical test found that the cardiac ultrasonography center took first place with 2,355 won, followed by the department of obstetrics and gynecology with 266 won and the department of radiology with 233 won. As for the power cost of ultrasonography equipment, the department of radiology took fist place with 442,000 won. The power cost, however, did not affect much the cost price, because it accounted for only a small portion of the cost. As for indirect cost, the cardiac ultrasonography center ranked first with 7,156,000 won. Building depreciation cost accounted for the largest portion of the indirect cost. 2. Break-even analysis: Under the supposition that cost price can be divided into fixed cost and variable cost, a break-even analysis was conducted using the cost price confirmed through the cost structure of each medical department. As for the average customary charge of ultrasonography test conducted in each medical department, the department of obstetrics and gynecology charged 24,627 won, the department of radiology 53,179 won and the cardiac ultrasonography center 65,174 won. According to these results, the charges of ultrasonography test imposed by the department of radiology and the cardiac ultrasonography center wre enough to surpass break-even levels, but the charge imposed by the department of obstetrics and gynecology was not enough to offset the cost price. In conclusion, labor cost accounted for the largest proportion of cost price of ultrasonography test conducted in diagnosing diseases and performing surgeries in medical departments, followed by the fixed cost of ultrasonographic equipment depreciation cost. In medical department where the current charge of ultrasonography test turned out not to offset cost price through the break-even analysis of ultrasonographic equipment, ways to reduce fixed cost which accounts for the largest proportion of the cost price should be sought. Even medical departments whose current charge of ultrasonography test is enough to surpass break-even level are required to work for efficient management and cost reduction to continuously generate profits.

• Journal of Nutrition and Health
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• v.36 no.5
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• pp.515-527
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• 2003

Objectives： A meta-analysis of the literatures was conducted to evaluate the cost-effectiveness of medical nutrition therapy by dietitians. Methods : The 30 studies were identified from a computerized search of published research on MEDLINE, Science-Direct and the PQD database until May, 2002 and a review of reference lists. The main search terms were“dietitian”,“dietary intervention”,“nutrition intervention”, “cost”,“cost-effectiveness”and“cost-benefit analysis”. The subgroup analysis was performed by publication year, study design, intervention provider, type of patient (in/out-patient) and type of cost (total cost/direct cost). Two reviewers independently selected trials for inclusion, assessed the quality and extracted the data. Results : The 30 studies were identified using the electric database search and bibliographies. The 17 trials were eligible for inclusion criteria, then the systematic review and a meta-analysis were conducted on effectiveness and cost-effectiveness of medical nutrition therapy. The quality of the studies was evaluated using the quality assessment tool for observational studies. The quality score was 0.515 $\pm$ 0.121 (range : 0.279-0.711, median : 0.466). The meta-analysis of 17 studies based on the random effect model showed that medical nutrition therapy was highly effective in treating the diseases (effect size 0.3092 : 95% confidence interval 0.2282-0.3303). The vote-counting method, one of meta-analysis methods, was applied to evaluate the cost-effectiveness of medical nutrition therapy conducted by dietitians. Two criteria (method 1, method 2) for voting were used. The calculated p-values for method 1 (more conservative method) and method 2 (less conservative method) were 0.1250 and 0.0106, respectively. Medical nutrition therapy by dietitians was significantly cost-effective in the method 2. Conclusion. This meta-analysis showed that the effectiveness of medical nutrition therapy was statistically significant in treating disease (effect size 0.3092), and that the cost-effectiveness of medical nutrition therapy was statistically significant in the method 2 (less conservative method) of vote counting. (Korean J Nutrition 36(5): 515~527, 2003)

• Health Policy and Management
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• v.3 no.1
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• pp.25-52
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• 1993

Variation in the utilization of medical services is a very important issue in cost containment and quality assurance of health care. Practice variation directly affects health care expenditure especially in fee-for-service system, which is the payment system of health insurance in Korea. In addition to cost issue it is generally accepted that variations in medical practice and the cost of inpatient care suggest the possibility of inappropriate quality of care. This study is to closely examine the patterne and degrees of variation in cost structure of inpatient care among types of hospital and individual hospitals in some tracer diseases, and also to inquire into the service items which contribute much to the variation of total medical care cost. Foru common diseases, i.e. Cesarean Section, appendectomy, cataract extraction and pediatric pneumonia, were selected as tracer diseases. In most tracer diseases there were statistically significant differences in total medical care cost among hospitals in same type of hospital as well as among types of hospital(p<0.01). When total medical care cost were subdivided into the types of service, cost of medication and diagnostic examination varied the most prominenly. When the cost of medication were subdivided again, cost of parenteral antibiotics showed the most prominent variation. Of total medical care cost, medication was most contributory to the variation of total medical care cost(58.1~82.3%), and cost of antibiotics was most contributory to the variation of medication cost(63.9~92.2%). The results of study implicated that reducing the variation of medication may plays a significant role in containing the cost of inpatient care. In order to sort out the factors affecting practice variations including drug prescription pattes further researches are required.

• The Journal of Korean Physical Therapy
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• v.25 no.2
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• pp.43-48
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• 2013

Purpose: The aim of this study was to demonstrate that non-participation of physical therapists on the political decision-making committee results in invasion of their interests. Methods: To demonstrate the effects, we analyzed the change of medical insurance score decided by the Health Insurance Policy Deliberation Committee between 2001 and 2012 years, focusing on medical examination as the interest of the participation group and physical therapy cost as interest of the non-participation group. Results: Total medical insurance cost increased by 23.72%, on average. Medical examination cost increased by 23.90% and 37.66% in medical examination for new and established patients, respectively. However, physical therapy cost was reduced by 5.01%. The medical examination cost for physical therapy without medical checkup increased by 2.62%. Conclusion: This study shows that the physical therapy cost, related on the interest of the non-participative group in the Health Insurance Policy Deliberation Committee, rather decreased while the total medical insurance cost increased.These findings demonstrate the invasion of the non-participative group on the Health Insurance Policy Deliberation Committee. Thus, aggressive participation in political decision-making committee is necessary in order to protect and increase rights and interests of Korean physical therapists.

• Health Policy and Management
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• v.15 no.2
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• pp.1-15
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• 2005

The aim of this study was to compare medical cost of hospice care and that of conventional care during the last year of life, and identify factors that influenced the cost. From January to August 2003 592 terminal cancer patients receiving care from 5 hospice care units and 2 hospice care teams in general hospitals were enrolled to case group. Two hundreds and seventy two terminal cancer patients receiving conventional care from 7 general hospitals were enrolled to hospital-based control group, and 1,636 terminal cancer patients from 122 general hospitals located in same regions with the 7 hospitals were enrolled to community-based control. We used characteristics and medical cost from data of National Health Insurance Cooperation. Total medical cost per beneficiary in cases was about 10 millions won, 14.5 millions in hospital-based controls and 11.1 millions in community-based controls. The hospice care saved $45\%$ over the last year of life compared with hospital-based controls (p<0.0001). Saving of inpatient cost account for approximately $80\%$ of saving per beneficiary. Hospice care saved $29\%$ of medical cost per hospitalization day compared with hospital­based controls and $17\%$ compared with community-based controls (p<0.0001). Multiple regression analyses showed that hospice care significantly saved the medical cost. This study suggest that hospice care save medical cost compared with hospital-based control and community-based control. Most of saving of inpatient cost account for approximately $80\%$ of saving of medical cost.

• Health Policy and Management
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• v.28 no.4
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• pp.352-359
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• 2018

Background: The purpose of this study is to propose an analysis of trends and characteristics of high-cost patients who take over 40% of total national health insurance medical expenses. Methods: It has been analyzed the tendency of high-cost patients by open data based on the medical history information of 1 million people among national health insurance subscriber from 2002 to 2015. To conduct detailed study of characteristics of high-cost patients, multiple regression has been performed by sex, age, residence, main provider, and admission status based on the top 5% group. Results: The amount of medical expenses and the number of high-cost patients have gradually increased in decades. The number of high-cost patients for Korean won (KRW) 5,000,000 category has increased by 7.6 times, KRW 10,000,000 category has increased by 14.1 times in comparing of year 2002 and 2015. Top 5% medical expenses have increased by 4.6 times. In consideration of the characteristics of patients, the incidence of high medical expenses has been higher in female patients than male ones, the older patients than in the younger. Patients residence in Gyeonsang or Jeonla province have had a high incidence of medical expenses than other area. The disease including dementia, cerebral infarction, and cerebrovascular disease for high-cost patients has been also increased. Conclusion: The major increase factor for high medical expenses is the aging of population. The elderly population receiving inpatient care residing in the province that increases high medical costs have to management. There is an urgent need to develop a mechanism for predicting and managing the cost of high-cost medical expenses for patients who have a heavy financial burden.

• Quality Improvement in Health Care
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• v.2 no.2
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• pp.112-129
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• 1996

Background : A small number of high cost patients usually spend a larger proportion of scarce health resources. Aged, long-term care and readmitted patients usually belong to these high cost patient group. Among others, long length of stay and readmission can be reduced by checking its cause, and these are the areas needed most of quality improvement activity. Characteristics of high cost medical users between health insurance program and medical assistance program were reviewed. Methods : The inpatient claims of health insurance and medical assistance program were analyzed. Patients were divided by 6 groups; long-term, mid-term, short-term, readmitted, cancer and aged. We defined high cost patients as those who had spent one and half million won and over per 6 months. Characteristics of high cost patients for each group were reviewed. Results : medical assistance patients used much more resources than the insured members in the average hospital cost per case but less in daily hospital cost. The former had a longer length of stay and had much heavier diseases. Major diseases of both group were cancer, diseases of circulatory system and chronic degenerative diseases. Gallstone and schizophrenia were more in the insured program. However, pulmonary tuberculosis, asthma were more common among the medical assistance patients. Early readmission before 2 weeks were 28-30% of the total readmission. Readmission rate in the malignat neoplasm and renal failure were 80% and more. Q.A program should be installed to prevent unnecessary readmissions. Conclusion : Almost 30% of early readmissions and admissions due to complications and long length of stay should be reviewed carefully to keep cost down and to enhance the quality of hospital care.

• Health Policy and Management
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• v.8 no.2
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• pp.76-87
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• 1998

This study analyzed the effect of foreign currency exchange rate on the increasing rate of medical care cost by items of fee schedule of Korean Medical Insurance. This study uses the data of cost analysis including cost of imported goods and the data of for a university hospital National Federation's Medical Insurance for a trend of claim. The method of cost analysis is as same as that used in the study of the development of Korean RBRVS(Resource Based Relative Valus Scale). The main findings of this study are as follows; 1. The proportion of imported goods in cost related to Medical Insurance fee schedule is 7.93%, and in case of substitution of available domestic goods 6.96%. 2. If foreign currency exchange rate changes from 800wen per $1 to 1,300won, the affecting rate of Medical Insurance fee schedules is 5.00%. If the imported goods will be substituted with available domestic goods, the rate 4.35%. Our results can be used a data for updating Medical Insurance fee schedule. But this result is limited to be generalized, because this study used the cost analysis for a university hospital.