Oman Medical Journal (2011) Vol. 26, No.

5: 301-302
DOI 10. 5001/omj.2011.76

Editorial

How Much the Quality of Healthcare Costs? A Challenging Question!

Ismail Al Rashdi
Received: 15 Mar 2011/ Accepted: 26 Jun 2011
© OMSB, 2011

T o meet the economic challenges faced in the healthcare

industry and to continue to provide low cost and high quality
In fact, non-technical aspects of quality (such as altitude of
staff and their behavior), which may be more difficult to measure
services; healthcare organizations and private hospitals in and cost are more influential in patients’ rating of quality than
particular are striving to control operational costs. Thus, the technical aspects.7 In addition, since the patient perception
considering cost is essential in order to accomplish this. Costing of the quality of service covers all levels or parts of the healthcare
should promote cost effectiveness of medical practice, maximize organization; the overall satisfaction is based or influenced by all
the resources available to the healthcare provider by managing the the encountered experiences.8 When intangible costs of quality
services offered to patients, and explore opportunities for further are taken into account, the agreed expectations of patients which
improvements.1 are excessively identified in order to provide reasonable quality of
Traditionally, the cost of quality was considered from the care are difficult to determine and measure.
production oriented point of view where the quality costing There has been significant progress in standardizing the
process takes into account only the cost of deviation from the collection of expenditure data. However, there has not been much
specifications intended. In services such as healthcare; quality progress in establishing standard measures of program activities as
costing is more challenging due to the complexity of the processes activity based costs for health services. Information on the number
and the fact that such processes contain a wide range of costs, a lot of patients seen and the quality of services provided in a patient-
of which are intangible and hidden, particularly in not for profit oriented approach is often not available.
organizations. The cost of quality is measured by the cost paid by the hospital
Although the clinical practice in healthcare organizations or part of it, but it does not take into account the cost to the
of the public sector is evidence based with consideration to cost society, families, and other agencies such as court, foster care, and
effectiveness. However, the exercise of quality costing has not been police. Even if the healthcare provider is not charged or penalized,
taken seriously. Quality costing is given less attention in public there are costs for cooperation with investigators. Such costs may
healthcare for several reasons such as the complexity of some of be more difficult to estimate due to the variability of cases and
the costing methods and the limited resources to run such an complexity of such processes. Very often, the cost of training and
exercise. This is because health managers continue to separate experience or stress to staff is not considered, which may be very
finance when quality programs are introduced or because public difficult to estimate. On the other hand, saving on future costs as
healthcare providers perceive themselves sufficiently sheltered a result might help the society to improve the economy and reduce
from competition.2-4 crime rate for example, which may not be deducted.9
The three key challenges in producing rigorous cost information Apart from the financial costs, another aspect to consider is
about healthcare activities are the heterogeneity in the nature of human cost, namely; the failure in healthcare quality, which may
the cost objectives between and within health organizations, and be underestimated if the cost of quality is the main concern for
problems of information quality and variations in costing practices profit making organizations.
such as allocation of indirect costs.3 These challenges are related The issue of poor quality related litigation is still very narrow
to the complexity of the processes and the fact that such processes and it focuses only on physical injuries, deaths and other technical
contain a wide range of costs, a lot of which are intangible and quality related aspects, but it ignores functional quality related
hidden. issues such as insufficient counselling and poor communications,
Defining quality is one of the challenges facing today’s which may be very costly. There are no terms and conditions for
healthcare. Healthcare quality is described as having “uniquely functional quality breach which justifies litigation. The issue
intangible, variable and inseparable characteristics.”5,6 Thus of poor quality-related litigation focuses on the transfer of poor
measuring patient satisfaction (when cost of dissatisfaction to be health service costs back to the provider.
measured) is more important but also very complex. Unfortunately, the quality costs only focus on the cost to
the organization. While the cost to the patients who may have
Ismail Al Rashdi encountered failure in hospital services is not usually taken
Department of Child Health, Royal Hospital, P.O Box 1331, PC 111, Sultanate
of Oman.
into account. Examples include; travelling costs (revisiting the
E-mail: alrashdi.7@gmail.com hospital), time consumption (waiting areas), travelling costs for a

Oman Medical Specialty Board

302 Oman Medical Journal (2011) Vol. 26, No. 5: 301-302

second opinion and expenses for repeating investigations abroad Although quality costing is not a fundamental practice in
due to poor counselling, etc. public healthcare organizations, it may present solutions to reduce
Improving quality aims to virtually reduce the cost of services. waste and improve performance. Management of public healthcare
However, in health services in particular, it can be argued that or other non-profit organizations may not adopt this concept, but
efficiency of service can increase the throughput of patients by this attitude may change when facing increased costs of healthcare
increasing the associated costs. This conflict can be attributed to services coupled with limited resources. There are advantages to
the interests of managers. The question worth noting is: is it wise implementing quality costing, but not without its challenges, most
and possible to consider all costs? It may not be a healthy practice of all being that the concept is not well established yet as it is in
to insist on identifying controversial costs which may be challenged private sectors and other industries.
by mangers who doubt that they are quality related. Such practice
may undermine the role of quality costing in planning for the Acknowledgements
implementation of total quality management.
Pondering on quality issues using the economic concept (of The author reported no conflict of interest and no funding was
quality costing) may be opposed within health organizations for received on this work.
several reasons according to Ovretveit,10 such as:
• Clinicians are more concerned about clinical outcome without References
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