Case | HBS Case Collection | March 2012 (Revised January 2013)

Boston Children's Hospital: Measuring Patient Costs

by Robert S. Kaplan, Mary L. Witkowski and Jessica A. Hohman


The case describes two pilot projects on applying activity-based costing to measuring the cost of treating patients. It presents process maps and financial data relating to the processes used during (1) an office visit to a plastic surgeon for three different diagnoses and (2) application and removal of three different casts in the orthopedic cast room. Students calculate and compare the costs and margins of the three procedures at the two different sites using the hospital's existing cost system and a proposed new system based on time-driven activity-based costing.

Keywords: health care; Time-Driven Activity-Based Costing; Costing; Hospitals; Activity Based Costing and Management; Mathematical Methods; Health Industry;


Kaplan, Robert S., Mary L. Witkowski, and Jessica A. Hohman. "Boston Children's Hospital: Measuring Patient Costs." Harvard Business School Case 112-086, March 2012. (Revised January 2013.)