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In this week's GHA, you need to come up with how best to group the expenses by cost center in a hospital setting. For simplicity sake, think of a cost center as a "department". Cost centers allow the hospital to group expenses in a way that enables them to assess the financial performance of the various departments of the hospital. So, you need to sit back and think about what you know about how hospitals are organized. You might also find it helpful to search the internet and look for examples of different departments typically found in hospitals. For instance, some typical cost centers include: ICU, operating room, pediatrics, maternity, pharmacy, lab, etc.

Once you have a sense of the cost centers that would be involved with the type of expenses that are listed in the GHA, you just need to identify which of the costs should be allocated to which of the cost centers. You can create an excel table that demonstrates which costs belong to which cost center. As an example, costs like baby blankets, newborn nurse salaries, and infant formula might all be grouped to a cost center for Nursery.

Assignment Exercise 6-1: Grouping Expenses by Cost Center The Metropolis Health System's Rehabilitation and Wellness Center offers outpatient therapy and return-to- work services plus cardiac and pulmonary rehabilitation to get people back to a normal way of living. The Rehabilitation and Wellness Center expenses include the following: Nursing Salaries . Physical Therapist Salaries Occupational Therapist Salaries Cardiac Rehab Salaries Pulmonary Rehab Salaries Patient Education Coordinator Salary Nursing Supplies Physical Therapist Supplies Occupational Therapist Supplies Cardiac Rehab Supplies Pulmonary Rehab Supplies Training Supplies Clerical Office Supplies . Employee Education Required 1. Decide how many cost centers should be used for the above expenses at the Rehabilitation and Wellness Center 2. Set up a worksheet with individual columns across the top for the cost centers you have chosen 3. For each of the expenses listed above, indicate to which of your cost centers it should be assigned

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