ABF Costing: What it means at various levels
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1 ABF Costing: What it means at various levels Christopher Jackson Manager, Decision Support Unit Royal Children s Hospital Melbourne HFMA Lorne 15 th November
2 Royal Children s Hospital Major metropolitan specialist paediatric health service. Located in Royal Park, Melbourne since Campus and precinct partners include MCRI, the University of Melbourne and the VCCC. State-wide major trauma centre and Nationally Funded Centre for cardiac and liver transplantation. In 2016/17 there were: Over 45,000 acute separations. Over 75,000 ED presentations. Over 300,000 outpatient attendances. Significant rehabilitation and mental health activity. More than 3,000 FTE staff employed. About 330 beds open. Went live with Epic EMR in April
3 What is ABF Costing? ABF pricing should support dynamic efficiency and changes to models of care with the ready transferability of funding between different care types and service streams through a single unit of measure and relative weights. = National Weighted Activity Unit Health Policy Solutions, Casemix Consulting and Aspex Consulting, Activity based funding for Australian public hospitals: Towards a Pricing Framework, IHPA: 2011, p.6. 3
4 Casemix funding was introduced to Victoria in July Followed several years of clinical coding development in which casemix concepts were matured. From the start, clinical costing was devolved in Victoria. The Clinical Costing Standards Committee began in January 1997 within the Victorian Department of Health. In 2001 the Standards Committee was incorporated as the Clinical Costing Standards Association of Australia. Authoring of the standards was conducted by hospital members. Participation sought from all states and territories. 4
5 Clinical costing was implemented to generate cost weights, introducing three funding models: Acute inpatients WIES (1993) Rehabilitation CRAFT (1996) Specialist clinics VACS (1998) The more complex episodes are easier to cost because there is more information collected about them. It is driven by clinical needs. Information is never collected just for costing. 5
6 Activity Based Funding commenced nationally from 1 st July Costing became a zero sum game for hospitals: shifting costs between treatment streams achieves no net benefit. All expenses had to be allocated somewhere: Allocated to patient activity where data is available. Allocated to an aggregate episode where no data exists. Reconciled to the GL with explanations. National ABF reduced influence of any single hospital. Work in progress initially excluded. Raised concern about consistency between states. Management refocused from performance to cost. 6
7 How well have hospitals responded to the demands of ABF costing? Victoria was not a greenfield site for ABF costing. Costs were reported by hospitals at CCSAA cost bucket level and could not be mapped to the NHCDC categories. States with larger LHNs centralised data and standards. Data output increased but not necessarily staff. DHHS continued to set budgets according to its own funding models: To qualify for growth funding, specified grants were reduced. Pressure was increased to provide cost data for ABF. 7
8 Are we making the most of clinical costing for ABF? Bundled episodes vs patient services? 8
9 CCSAA Cost Buckets AHPCS V3.1 Bucket Cost GL Account Code Mapping to Line Items EpisodeNumber IP Code Name EncounterType I SWNurs Nursing, Salaries and Wages VCDCProgram A SWMed Medical, Salaries and Wages (non VMO) StartDate 18/08/2014 SWVMO Medical, Salaries and Wages (VMO) StartDateTime 16:00.0 SWAH Allied Health, Salaries and Wages EndDate 21/08/2014 SWOther Other staff types, Salaries and Wages EndDateTime 30:00.0 OnCosts Labour (staff) oncosts, all staff types TotalCost $ 13, Path Pathology AlliedHealth $ Imag Imaging ED $ - Pros Prostheses (surgically implanted) HITH $ - MS All other medical and surgical supplies (excluding prostheses and drugs) ICU $ - GS All other Goods and Services Imaging $ - PharmPBS Drugs PBS (eg high cost and S100) MedNonSurg $ 4, PharmNPBS Drugs Non PBS MedSurg $ 1, Blood Blood Products Nursing $ 1, DeprecB Building Depreciation Other $ - DeprecE Equipment Depreciation Pathology $ - Hotel Hotel Goods and Services Pharmacy $ Corp Corporate costs (from outside the hospital GL and not otherwise specified) PharmS100 $ - Lease Leasing costs PharmPBS $ - Cap Capital works - not in scope Prostheses $ - Exclude Excluded costs not in scope TheatreOR $ 3, TheatreNonOR $ - 9
10 Internal Services/Utilisation Episode No Service Start Service End Day of Stay Area Service/Utilisation Volume Type Volume Service Cost IP /08/ :16 18/08/ :16 1 A0352-PossumWard PharmWardImprest-E3S-D03Z(7.0) Quantity 0.04 $ 0.01 IP /08/ :16 18/08/ :59 1 A6552-Plastics PharmUnitImprest-PLS-N4P-D03Z(7.0) Quantity $ 2.52 IP /08/ :16 18/08/ :59 1 A6552-Plastics Unitbeddays-PLS-Z-E3D-D03Z(7.0) Quantity $ 1, IP /08/ :16 18/08/ :59 1 R0152-PatFood Catering-N4P-Overnight Quantity 40 $ IP /08/ :16 18/08/ :16 1 A0352-PossumWard Wardbedday-E3S-Z-D03Z(7.0) Quantity 0.72 $ 0.52 IP /08/ :17 18/08/ :50 1 A8202-Day surgery nursing Wardbedday-E3D-Z-D03Z(7.0) Quantity $ IP /08/ :17 18/08/ :50 1 A8202-Day surgery nursing PharmWardImprest-E3D-D03Z(7.0) Quantity 5.14 $ - IP /08/ :13 18/08/ :27 1 A8002-Operating theatre Proc Quantity 36 $ 1, IP /08/ :13 18/08/ :27 1 A8253-Anaesthetic Technicians AnaesTech-Z Duration 4556 $ IP /08/ :13 18/08/ :27 1 A8002-Operating theatre TheatreNurse-PLS Duration 2412 $ 1, IP /08/ :13 18/08/ :27 1 A8252-Anaesthesia Anae-TH06 Duration $ 2, IP /08/ :13 18/08/ :27 1 A6577-PlasticsOR Surg-PLS Duration $ 1, IP /08/ :46 18/08/ :59 1 A1610-Platypus ward Wardbedday-N4P-Z-D03Z(7.0) Quantity $ IP /08/ :46 18/08/ :59 1 A1610-Platypus ward PharmWardImprest-N4P-D03Z(7.0) Quantity $ 7.76 IP /08/ :00 19/08/ :59 2 A6552-Plastics Unitbeddays-PLS-Z-E3D-D03Z(7.0) Quantity 936 $ 2, IP /08/ :00 19/08/ :59 2 A1610-Platypus ward PharmWardImprest-N4P-D03Z(7.0) Quantity 48 $ IP /08/ :00 19/08/ :59 2 R0152-PatFood Catering-N4P-Overnight Quantity 40 $ IP /08/ :00 19/08/ :59 2 A6552-Plastics PharmUnitImprest-PLS-N4P-D03Z(7.0) Quantity 48 $ 5.84 IP /08/ :00 19/08/ :59 2 A1610-Platypus ward Wardbedday-N4P-Z-D03Z(7.0) Quantity 888 $ IP /08/ :00 20/08/ :59 1 A5477-GynaeOR Surg-L SIVAPATHAM Duration 360 $ IP /08/ :00 20/08/ :59 48 A5506-CCC-Molecular Diag VCGSPath-VCGS ActualCharge 248 $ IP /08/ :00 20/08/ :59 3 R0152-PatFood Catering-N4P-Overnight Quantity 40 $ IP /08/ :00 20/08/ :59 3 A6552-Plastics Unitbeddays-PLS-Z-E3D-D03Z(7.0) Quantity 936 $ 1, IP /08/ :00 20/08/ :59 3 A6552-Plastics PharmUnitImprest-PLS-N4P-D03Z(7.0) Quantity 48 $ 4.82 IP /08/ :00 20/08/ :59 3 A1610-Platypus ward PharmWardImprest-N4P-D03Z(7.0) Quantity 48 $ IP /08/ :00 20/08/ :59 3 A1610-Platypus ward Wardbedday-N4P-Z-D03Z(7.0) Quantity 888 $ 1, IP /08/ :00 21/08/ :30 4 A1610-Platypus ward PharmWardImprest-N4P-D03Z(7.0) Quantity 23 $ IP /08/ :00 21/08/ :30 4 R0152-PatFood Catering-N4P-Overnight Quantity 40 $ IP /08/ :00 21/08/ :30 4 A1610-Platypus ward Wardbedday-N4P-Z-D03Z(7.0) Quantity $ IP /08/ :00 21/08/ :30 4 A6552-Plastics PharmUnitImprest-PLS-N4P-D03Z(7.0) Quantity 23 $ 2.55 IP /08/ :00 21/08/ :30 4 A6552-Plastics Unitbeddays-PLS-Z-E3D-D03Z(7.0) Quantity $
11 Do we need costs? Revenue? Why not integrate clinical costing with other reporting and management processes? 11
12 Matching of datasets: VAED/WIES: Clinical costing now part of the annual reconciliation process. Specialist clinics/wase: Cost data are being used to assess the new funding arrangements. Mental health: Most Victorian sites use the CMI mental health state collection. The VCCUG mental health standards committee shares data quality results with DHHS mental health staff. As datasets expand a reciprocal synergy will develop. IHPA similarly is reducing duplication of data collection and matching cost results to mandatory collections. 12
13 Leveraging the value of the cost data. Allocating at the episode level is important. Calculating the revenue is relatively simple technically. Identifying patient targets for some revenue streams is difficult. Comparing funding streams subject to recall helps assess performance to target. Integration of billing systems can improve accuracy. Revenue and cost allocations provide complementary validation. 13
14 EMR offers the chance to allocate costs for specific clinical interventions. Overcoming flat bedday costs in wards. Improving attribution of costs to units. The need to record data for clinical reasons guarantees it is available for driving cost allocations. Acuity algorithms can be built on total patient data. 14
15 Understanding a new system takes time: The full benefits of the EMR for clinical costing and other areas are still being realised. Data is not information: Understanding what all the new data points captures mean and how they reconcile with past information can be a challenge. Define clinical costing needs from the start: Involving clinical costing from the start of system implementation will deliver information needs at a lower cost than retrofitting the system later for reporting. 15
16 Medical precincts and shared services will increase the complexity of data integration. Costing services where the patient is not present. Costing complications: integrating quality datasets. Aligning clinical needs with financial needs: new technology should meet the needs of both. Casemix funding has shown that it can develop as systems of how to describe hospital activity evolve. - Stephen Ducket, A Decade of Casemix Funding in Victoria,
17 ? 17
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