The document describes PARAS-Integrated ABC Module, an activity-based costing model for hospitals. The model identifies activities and assigns costs to products and services based on consumption. It breaks costs down into material packs, service costs, and apportioned overhead costs shared among activities. Hospitals need activity-based costing to understand costs in detail and ensure smooth functioning and sustainability.

1. PARAS-Integrated ABC Module

2. PARAS- Integrated ABC Module Activity Based Costing model that identifies activities in an organization and assigns the cost of each activity resource to all products and services according to the actual consumption by each Slide © 2010 Srishti

3. ABC Flowchart Slide © 2010 Srishti Services Services/ Activities Material Pack Apportioned Cost MP 1 MP 2 Service 1 Service 2 Service n Electricity cost Human Resource Others

4. Why Hospital needs Activity Based Costing? To know your business in and out ABC methodology assigns an organization's resource costs through activities to the products and services provided to its customers. To know the human resource cost in a hospital Since hospital is having so many activities/ services, the cost associated to each resource is huge and complex. The billing process is very complex thus calls for a robust ABC in place Slide © 2010 Srishti

5. Activity Based Costing You have many services inside a hospital Each service can have many services and activities The services and activities can be broken down to three component Material Pack Service Cost Apportioned cost Slide © 2010 Srishti

6. Material Pack Every activity has material pack E.g. In lab sample collection: Vials, gauges, syringes etc. are material pack The consumption of the material pack will be updated in real time with the current stock Slide © 2010 Srishti

7. Service cost Every activity is associated with its service cost The service cost is the cost for the resource who is administering the sample collection activity Slide © 2010 Srishti

8. Apportioned Cost Apportioned cost is the overhead cost shared by a number of activities/ services. The apportioned cost would be resource remuneration,rent, electricity cost, air conditioned cost etc. which is associated to manage the activity Utilization of resources- 70% of actual time/ effort/cost Slide © 2010 Srishti

9. ABC usage For a smooth functioning and to know the overheads, hospitals need Activity Based Costing The better the ABC usage the better the sustainability of the hospital Slide © 2010 Srishti

10. Question/ Feedback? Slide © 2010 Srishti

11. THANK YOU..!!! Slide © 2010 Srishti