Expanding the role of managerial accounting for health services: The case of filmless radiology

In a world of limited resources, choice among competing plans is inevitable. Oftentimes, decision-makers have to reply on policy analyses of the costs and benefits of the available options. However, the economic values attached to them may not always reveal their relevant or intrinsic worthiness. Accounting theory does not furnish a body of uniformly accepted conclusions immediately applicable to policy or decision-making needs. It is a method rather than a doctrine, an apparatus of the mind, a technique of logical thinking that helps the decision-makers to draw relevant and reliable conclusions.; This study presents a refined multi-standpoint model for various stakeholders in the health services. It is derived from the Balanced Scorecard methodology in accounting research. It streamlines economic analysis into five standpoints: clinical factors, productivity, financial profitability, cash flow position and managerial and other factors. This model is then applied as an example to the economic evaluation of a new technology--picture archiving and communication system (PACS). The template format demonstrated is however not limited to the evaluation of PACS. It can be expanded to similar decision-making assessments, with appropriate adjustments for selecting relevant and reliable accounting and other information.; The PACS financial evaluation shows that, under best estimations of information available today, if a private healthcare provider was to purchase the same configuration as the Baltimore Veterans Administration Medical Center (BVAMC) today (same service mix, staff productivity pattern and other demographic factors), the cash flow pay back period would be about three years, the break even annual volume would be 150, 551 relative value units (using BVAMC technologist workload weight scale and assuming 10 years depreciation method), and its break even PACS-specific unit cost would be {dollar}9.87 per RVU plus PACS-specific incidental costs. These numbers are subject to change on many factors and assumptions, and users should replace the figures with their own numbers to calculate meaningful output relevant to their decision-making purposes.