Journal of Healthcare Management - November/December 2014 - (Page 399)

Using Time-Driven ActivityBased Costing to Identify Value Improvement Opportunities in Healthcare Robert S. Kaplan, PhD, senior fellow and professor, emeritus, Harvard Business School, Boston, Massachusetts; Mary Witkowski, fellow, Harvard Business School, and MD candidate, Harvard Medical School, Cambridge, Massachusetts; Megan Abbott, MD, attending physician, Maine Medical Center, Portland; Alexis Barboza Guzman, project consultant, Institute for Cancer Center Innovation, Houston, Texas; Laurence D. Higgins, MD, chief, sports medicine and shoulder service, Department of Orthopedic Surgery, Brigham and Women's Hospital, Boston; John G. Meara, MD, DMD, director, Program in Global Surgery and Social Change, Harvard Medical School, and plastic surgeon-in-chief, Department of Plastic & Oral Surgery, Boston Children's Hospital; Erin Padden, operations coordinator, sports medicine and shoulder service, Brigham and Women's Hospital; Apurva S. Shah, MD, assistant professor, orthopedic surgery, Department of Orthopaedics and Rehabilitation, University of Iowa Hospitals and Clinics, Iowa City; Peter Waters, MD, John E. Hall professor of orthopedic surgery, Harvard Medical School, and orthopedic surgeon-in-chief, Orthopedic Center, Boston Children's Hospital; Marco Weidemeier, consultant, medical management, Schön Klinik, Prien am Chiemsee, Germany; Sam Wertheimer, senior policy associate, Massachusetts Health Policy Commission, Boston; and Thomas W. Feeley, MD, professor and division head, University of Texas MD Anderson Cancer Center, Houston, Texas E X E C U T I V E S U M M A R Y As healthcare providers cope with pricing pressures and increased accountability for performance, they should be rededicating themselves to improving the value they deliver to their patients: better outcomes and lower costs. Time-driven activity-based costing offers the potential for clinicians to redesign their care processes toward that end. This costing approach, however, is new to healthcare and has not yet been systematically implemented and evaluated. This article describes early time-driven activity-based costing work at several leading healthcare organizations in the United States and Europe. It identifies the opportunities they found to improve value for patients and demonstrates how this costing method can serve as the foundation for new bundled payment reimbursement approaches. For more information about the concepts in this article, contact Dr. Kaplan at rkaplan@hbs.edu. 399

Table of Contents for the Digital Edition of Journal of Healthcare Management - November/December 2014

Interview With Ninfa M. Saunders, DHA, RN, FACHE, President and CEO of Navicent Health
Career Management in Today’s Healthcare Environment
Using Time-Driven Activity-Based Costing to Identify Value Improvement Opportunities in Healthcare
Charity Care in Nonprofit Urban Hospitals: Analysis of the Role of Size and Ownership Type in Washington State for 2011
Management Involvement on the Board of Directors and Hospital Financial Performance
Social Media: How Hospitals Use It, and Opportunities for Future Use

Journal of Healthcare Management - November/December 2014