Benefits derived from capturing consumable supply costs by DRG as an input to physician practice pattern programs in military treatment facilities

Abstract

The study examines the benefits that can be derived by Military Treatment Facilities from capturing consumable supply costs by Diagnostic Related Groups. Civilian hospitals are capturing supply costs at the patient level using physician and Diagnostic Related Grouped specific cost accounting methods. Cost data captured in this manner can be combined with severity of illness adjusted clinical performance data, available through the facility's utilization management program, thus providing data required to execute a physician practice pattern program. Direct financial benefits can be derived from a physician practice pattern program. Indirect benefits to product line decisions and materials management can be derived from this type of program as well. Military Treatment Facilities can derive the same benefits as civilian hospitals by adopting a physician and Diagnostic Related Grouped specific cost accounting system. When this type of accounting system is combined with existing utilization management programs an effective physician practice pattern program can be executed and the benefits of this type of program may be realized.