TY - JOUR
T1 - Hospital Supply Expenses
T2 - An Important Ingredient in Health Services Research
AU - Abdulsalam, Yousef
AU - Schneller, Eugene
N1 - Funding Information:
We thank the members of the Health Sector Supply Chain Research Consortium for providing their feedback and support throughout this project. We also thank the Kuwait Foundation for the Advancement of Science for the financial support that was provided.
Funding Information:
The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was supported by the Kuwait Foundation for the Advancement of Science (KFAS) (Grant Number P115-67IM-01).
Publisher Copyright:
© The Author(s) 2017.
PY - 2019/4/1
Y1 - 2019/4/1
N2 - The purpose of this article is to shed light on hospital supply expenses, which form the second largest expense category after payroll and hold more promise for improving cost-efficiency compared to payroll. However, limited research has rigorously scrutinized this cost category, and it is rarely given specific consideration across cost-focused studies in health services publications. After reviewing previously cited estimates, we examine and independently validate supply expense data (collected by the American Hospital Association) for over 3,500 U.S. hospitals. We find supply expenses to make up 15% of total hospital expenses, on average, but as high as 30% or 40% in hospitals with a high case-mix index, such as surgery-intensive hospitals. Future research can use supply expense data to better understand hospital strategies that aim to manage costs, such as systemization, physician–hospital arrangements, and value-based purchasing.
AB - The purpose of this article is to shed light on hospital supply expenses, which form the second largest expense category after payroll and hold more promise for improving cost-efficiency compared to payroll. However, limited research has rigorously scrutinized this cost category, and it is rarely given specific consideration across cost-focused studies in health services publications. After reviewing previously cited estimates, we examine and independently validate supply expense data (collected by the American Hospital Association) for over 3,500 U.S. hospitals. We find supply expenses to make up 15% of total hospital expenses, on average, but as high as 30% or 40% in hospitals with a high case-mix index, such as surgery-intensive hospitals. Future research can use supply expense data to better understand hospital strategies that aim to manage costs, such as systemization, physician–hospital arrangements, and value-based purchasing.
KW - hospital costs
KW - supply chain management
KW - supply expense
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U2 - 10.1177/1077558717719928
DO - 10.1177/1077558717719928
M3 - Article
C2 - 29148349
AN - SCOPUS:85042363074
SN - 1077-5587
VL - 76
SP - 240
EP - 252
JO - Medical Care Research and Review
JF - Medical Care Research and Review
IS - 2
ER -