To gain an accurate picture of their profit-to-loss ratio, hospitals must accurately evaluate their costs. One of the most important—and challenging—factors to consider is the cost of a patient’s last day of stay. The first few days of a stay typically have higher costs because patients receive more intervention. The costs usually drop off after that. Determining the actual cost per day overall means calculating all the direct and indirect costs involved, including the cost of a patient’s last day of stay.
A leader in cost accounting software for hospitals, CostFlex has developed an SQL DSS Warehouse and Reporting tool to help hospitals determine the true per diem patient care costs. Knowing these costs allows hospitals to make important decisions about managing their resources to increase their bottom lines.
Patient Cost Per Day Analysis
The Kaiser Family Foundation recently published its Kaiser State Health Facts. This publication provides adjusted expenses per inpatient day in all 50 states. The statistics include all operating and non-operating expenses for registered hospitals. In 2020, the average cost per day for state and local government hospitals in the U.S. was $2,606. For non-profit hospitals, the figure increased to $3,032, and for-profit hospitals incurred an average of $2,300 in daily patient care expenses. Kaiser’s figures were adjusted higher to include an estimate of the total volume of outpatient services.
The Kaiser report may not paint the whole picture, however. Hospitals must also consider their average daily cost and how costs change as the length of stay (LOS) progresses. Using a sample of 191 inpatients and a LOS of six days, a CostFlex analysis showed that hospitals typically lose money on a per diem contract on Day 1. Still, the numbers drop below the average cost per day on subsequent days.
Hospitals must also analyze all factors involved in determining per-day costs to gain an accurate picture of their operating and non-operating expenses. Using the sample above, CostFlex found that the assumption that the total cost of an ICU room is $1,685 is inaccurate because it only accounts for nursing costs and ignores the many other costs involved in patient care.
It’s important for hospitals to have a robust solution to help them accurately track and analyze their per diem patient costs, including the cost of a patient’s last day of stay, so they can identify areas for improvement and increase profits.
CostFlex Has a Solution
Unlike other cost accounting software, CostFlex’s products are designed specifically for hospitals and healthcare organizations. The SQL DSS Warehouse and Reporting tool allows healthcare organizations to quickly gather, store, retrieve, and analyze large volumes of decision support system (DSS) data. Users can always generate reports, which helps them make informed decisions to drive performance and profitability.
CostFlex’s SQL DSS Warehouse and Reporting software integrates seamlessly with its Cost Accounting and Payer Contract Analyzer software. The single, easy-to-navigate interface allows users to export data for pinpointed metrics for administrative review quickly and efficiently.
A new feature in the SQL DSS Warehouse and Reporting tool also provides detailed cost-per-day figures broken down by Day 1, Day 2, and so on, up to and including the cost of a patient’s last day of stay. The system provides an effective method for tracking per diem inpatient costs and can help a hospital determine whether it’s more cost-effective to reduce a patient’s stay by one day.
CostFlex’s SQL DSS Warehouse and Reporting tool offers a powerful, turn-key solution to help hospitals determine the cost of a patient’s last day of stay. The system stores its data-driven reports in an enterprise data warehouse containing current and historical data. Hospitals can use the system to identify budgeting, provider performance, cost accounting, and revenue cycle management issues.
As an additional benefit, CostFlex software has lower staffing requirements than comparable programs on the market. This eliminates the need to invest in additional human capital, and CostFlex’s team of industry experts can help hospitals create customized solutions based on their specific needs.
CostFlex’s SQL DSS Warehouse and Reporting and the company’s full suite of cost accounting products for hospitals can help any healthcare organization accurately track and manage large volumes of data, including the cost of a patient’s last day of stay, to increase operational efficiencies and profits.