Use of a Cost Accounting System to Evaluate Costs of a VA Special Program

BACKGROUND: The Department of Veterans Affairs (VA) established six mobile clinics to provide care for rural veterans. Each was operated by a parent VA Medical Center (VAMC). OBJECTIVE: To describe the use of a cost-accounting system which does not provide costs at the service or patient level to determine the costs of the mobile clinics. RESEARCH DESIGN: Costs per visit were compared among the mobile clinics with the parent VAMCs and with simulated fixed-location clinics. Cost data came from VA's Centralized Accounting for Local Management (CALM) data. Utilization data came from VA's outpatient file. RESULTS: Information was obtained from the VAMCs' fiscal services to reallocate costs among the CALM subaccounts to generate cost data that was comparable among the mobile clinics. Costs per visit for the mobile clinics were twice as high as those of the parent VAMCs. Costs per visit would be lower at fixed-location clinics unless the volume were substantially less than that provided by the mobile clinics. CONCLUSION: Differences between cost allocations for accounting purposes and research are likely to necessitate adjusting cost accounting data for research purposes. Fortunately, information from the accountants or primary data can lead to a cost database which is appropriate for research evaluations. In the mobile clinics study, the analysis of cost accounting data led to the conclusion that mobile clinics were not a cost-effective way in which to provide care to rural veterans.