TDABC: a powerful method for VBHC programs

The cost assessment method time-driven activity-based costing (TDABC) was proposed by Kaplan and Anderson in 2007 at the Harvard Business School as and advance from Activity based Costing method that allows more detailed direct and indirect cost accounting and data accuracy by identifying patient-specific resource consumption over the course of care trajectory. TDABC makes accurate cost analyses faster and easier to update by using estimates of two parameters: (i) the unit cost of resource inputs and (ii) the time and quantity of resources required to perform a transaction or an activity.

Porter and Teisberg in 2007 introduced the Value-Based Healthcare concept as outcomes perceived per patients divided by the costs of delivering those outcomes. However, successful implementation of VBHC requires an assessment of real healthcare costs. When properly designed and applied, the TDABC contributes by identifying opportunities to make patient episodes of care flow more efficiently by reducing the resources used in each activity based on real patient demand.

Although the advance and scale of the method use is happening, TDABC applied in microcosting studies in healthcare presents methodological differences and differences in how researchers report methods and results. The TDABC Checklist framework represents the initial point of the TDABC Consortium that aims to encourage reproducibility in TDABC studies, acknowledging the different variables which may influence cost analysis and the different ways in which TDABC has been implemented in microcosting studies around the world.