The six steps to making the right decisions for clinical costing

Clinical costers have a role to make complex yet crucial decisions which will affect the financial viability of a hospital. Their decisions need to be timely and accurate to ensure financial safety. Luckily, there are set systems which assists the clinical costers to make the right decision or give the right advice. Clinical costers can rely on the ‘Clinical Costing-oriented Decision Making Model’.

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The ‘Clinical Costing-oriented Decision-Making Model’ consists of six steps, including:

  1. Identify objectives

    Clinical costers and other decision makers collaborate to clarify what are the objectives before preparing clinical costing analyses and reports.

  2. Investigate alternatives

    In order to achieve the objectives that was decided in the earlier stage of the decision-making process, clinical costers need to look at alternatives. When potential alternatives are found, clinical costers need to analyse growth rate, market share and future cash flow for the strategies.

  3. Confirm the action

    The decision that have been made need to be timely, an appropriate action plan based on the value-based care also needs to be made.

  4. Implement the action

    This step starts with the creation of a budget. It is a financial plan for the future with information on expenses, revenue, cash flows and profit and loss statements. After this step, hiring new staff or purchasing new equipment could be included when budget is finalised.

  5. Evaluate outcomes

    During the evaluation phase, a comparison of actual and planned clinical and financial outcomes is undertaken to confirm whether the action taken met the objective.

  6. Correct weaknesses

Clinical costers need to work together with clinicians and service managers to find what is not working and correct the identified weaknesses. This step ensures that the original aim is fulfilled.

Dr. Ronald Ma, Clinical Costing Analyst for Austin Health, have collaborated with The University of Melbourne – Mobile Learning Unit to talk more about this decision-making model through an online course called Clinical Costing Fundamentals & Analyses. In this course, Dr. Ronald Ma discusses thoroughly about the theory, philosophy and the practice of clinical costing systems and databases.

To learn more about this course, please visit the website below

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Mobile Learning Unit


  • Clinical Costing