Patient Level Information and Costing System

The main benefit of patient level costing is the ability to look in detail at the reasons why certain services are not achieving planned contribution.

Patient level costing can assist in identifying in a precise way those areas in which significant improvements can be made.  In order to change behaviour it is necessary for the individuals concerned to understand which aspects of their behaviour or practices need to change and why.  By providing an interactive analysis tool which enables them to become more aware of the cost implications involved, they will be more motivated to introduce any necessary changes.

Patient level costing can offer more detailed analysis than conventional service line reporting in 4 ways:

  • By breaking costs down into their cost components (wards, theatres, radiology, drugs, etc.), it is possible to see more clearly why a particular service is expensive (e.g. using branded rather than unbranded drugs or poor utilisation of theatre sessions)
  • Because each FCE has its own individual cost & contribution, it is easier to see whether a problem is due to a few isolated FCE's (outliers) or whether it affects the service as a whole.  Service line reporting reports average values and it is easy to miss the fact that a service that appears to be expensive may turn out to be lower than average cost if it were not for one exceptionally expensive FCE.  A histogram showing pictorially the distribution of individual FCE costs within an HRG or service is much more informative than a simple average.
  • Because costs are calculated at a very detailed level, these costs can be aggregated and sliced up in an almost limitless number of ways.  They can be summarised by HRG for National Reference Cost returns but can also be analysed by diagnosis, consultant, age, etc.  Ad-hoc queries can also be constructed e.g. to compare patients in a clinical study with the control group or to evaluate alternative clinic pathways.  Using top-down costing, this would involve an enormous amount of effort.
  • The results are more meaningful because they are based on actual rather than consultant estimates of resources used e.g. the actual radiology examinations performed rather than an estimate based on a profile.  So, if there is duplication of tests, this will show up.

Other benefits relate to:

    • Benchmarking comparisons
    • Income optimisation
    • Improved clinical coding
    • Increased clinician awareness of costs
    • Evaluating alternative clinical practices
    • Cost variance analysis
    • Resource planning
    • Internal recharging (of clinical support services)
    • Feeds for service line reporting
    • Producing National Reference Costs returns

Realcom is working with National Health Trusts to develop systems which deliver real benefits, costs savings and improvements in patient care. If you would like more information or discuss your particular requirements please phone or email

Contact Realcom Applications:   email -  telephone - 01530 440000
Froggarts Cottage, School Lane, Coleorton, Leicestershire, LE67 8HT

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