Opportunities and challenges for implementing cost accounting systems in the Kenyan health system

Elesban Kihuba,Adrian Gheorghe,Fiammetta Bozzani,Mike English,Ulla K Griffiths

doi:10.3402/gha.v9.30621

Abstract

BackgroundLow- and middle-income countries need to sustain efficiency and equity in health financing on their way to universal health care coverage. However, systems meant to generate quality economic information are often deficient in such settings. We assessed the feasibility of streamlining cost accounting systems within the Kenyan health sector to illustrate the pragmatic challenges and opportunities.DesignWe reviewed policy documents, and conducted field observations and semi-structured interviews with key informants in the health sector. We used an adapted Human, Organization and Technology fit (HOT-fit) framework to analyze the components and standards of a cost accounting system.ResultsAmong the opportunities for a viable cost accounting system, we identified a supportive broad policy environment, political will, presence of a national data reporting architecture, good implementation experience with electronic medical records systems, and the availability of patient clinical and resource use data. However, several practical issues need to be considered in the design of the system, including the lack of a framework to guide the costing process, the lack of long-term investment, the lack of appropriate incentives for ground-level staff, and a risk of overburdening the current health management information system.ConclusionTo facilitate the implementation of cost accounting into the health sector, the design of any proposed system needs to remain simple and attuned to the local context.

Highlights

The adoption of cost accounting systems in the health sector gained momentum in the late 1980s as a pivotal step in health financing reforms (1Á3)
The vision of the government is for every Kenyan to have access to quality health services
Our study identified a number of opportunities and strengths in relation to the viability of a cost accounting system in Kenya Á in particular, durable political commitment to digitalization in healthcare, a broad and expanding health management information systems (HMIS) infrastructure, as well as a recognized interest from policy makers and practitioners at all levels for relevant unit cost data

Summary

Introduction

The adoption of cost accounting systems in the health sector gained momentum in the late 1980s as a pivotal step in health financing reforms (1Á3). Such systems collect clinical, financial, and human resources data from health service providers across multiple health information systems (HIS) and summarize the data in monetary terms based on a set of predefined units of costing [4]. A recent review limited to high-income countries identified substantial transnational differences in health sector cost accounting practices in terms of data collection (scope, frequency, data sources, and validation rules) and methodology (e.g. structure of cost centers and approaches to valuation) [6]. Conclusion: To facilitate the implementation of cost accounting into the health sector, the design of any proposed system needs to remain simple and attuned to the local context

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Conclusion