Activity based costing of diagnostic procedures at a nuclear medicine center of a tertiary care hospital

CONTEXT: Escalating health care expenses pose a new challenge to the health care environment of becoming more cost-effective. There is an urgent need for more accurate data on the costs of health care procedures. Demographic changes, changing morbidity profile, and the rising impact of noncommunicable diseases are emphasizing the role of nuclear medicine (NM) in the future health care environment. However, the impact of emerging disease load and stagnant resource availability needs to be balanced by a strategic drive towards optimal utilization of available healthcare resources. AIM: The aim was to ascertain the cost of diagnostic procedures conducted at the NM Department of a tertiary health care facility by employing activity based costing (ABC) method. MATERIALS AND METHODS: A descriptive cross-sectional study was carried out over a period of 1 year. ABC methodology was utilized for ascertaining unit cost of different diagnostic procedures and such costs were compared with prevalent market rates for estimating cost effectiveness of the department being studied. RESULTS: The cost per unit procedure for various procedures varied from Rs. 869 (USD 14.48) for a thyroid scan to Rs. 11230 (USD 187.16) for a meta-iodo-benzyl-guanidine (MIBG) scan, the most cost-effective investigations being the stress thallium, technetium-99 m myocardial perfusion imaging (MPI) and MIBG scan. The costs obtained from this study were observed to be competitive when compared to prevalent market rates. CONCLUSION: ABC methodology provides precise costing inputs and should be used for all future costing studies in NM Departments.