Standardization in Nursing Cost and Hospital Budget Planning

Presenter:

Abstract

Rationale:The ability to measure the true cost of nursing patients during their hospital encounter with an agreed upon standardized methodology has been fraught with many challenges.
Objectives: To develop a system to standardize nursing cost during the patients' stay in hospitals.

Methodology: The use of nursing workload measurement systems in combination with general ledger cost centre and payroll costs have been the preferred case costing/activity based costing approach to calculate nursing costs. This methodology has struggled with the perception of poor data quality and validity of nursing workload data as well as the reality that some high price components of care such as pharmacy ward stock costs are aggregated and arbitrarily allocated to patients using poorly correlated, but easily applied standards. The alignment or non alignment of nursing resource use and medical diagnosese based Case Mix Groups (CMG)/ Diagnostic Related Groups (DRG) further compounds the challenges. What is clear is that it is difficult to define the nurse-patient relationship by a set of tasks or interventions or merely by the use of a per patient day cost allocation.

It has been shown that the nursing cost during different episodes in care process such as intensive care unit, routine care unit and step down unit, etc are very varied. Length of stay is one important factor highly related to the nursing cost. To estimate the nursing cost, the expected ICU and other kinds of ward lengths of stay need to be estimated with adjustment for case mix group, acuity, and other factors. Semi-parametric regression models are applied in estimation of the expected length of stay during different episodes in care process. A nursing workload scoring model has been developed. The nursing costs are standardized by GLM (Generalized Linear Model) with adjustment for several factors such as nursing workload score, lengths of stay of different episodes, hospital type and location, etc.
To develop those models, the nursing workloads for cases as well as the patient care costs and patient medical history are collected.

Results: This methodology was applied in some types of hospitals. The standardized nursing cost assessment provided hospitals with more accurate information in hospital budget planning.

Conclusions:It is necessary to standardize the nursing cost during patients' stay in hospitals to allocate funds to nursing care fairly and efficently.