Activity-Based Costing (ABC) and its Contribution to Hospital Financial Sustainability: An Analysis of the Hospitalization Process in a Colombian Public Hospital

Abstract

This article analyzes the contribution of the activity-based costing (ABC) system to the financial sustainability of public hospital institutions, based on the study of the hospitalization process in a Colombian hospital. Unlike traditional approaches focused on cost estimation, this research adopts an analytical perspective aimed at evaluating the use of cost information in financial decision-making. Methodologically, a case study was developed with a quantitative approach, based on the identification of activities, allocation of resources through cost drivers and determination of the cost of the day of hospital stay as the object of analysis. The results show a high concentration of resource consumption in healthcare and administrative activities, as well as significant deviations between real costs and contracted rates, which affects the profitability of services. It is concluded that the ABC system not only improves the accuracy in the determination of costs, but also constitutes a strategic tool to strengthen financial planning, tariff negotiation and institutional sustainability in the health sector.