Application Research Of Target Costing In Health Management

With the rapid development of the economy, people’s life is to reach the well-to-do level of the Chinese nation while the medical and health service industry is relatively developing slowly. People are complaining about difficulty and high cost of getting medical service, higher demands are called as they are concerning more about their living quality. Health management emerges as the social background. More and more people start paying attention to their health issues while the health management system is incomplete with few organization having efficient ladders. It has been a serious problem that how to regulate and control the health management industry to make real contribution to the nation’s health service.For better survival in the fiercely competitive industry, health management enterprises should enhance their hardware and software, concerning not only the efficient managing theory, but also the ideas of cost control and to satisfy the customers’ demand. The health industry of our country is in transition, so it is a good opportunity to set up the people’s spontaneous consciousness of health management. Providing low cost and effective health service is an important mean to laying a solid foundation for the health management industry. How to reduce the cost and to put key emphasis on the service, to improve sub-health and to prevent disease is an important problem in the development of health management industry.Target costing is an effective way to control the cost from the inner of the enterprise; the aim is to provide better health management service as well as keeping the speed of development. Target costing requires integrated survey on the marketing environment before providing products and services to determine price and service procedure, unifying own target profit to set whole target cost. The method also decomposes total target cost to implement tasks to the according aspects within the enterprise, and assure to achieve the target through feedback and system of awards and penalizations. Target costing is a scientific, full process and all staff participating method, it can optimal use available resources and maximum increase benefit and competitive force to provide efficient management service.The article is a theoretical study on the administration cost controlling and health management service cost controlling of health management organization, through studying basic theories of health management and target costing. Also, some problems appeared during the research process are put forward and solutions were provided. At last the author introduces the application of target costing in health management taking Osteoporosis for example.Health management industry is a rising industry and with large marketing demand, the article is only a theoretical study, and hopes to improve in practical use. The application of target costing in health management is a new direction; it combines economics, management, accounting and medical science with health management and which is an inevitable direction of the development of health management industry. It requires us to keep studying and trying to improve the method in practice. The health management industry will have flourishing development in the future as long as we are brave enough to reform and innovate.