Describing Cost Analysis in the Clinical Laboratory

This version of the course is no longer available.
Need multiple seats for your university or lab? Get a quote
The page below is a sample from the LabCE course . Access the complete course and earn ASCLS P.A.C.E.-approved continuing education credits by subscribing online.

Learn more about (online CE course)
Describing Cost Analysis in the Clinical Laboratory

Cost analysis is the process of determining the price of doing laboratory testing. A cost analysis can be either a micro or macro study.
The micro cost analysis is performed to assess the cost of a specific test procedure. The information gathered can help determine whether a specific test should be added, retained, or eliminated from the test menu. It might also be helpful in determining if a new testing instrument or test kit for a specific test can be justified.
The micro cost analysis might be done for a cost center if the cost center was determined to have a cost per test index significantly exceeding other cost centers in the facility. If this is done, it may be unrealistically labor-intensive to do the micro cost analysis on every test. In this case, most laboratories would follow the "Pareto Principle" or 80/20 rule, which states that 20% of the laboratory's test menu accounts for 80% of the costs. In addition, a micro cost analysis is often done by purchasing a new test kit or analytical instrument. If the new kit or new instrument does not require additional labor, it does not need to be included in the study as it is a fixed cost.
The macro cost analysis is a study to assist in evaluating the overall efficiency and productivity of the laboratory and/or specific cost centers. To perform a macro cost analysis, the overall costs for the cost centers and entire laboratory need to be determined. This information is generally available through the institution's accounting department. In most instances, specific numbers are assigned for accounts payable laboratory expenses, which can often be separated into the various cost centers. It is helpful if the laboratory can work with accounting to identify which expenses need to be assigned to the various cost centers. If this has not been done, sorting out the accounts payable expenses assigned to the various cost centers can be challenging. In addition to the accounts payable, information labor costs are identified for all aspects of the laboratory operation. In some instances, indirect institutional costs are assigned based on space occupied by the laboratory and are included in the overall costs. However, since this is a fixed cost over time for simplification, it is often not included in the study.