A TREE-STRUCTURE MODEL FOR ANALYZING LABORATORY TEST COSTS

A method of costing clinical laboratory tests is described in which total laboratory costs are apportioned into 3 components: an 'organizational overhead cost' to describe the costs of running an organization; a 'cost per episode' to describe the costs incurred per request; and a 'cost per test' to describe the actual analytical costs of tests performed. A tree-like structural model is described which allows for distribution of this 'cost per test' component to the contributing tests and the calculation of the true 'cost per test'. The implementation of this model on a computer spreadsheet has been achieved. When combined with the other cost components, the true total costs of laboratory testing can be determined for any particular test. The model also allows calculation of the incremental and marginal costs of a test and permits optimization of laboratory test frequencies and work-load to minimize laboratory analytical costs.