Healthcare Cost Containment: A Survey Of Healthcare Financial Managers

Abstract

Federal and state governments, as well as third party payees, have created incentives for cost containment policies within healthcare settings. The purpose of this study is to determine the extent healthcare financial managers (HCFMs) believe various healthcare reform measures and cost containment strategies are effective and to descriptively compare the perception of effectiveness by type of organization (for profit, not for profit, and outside CPA/consulting firm). Eighty-four HCFMs, from 36 states, agree that the majority of healthcare reform measures are moderately or very effective. In general, accounting practices that HCFMs have direct decision making authority over were deemed effective (i.e. accounting systems that reduce administrative costs) regardless of type of agency employed. Surprisingly, accounting systems that provide more accurate allocation of indirect-overhead costs were not considered effective by not-for profit organizations. On the other hand, analyzing variances between expectations and actual cost/revenue, closely monitoring supply and equipment costs, and reducing administrative costs were rated effective by all three groups.