TIME-DRIVEN ACTIVITY-BASED COSTING IN THE OPHTHALMOLOGY DEPARTMENT OF STATE HOSPITAL: A CASE STUDY

Abstract

Today, competition is becoming increasingly intense throughout the world, and traditional cost methods fail to provide the information necessary for the sustainability of businesses. This information is of vital importance regarding the decision-making process in business management. As is the case in all businesses, successful management decisions are associated with accurate cost information. For hospital administrations to be able to handle the decision making and control functions both effectively and efficiently, and to be sustainable, they have to be completely familiar with the costs of their health services. For this reason, the use of Time Driven Activity Based Costing (TDABC), a modern cost method, has become important to obtain more accurate and realistic cost information in evaluating health care interventions in complex hospital businesses. In this study, information on TDABC has been presented and a summary has been given on what needs to be done to increase the success of the method. Subsequently, studies on TDABC have been discussed and a case study sample application has been carried out. This study aimed to show why the TDABC method is applicable and how it can be efficiently applied. The study was carried out at the ophthalmology department of a state hospital, and the costs of five surgical procedures which performed on under local anesthesia, fluorescein fundus angiography (FFA) and laser treatments (argon laser photocoagulation, Nd:YAG (neodymium-doped yttrium aluminum garnet) laser capsulotomy-synechiotomy, electrolysis (via argon laser) applied in distichiasis), per patient were calculated according to the TDABC method. As a result, the study showed that the TDABC method can be applied in hospital businesses to obtain accurate cost information, and it is useful in helping hospital management to make strategic decisions. Also, hospital businesses will be able avoid waste of resources by calculating their costs in a realistic way through TDABC method, which will also contribute positively to the environment as the use of medical supplies and the amount of medical waste will be reduced. In addition to all these, it is believed that the study will be motivating and guiding for other hospital businesses realistic cost calculation and therefore it will be beneficial for the society.