title: The business of radiology: cost accounting.
abstract: Radiology practices confront questions of resource allocation every day. Unfortunately, practices frequently fail to adequately analyze revenues and expenses, which are at the heart of success or failure in any business endeavor. Cost allocation problems permeate nearly all aspects of cost analysis and accumulation and exist throughout all types of private-sector and public-sector organizations. "Managerial" or "cost" accounting is the discipline concerned with measuring and assigning the costs of delivering services or producing products. In contrast to financial accounting, management accounting produces relevant information for internal decision making and in general is designed to answer a firm's specific operational questions. Because costs play such a critical role in deriving and planning for revenues and profits, managerial accounting is in large part devoted to measuring and accumulating costs with the aims of control and continuous cost reduction. Because radiologists' salaries are at record highs, when accounting for a practice's clinical activities, such as the provision of mammography services, some allocation of radiologist costs themselves must be made, or the practice will not be able to achieve its goal of efficient allocation of resources. Whatever cost-accounting method is used should be specific enough to allow the differentiation of costs to as detailed a level as necessary for the strategic decision at hand. It is imperative that a practice use some rational method to gather and analyze costs and that management then use these data in decision making. Successful practices will be those most aware of their costs and the minimum acceptable reimbursements necessary for their success.
authors.affiliation: Department of Radiology, Carlisle Regional Medical Center, Carlisle, Pennsylvania, USA. ecamponovo@comcast.net
authors.forename: Ernest J
authors.initials: EJ
authors.lastname: Camponovo
mesh_terms: D000066:Accounting / Q000379:methods*; D003365:Costs and Cost Analysis / Q000379:methods*; D018803:Models, Economic; D011859:Radiography / Q000191:economics*; D011871:Radiology / Q000191:economics*; D011872:Radiology Department, Hospital / Q000191:economics*; D014481:United States