Question

Cost accounting is one of the most challenging areas in accounting to understand. “A cost accounting system is a system for recording, analyzing and allocating cost to the individual services provided to patients (e.g., medications, procedures, tests, room and board) (Becker's Hospital Review, 2014). The healthcare industry has been working toward the goal of correlating cost with quality. Read Porter, M. E., & Lee, T. H. (2016). From volume to value in health care: the work begins. Jama, 316(10), 1047-1048. Discuss how healthcare providers and patients can benefit when cost is correlated with quality of the healthcare services provided.

Answer 1

Discuss how healthcare providers and patients can benefit when cost is correlated with quality of the healthcare services provided.

The looks vice versa that costs are needed to increase the quality and increase the quality will lower down the costs. Low quality services tends to increase numbers of hospital readmissions which ultimately increase the costs of treatment. There are more chances of increase in complications during treatment due to low quality healthcare services which also put extra burden as it will increase costs.

Nowadays healthcare is becoming a high profile business. Rich People feel proud when they admitted to a costly hospital, where quality is same as a local hospital. Hospitals are luring people with not outcome but for the facilities they giving like in a hotel.In this all picture the poor is being perished. The poor go to that hospital that he will get quality services but he loose his hard earned money also. Healthcare and insurance both sectors making money but real purpose of healthcare left behind.

A value based approach is needed that patient have to pay per outcome. Here value is not price it is the reward for outcome of a patient. There will be a extra responsibility for healthcare providers to do there best,it will benefits in quality outcomes. People have to spend less in long term chronic diseases treatment in value based model. Healthcare providers will focus on value rather than volume, which ultimately increase the quality. Suppliers and manufacturer will align there products with the patient outcome with reduced costs and streamlined prices of drugs. Societies will become healthier and with these reduced costs government can provide extra benefits to the societies.