Which phase's objective is to determine the total allowable cost of direct patient care departments?

The objective of Phase II is to determine the total allowable cost of direct patient care departments. This phase typically focuses on the analysis and identification of costs that can be directly attributed to providing care to patients. By establishing these costs, healthcare organizations can gain insights into cost allocation, efficiency, and budgeting for patient care services. Understanding the total allowable costs is essential for effective financial management, ensuring that resources are appropriately allocated and that care delivery remains sustainable.

In the context of healthcare finance, each phase of cost determination usually builds upon the previous one, starting with a broader understanding of costs before narrowing down to more specific costs associated with direct services. This structured approach allows institutions to ensure regulatory compliance, optimize financial performance, and facilitate strategic planning.