Strategies to reduce costs and increase revenue in hospitals: a mixed methods investigation in Iran

Abstract

Introduction

The financial stability of hospitals directly impacts their ability to fulfill their primary mission of enhancing healthcare. This study identifies and prioritizes cost reduction and revenue enhancement strategies for Iranian hospitals.

Method

This investigation employed a mixed-methods design, incorporating both qualitative and quantitative approaches. A systematic review of scholarly articles was initially conducted to identify key strategies for cost reduction and revenue enhancement in hospitals. Insights from hospital administrators regarding successful practices and recommended financial improvement measures were subsequently collected through surveys. The combined strategies from these phases were then assessed and ranked using the TOPSIS technique.

Findings

This study identified 12 primary strategies and 71 sub-strategies across four dimensions. Notably, strategies aimed at enhancing the quality of care (0.9030), refining process quality (0.7926), and bolstering care provision infrastructure (0.7910) were deemed the most critical. Among the sub-strategies, priority was given to implementing a comprehensive health information system (HIS) (0.7926), identifying and reducing the causes of cancelled surgeries and visit appointments (0.7919), and developing strategies to decrease hospital infection rates (0.7854).

Conclusion

Enhancing the quality of care and upgrading service delivery processes are crucial for improving hospitals' economic performance. Elevating service quality not only improves the economic performance of hospitals but also enhances their financial metrics.

Introduction

Escalating healthcare expenses, particularly hospital charges worldwide, have prompted health economists and medical professionals to explore innovative approaches to curtail and manage costs [1]. Despite economic and social transformations in developing nations, the healthcare industry continually strives to transition to an envisioned state of efficiency and effectiveness. However, medical facilities in developing countries face numerous financial challenges, including deficiencies in cost accounting systems, inadequate service pricing, an inability to achieve a sustainable profit margin, delayed reimbursements from insurance entities, ineffective financial oversight, and insufficient comprehensiveness in financial reporting [2].

As key healthcare providers, hospitals play a crucial role in the economy of the healthcare sector. This significance is amplified in developing countries due to their economic fragility and susceptibility to market fluctuations [3]. Consequently, reducing avoidable expenses and increasing revenues are paramount objectives for hospital administrators in these countries, as they seek to rectify financial disparities and attain stability. Ensuring adequate resources for hospital management and overseeing their financial status have consistently been focal points for hospital leadership [4].

In the realm of healthcare services, the prevailing notion is that prevention should precede treatment. Unfortunately, neglecting this principle has resulted in frequent hospital visits and exorbitant treatment expenses. Escalating healthcare costs pose a significant challenge for many nations, particularly those in the developing world [5, 6]. Data indicate that in Iran, healthcare expenditures surged by 26% from 2002 to 2011, with healthcare costs accounting for 5.8% of GDP. Notably, hospitals accounted for 42% of healthcare expenses during this period, with nearly half of these costs being directly borne by households. Given the constraints of limited resources and the persistent rise in healthcare expenditures, precise identification and management of hospital costs are imperative.

Financial equilibrium and stability significantly impact a hospital’s primary mission of enhancing healthcare standards [7]. Efficient financial management assists departmental and hospital managers in evaluating the extent to which their units meet hospital objectives. A deep understanding of a hospital’s financial landscape empowers managers to make informed decisions and fosters economic advancement. Identifying cost-saving measures and revenue enhancement strategies is crucial for advancing hospital services both quantitatively and qualitatively. By pinpointing effective cost-cutting and revenue-boosting strategies, productivity and service provision capacity can be enhanced, enabling hospital managers to make sound, efficient, and pragmatic decisions. Consequently, this study identifies and prioritizes methods for reducing costs and increasing revenues in Iranian hospitals.

Iranian hospitals are currently grappling with significant financial misalignment issues that hinder their ability to provide quality healthcare services. These challenges arise from a complex interaction between government funding, insurance reimbursements, and out-of-pocket costs, creating a fragmented financial environment. Many hospitals face inadequate funding, which leads to resource shortages and operational inefficiencies. Additionally, misaligned financial often result in suboptimal patient care, negatively impacting outcomes. This situation underscores the urgent need for effective decision-making frameworks to address these financial complexities and improve the financial stability of hospitals in Iran.

Recognizing the importance of addressing the economic standing of hospitals, especially in developing nations where relevant studies are scarce, this research aims to identify and propose strategies to lower expenses and increase hospital revenues. Previous research has not identified and prioritized strategies for increasing revenue and reducing costs; this research gap has been addressed by our study.

Methodology

This study focused on applied research with a specific objective: to identify and prioritize strategies for reducing costs and increasing revenue in hospitals. Methodologically, it employed a quantitative approach. Initially, a systematic review was conducted to identify strategies that could decrease costs and increase revenue in hospital settings. These strategies were subsequently refined and categorized based on expert opinions.

The review included all published articles in Persian and English related to cost control strategies and hospital revenue enhancement. No sampling was utilized; all relevant articles were thoroughly reviewed. For the expert survey, individuals with relevant education and hospital management experience were considered experts. Eleven experts were selected for inclusion in the study. The initial stage involved systematically reviewing the literature to identify key methods for reducing hospital costs and increasing revenue. The search strategies used to achieve this objective are detailed in Table 1. Articles containing specified keywords in their titles and indexed in international databases such as PubMed, Google Scholar, and Scopus, or in Iranian databases such as SID and Magiran, up to November 2020, were scrutinized.

Table 1.

The search strategies of the systematic review

Database	Search strategy	Articles
Magirana	Cost, revenue, healthcare institution	134
Google Scholar	Cost, revenue, healthcare institution	446
SID	Cost, revenue, healthcare institution	65
Scopus	Income, revenue, earnings, cost, expenditure, expense, charge, strategy, plan, policy, solution, technique, method, action, hospital, healthcare, center, health, care	435
PubMed	"Income" OR "Revenue" OR "Earning" OR "Cost" OR "Expenditure" OR "Expense" OR "Charge" AND "Strategy" OR "Plan" OR Policy" OR Solution" OR "Technique" OR "Method" OR "Action" AND "Hospital" OR "Healthcare"	446
Total		1526
	After refining the search to exclude duplicate articles, articles published before 2000, and articles not in English or Persian	322

^aMagiran, or Iran's Publications Database, is a digital library that was founded in 2000 and includes digitized versions of scientific journals

The inclusion criterion required that the full texts of the articles be available in English or Persian and that they present original research findings. Articles classified as reviews, comments, or letters to the editor, or those lacking full text in English or Persian (for example, in Russian or German), were excluded. Additionally, articles had to align with the primary research goal of proposing strategies to reduce hospital costs and increase revenue. Initially, 1,526 articles were identified from various databases and citations. After filtering for originality, relevance, and publication within the last two decades, 322 articles met the specified criteria. After a thorough screening process, 27 articles were deemed eligible for inclusion because they provided specific strategies for managing hospital income and costs. These 27 articles underwent meticulous analysis to extract cost reduction and revenue-enhancing strategies. The extraction process was conducted by a healthcare management master’s student and was further evaluated by an associate professor and an assistant professor of health economics. Any discrepancies were resolved through virtual group discussions as part of the university’s ongoing education program. The study review process is illustrated in Fig. 1.

Fig. 1.

Literature review flow diagram

After reviewing the literature, the researchers identified additional effective strategies based on expert opinions to increase revenue and reduce costs in hospital settings. This process allowed the researchers to uncover previously unpublished insights and tacit knowledge on hospital economics through expert surveys. All identified strategies—gathered from both the systematic review and expert opinions—were subsequently categorized based on expert feedback and then prioritized via the TOPSIS method. The experts involved in the study were deliberately selected to meet specific criteria, and their insights were collected through a structured survey. Individuals with at least five years of experience in hospital management were considered experts in this study. Detailed information about the experts is presented in Table 2.

Table 2.

Characteristics of the participating experts

Feature		Frequency (%)
Workplace	Medical Sciences University	7 (%63.64)
	Hospital	(%36.36)4
Gender	Man	(%81.82)9
	Female	(%18.18)2
Educational attainment	Ph.D	(%45.45)5
	Master's degree	(%54.55)6
Academic discipline	Health Economics	(%27.28)3
	Different Management fields	6 (%54.54)
	Economics, Epidemiology, and Health in Disasters and Emergencies	2 (%18.18)
Membership	Faculty member	4 (%36.36)
	Nonfaculty member	7 (%63.64)
Academic ranking	Professor	1 (%9.09)
	Associate Professor	1 (%9.09)
	Assistant Professor	2 (%18.18)
	Other	7 (%63.64)

Please make below paragraphs grammatically correct and native and please use the citations that has in the base paragraphs also: Operational strategies aimed at reducing hospital costs and increasing revenue were prioritized and recommended via the TOPSIS method. Notably, TOPSIS, a multi-criteria decision-making approach, seeks to select options closest to the positive ideal solution (optimal state) and farthest from the negative ideal solution (worst state) [8]. Consequently, this method was employed to identify the most effective strategies for cost reduction and revenue enhancement in hospitals. Implementing the TOPSIS method included the following key steps:

1. Constructing the Decision Matrix and Normalizing: We created a decision matrix that organized the alternative strategies against the selected criteria. Each alternative strategy was evaluated based on each criterion, and then we normalized the decision matrix.

2. Calculating the Weighted Normalized Decision Matrix: At this stage, we combined our normalized data with the weights we assigned to generate a weighted normalized decision matrix. This step helped us capture both the performance of alternative strategies and their significance.

3. Determining the Ideal and Negative-Ideal Solutions: We identified the ideal and negative-ideal strategies. The ideal strategy represented the best possible outcome for each criterion, while the negative-ideal strategy represented the worst. By clearly defining these benchmarks, we created reference points for our strategies.

4. Calculating the Distance from Ideal Strategies: Next, we computed the distances of each strategy from both the ideal and negative-ideal strategies. This involved calculating the Euclidean distance or other suitable metrics, giving us a clear measure of how close each alternative is to both the best and worst scenarios.

5. Calculating the Relative Closeness Coefficient: We then computed the relative closeness of each alternative to the ideal strategy.

6. Ranking the Strategies: Finally, we ranked the strategies based on their relative closeness coefficients.

The research adheres to principles of professional and scientific ethics, ensuring the confidentiality of all obtained information. This study was registered in Iran’s National System of Ethics in Biological Research under the ethics code IR.BMSU.REC.1399.205. Informed consent was obtained from all participants prior to their involvement in the study. All participants were provided with detailed information regarding the study's purpose, procedures, and potential risks, and they were assured of their right to withdraw at any time without any negative consequences. Their consent was documented through signed consent forms.

Results

Table 3 provides an overview of the analyzed studies, including details such as study locations, publication years, review methods, and key findings related to the strategies. A total of 27 articles were evaluated based on specific criteria. Most of the research was conducted in Iran, accounting for approximately 60% of the total number of studies. These publications focused primarily on the last 20 years (Table 3).

Table 3.

Specifications and outcomes of studies included in the analysis of methods to decrease expenses and increase revenue in healthcare facilities

Row	Title of the article(reference)	Author (publication year)	Study location	Types of studies	Primary methods to boost revenue and cut expenses	Compact strategies
1	Implications of quality improvement module in using medical records and its effect on hospital income [9]	Hatam et al. (2008)	Iran	Quantitative (analytical and interventional)	Improving the quality of recording the treatment measures	1. Ensuring precise documentation of all treatments administered 2. Implementing a new coding system for therapeutic procedures 3. Identifying and documenting treatment measures for which no fees are charged
2	ASHP guidelines on medication cost management strategies for hospitals and health systems [10]	Hoffman et al. (2008)	America	Qualitative (Implementation)	Use of specific guidelines for medicine cost management in hospitals	1. Overseeing the prescription and provision of medications, managing the pharmaceutical supply chain from purchase to consumption, and collecting fees from patients 2. Assessing necessary preventive medicine policies and allocating special budgets for them 3. Forming a committee focused on medication economics within the hospital
3	Hospitals’ responses to administrative cost-containment policy in urban China: The case of Fujian province [11]	Jingwei and Qian (2013)	China	Qualitative (Panel data (	Administrative expenses management of hospital affairs	1. Establishing operational goals for managing costs and income in hospital departments 2. Continuously monitoring the achievement of established goals 3. Identifying and analyzing the most significant services that generate hospital income and expenditures
4	The effect of hospital ward combination on the on-going expenditure of the Tehran Bou Ali hospital [12]	Tabibi et al. (2010)	Iran	Quantitative (cross-sectional _ descriptive)	Identification and integration of departments with similar services and optimal use of departments’ capacities and potential	1. Assessing the capacity of hospital beds 2. Evaluating the capacity for diagnostic services 3. Reviewing the capacity for medications and medical equipment 4. Analyzing administrative capacity
5	A study of the status before and after outsourcing of pharmacies to the Shiraz university of medical sciences in 2014: a short report [13]	Barati et al. (2017)	Iran	Quantitative (cross-sectional and retrospective descriptive)	Outsourcing services	Outsourcing pharmacy
6	Hospital expenditures of guardian less patients in shiraz selected hospitals in second half of year 2015 [14]	Kavousi et al. (2016)	Iran	Quantitative (cross-sectional analytical description)	Management of reimbursed patient costs	1. Hospital social workers ensure the well-being of vulnerable patients, including those with unknown identities, referrals from judicial and law enforcement agencies, and individuals abandoned by their families 2. The hospital partners with judicial and support organizations
7	Laparoscopic transhiatal esophagectomy improves hospital outcomes and reduces cost: A single-institution analysis of laparoscopic-assisted and open techniques [15]	Ecker et al. (2016)	America	Quantitative (Retrospective)	Using new surgical techniques (less invasive)	Laparoscopy instead of open surgery
8	Cost savings in hospital material management: Look-back versus look-ahead inventory policies [16]	Iannone et al. (2015)	Italy	Material management in the hospital (medicines and equipment)	Hospital material management (medicines and equipment)	1. Material management 2. Outsourcing
9	The highest utilization rate of care: Individualized care plans to coordinate care, improve healthcare service utilization, and reduce costs at an academic tertiary care center [17]	Mercer et al. (2015)	America	Using a personalized treatment approach (Individualized—personalized medicine)	Use of a personalized therapeutic approach (personalized medicine)	1. Implementation of an individualized care plan 2. Development and expansion of quality improvement methods for personalized medical care
10	Estimation of cost function in Ilam hospitals from 2003 to 2012 [18]	Asgari (2014)	Iran	Quantitative (cross-sectional using the econometric model)	Identifying the main cost and revenue centers of the hospital	1. Implementing policies to reduce labor costs by changing employment conditions and enforcing minimum wage laws, including annual wage increases 2. Offering non-operative services (e.g., health and rehabilitation services)
11	Hospital resource wastage in the health transformation plan (HTP) and cost containment approaches: Diagnostic and therapeutic services tariffs [19]	Ferdosi et al. (2019)	Iran	Qualitative (content analysis)	Reforming financial structures and reducing corruption	1. Increasing the hospital’s share of specialized income 2. Equitable distribution of performance-based pay among hospital employees 3. Preparing and communicating necessary instructions to identify abuse and potential violations for referral to other centers
12	Economic and performance indicators of a big tertiary hospital: Before and after implementing the health care evolution plan, tariff change, and pay for performance instruction implementation [20]	Ebrahimipour et al. (2018)	Iran	Quantitative (descriptive _ sectional)	Effect of transformation plans on hospital performance indicators	1. Implementation of the transformation plan for hospital cost and profit 2. Implementation of a transformation plan to improve the efficiency of doctors and personnel
13	Investigating the rate and causes of hospital deductions and determining reduction strategies for Iranian hospitals [21]	Mohammadi et al. (2020)	Iran	Quantitative and qualitative (descriptive-analytic retrospectively)	Reducing hospital insurance claim rejection	1. Accurate documentation of standard services provided in medical files (without coding errors) 2. Registration of all services rendered in the hospital service system 3. Reduction of deductions per unit of income by hospital insurance representatives
14	Effect of medical equipment maintenance management system implementation on Valie–Asr hospital costs situated in Arak: 2006 [22]	Bayati (2008)	Iran	Quantitative (interventional)	Establishing a preventive maintenance management system for medical equipment	1. Effective management of medical equipment maintenance 2. Creation or development of medical engineering units in hospitals
15	Management evaluation of public hospital unit expenditures on infections using quantitative analysis methods [23]	Tsakas (2011)	Greece	Quantitative application (Data envelopment analysis)	Analysis of the expenses of different hospital departments	Estimating the optimal cost level for controlling hospital infection
16	Impact of quality management on reducing canceled elective operations: a participatory action research [24]	Mosadeghrad and Afshari (2016)	Iran	Quantitative (participatory action research)	Development of surgical services	1. Re-engineering the workflows of the surgery department 2. Continuous training courses to empower employees in the surgery department, focusing on reducing patients' length of stay 3. Planning to increase service delivery hours in the surgery department 4. Increasing the number of hospital beds and surgeries 5. Planning to identify and reduce the cancellation of surgeries and doctor appointments 6. Instructions for providing treatment consultations, preparation, and patient training in the surgery department
17	Impact of an antibiotic restriction policy on hospital expenditures and bacterial susceptibilities: A lesson from a pediatric institution in a developing country [25]	EZ-Llorens et al. (2000)	America	Quantitative (retrospective)	Protocol for medicine consumption patterns in hospital (with priority for global services)	Establishing a protocol for the correct use of antibiotics in the hospital
18	Focusing on the continuum of Care: How point-of-care testing solutions can help hospitals reduce costs and improve patient care [26]	Coyle (2009)	America	Quantitative and qualitative (experimental)	Reducing patient waiting time	Providing diagnostic services at the point of care for patients
19	The effect of quality management on the reduction of surgical department deductions at Valiasr Hospital [27]	Afshari et al. (2017)	Iran	Quantitative (participatory action research)	Reduction of deductions for surgery	1. Identifying the main causes of surgical deficits 2. Implementing actions to reduce surgical deductions based on identified causes
20	China’s new healthcare cost control policy based on the global budget: a survey of 110 healthcare clinicians in hospitals [28]	Yan et al. (2019)	China	Quantitative (questionnaire)	Policy based on cost control in the hospital (Cost control policy)	Designing a global or general payment system to maintain service quality
21	Analysis of cost-reduction techniques adopted in hospitals in and around Pune [29]	Kulkarni and Pandit (2014)	India	Quantitative (questionnaire)	Cost reduction techniques in hospitals	1. Establishing treatment guidelines in the hospital (standard operating procedures) 2. Managing energy consumption (water, electricity, gas) in the hospital 3. Implementing a performance-based payment system 4. Establishing financial audit and oversight systems 5. Utilizing electronic health records 6. Empowering employees across all departments 7. Utilizing multitasking employees (delegating multiple tasks to one person) 8. Outsourcing 9. Encouraging doctors to prescribe generic medications instead of brand-name ones 10. Managing inventory and supply chains 11. Managing contracts and insurance for timely reimbursement of hospital insurance claims
22	Failure mode and effect analysis in increasing the revenue of emergency department [30]	Rahmati et al. (2015)	Iran	Quantitative (prospective cohort)	Using the approach of failure modes and eliminating their effects in hospital departments to improve financial performance (FMEA) (Failure modes and effect analysis)	1. Accurate registration of services provided and patient consumables 2. Allocation of a dedicated code for emergency services 3. Maintaining a comprehensive and up-to-date Health Information System (HIS) in the hospital 4. Ensuring accuracy in documenting services provided (addressing deficiencies in insurance service completion, prescription errors, and health records) 5. Improving the patient discharge process to ensure timely and efficient discharges from the hospital 6. Increasing personnel share by boosting hospital income 7. Allocating a portion of the reduction in return deductions to personnel
23	A study of the revenue cycle mapping process in the ED of Kashani hospital, Isfahan, Iran, 2009 [31]	Shajaripour Mousavi (2013)	Iran	Qualitative (action research and methodology-based)	Elaboration of the hospital’s economic road map (economic transformation document)	Identifying current and desirable situations and determining road maps of emergency department income
24	Identifying the main components of the hospital cost management process [32]	Olyan Ajam et al. (2019)	Iran	Qualitative (semistructured interview)	Identifying the main components of hospital cost management	1. Establish a hospital cost management working group (Economics-Treatment Committee) to oversee hospital costs and hold regular meetings 2. Identification of cost centers 3. Preparation of operational plans for establishing a costing system
25	Conducting a systematic review of hospital downsizing methods and their global consequences and selecting suitable methods for Iran [33]	Beirami et al. (2013)	Iran	Qualitative (review)	Downsizing the hospital	1. Integration of departments and aligned hospital units 2. Outsourcing 3. Reducing the number of employees or hospital beds based on an economy-to-scale economic analysis
26	Managing hospital medicine cost during healthcare reform: Case of Shari'ati hospital [34]	Sahranavard (2020)	Iran	Combinations of algorithms	Management of hospital medicine costs	Analyzing hospital medicine costs, focusing on departments with excessive medicine consumption, particularly in the operating room
27	Rates and reasons for deductions in Tehran university hospitals [35]	Safdari et al. (2011)	Iran	Quantitative (cross-sectional descriptive)	Management of hospital deduction reduction	1. Providing training courses on the principles of accurate invoice documentation 2. Auditing medical records by the medical records department 3. Establishing an economic treatment committee to reduce deductions 4. Presenting deficit reports to the Economic-Health Committee

In Table 4, we outline the strategies for reducing costs and increasing hospital revenue, along with the frequency of their occurrence in the studies. Each strategy presented in this table was identified in at least one study or introduced by at least one expert. As shown in Table 4, the primary strategies were categorized into four main dimensions: efficiency and resource utilization, quality, resource management, and infrastructure development. Notably, factors such as service outsourcing (e.g., pharmacy services) and optimizing the use of available resources (including hospital beds, medications, equipment, paraclinical services, and administrative processes) were discussed more frequently than other strategies. Additionally, the experts contributed 41 strategies that had not been previously reported in the literature review. These suggested strategies include calculating the utilization rate of hospital equipment, surveying employees—especially clinical specialists—on income-enhancing strategies, training policymakers and senior healthcare system managers, and implementing insurance-related strategies.

Table 4.

Dimensions and strategies for increasing incomes and reducing costs in hospitals (integrating a literature review and expert opinions)

Dimension	The main strategy	Sub- strategies	Frequency	reference	experts
Efficiency and utilization of resources	Outsourcing services	Outsourcing services, such as pharmacy operations	4	[9–12]
	Integration	The integration of departments and hospital units is inadequate	2	[12, 13]
	Downsizing	Reducing the number of employees or hospital beds based on economies of scale from economic studies	1	[12]
	Reduction of hospital Insurance claim rejection	Ensuring accurate documentation of performed medical procedures and patient consumables in billing	3	[14–16]
		Improving the quality of documentation for medical procedures and patient consumables	1	[14]
		Utilizing the new coding system for treatment measures	1	[14]
		Conducting internal audits of invoices by the hospital's revenue and insurance department to minimize deductions	1	[15]
		Assigning a special code for emergency services	1	[16]
		Allocating part of the reduction in return deductions to personnel	2	[16]
		Presenting the report on deductions to the economic treatment committee	2	[17]
		Identifying the main causes of insurance deductions and implementing necessary measures to reduce them, particularly in the surgery department	2	[18]
		Providing training courses on the principles of accurate invoice documentation	1	[17]
		Conducting audits of medical records by the medical records department	1	[17]
	Optimal use of available capacity	Planning to increase the working hours of service providers, especially in the surgery department	1	[19]
		Conducting continuous training courses to empower employees, focusing on reducing the length of patient stays, particularly in the surgery department	1	[19]
		Planning to identify the causes of and reduce cancellations of surgeries and doctor appointments	1	[19]
		Planning to identify solutions to reduce the average length of stay and patient waiting times	1	[20]
		Identifying ways to optimally utilize existing resources, including hospital beds, medications, equipment, and administrative resources	4	[13]
		Multitasking employees by assigning multiple tasks to one individual	1	[11]
		Increasing the number of inpatient beds in proportion to the growth of surgeries	1	[19]
		Identifying necessary solutions for the optimal management of energy consumption (water, electricity, gas) in the hospital	1	[11]
	Other strategies based on experts’ opinion	Calculating the utilization factor of large hospital equipment			*
		Surveying employees, especially clinical specialists, regarding ways to increase revenue			*
		Training policymakers and senior managers in the health system and insurance in related fields			*
		Assigning management of clinical and paraclinical departments to doctors, employees, and retirees from those departments (insourcing)			*
		Reforming the performance-based payment system			*
		Increasing the operating room's activity percentage to its maximum capacity			*
		Identifying obstacles and assessing the efficiency of equipment and optimizing its components			*
		Determining and defining the capacity to provide health tourism services			*
Quality	Improving the quality of care	Utilizing new, less invasive surgical techniques, such as laparoscopic surgery instead of open surgery	1	[21]
		Implementing individualized care plans and a personalized medical approach in treatment	1	[22]
		Estimating the optimal cost level for hospital infection control	1	[23]
		Developing and presenting protocols for optimal medication use, especially antibiotics, in the hospital	2	[20–24]
		Establishing and applying current treatment guidelines in the hospitala	1	[25]
		Providing diagnostic services at the point of care for patients	1	[26]
	Improving the quality of processes	Reengineering work processes using new methods, including FMEAb, BPMc, and VSMd, with the aim of reducing costs and increasing the speed of patient discharge	3	[16, 17, 19]
		Preparing guidelines for providing treatment consultations and patient education in all departments, especially the surgical department	1	[19]
		Preparing and communicating necessary instructions to identify abuse and potential violations for referring patients to other centers	1	[36]
		Expediting patient discharge after surgery (e.g., cesarean sections) by organizing visit times on the day of discharge			*
		Reducing medical errors			*
		Establishing a voluntary system for reporting medical errors			*
		Reducing the rate of hospital-acquired infections			*
		Streamlining work processes for key services in the hospital			*
		Focusing on electronic processes to reduce patient and companion movement within the hospital			*
		Upgrading the hospital's credit rating to an excellent grade and increasing tariffs			*
		Providing special services for private patients (VIP services)			*
Resource management	Management of hospital financial resources	Establishing a performance-based payment system to fairly distribute payments among hospital employees	2	[11, 36]
		Planning to increase the hospital's share of special income	1	[23]
		Investigating the impact of macro policies in the health system on hospital cost and income indicators	1	[28]
		Planning for employee contributions to increase the hospital's special income	1	[16]
		Identifying the main cost and revenue centers of the hospital	2	[29, 30]
		Determining operational goals for cost and income management by hospital departments, with continuous monitoring of progress	1	[29]
		Implementing a policy to reduce the relative cost of labor by changing employment conditions and examining the substitution of labor production factors	1	[31]
	Uncompensated Care Costs	Following up on the social work processes for patients, including those with unknown identities, those referred by judicial and law enforcement agencies, and those abandoned by their families	1	[32]
		Creating or developing a social work unit	1	[32]
		Identifying and documenting medical procedures and consumables provided to patients for which no fee is charged	1	[14]
	Other strategies based on experts opinion	Changing the lighting in public spaces to low-consumption options and, where possible, implementing automatic shut-off systems			*
		Irrigating the hospital's green spaces using treated wastewater			*
		Managing human resources in relation to the standard resources available per bed			*
		Establishing operational budgeting			*
		Managing costs by identifying lost revenue and outstanding claims			*
		Pursuing the collection of deductibles from insurance sources			*
		Leveraging the capacity of health donors			*
		Valuing services and determining budget headings in the hospital budget booklet accordingly			*
		Managing medication through strategic purchasing and consumption pattern analysis, focusing on high-use items			*
		Establishing a supply chain and communication management system to ensure suppliers adhere to standard debt ranges			*
	Medicine and medical equipment management	Encouraging doctors to prescribe generic medications instead of brand-name drugs	1	[11]
		Analyzing the consumption patterns and costs of hospital medications by department, especially the operating room	2	[24, 33]
		Creating or developing a medical engineering unit in the hospital	1	[37]
		Preparing and establishing a protocol for the consumption patterns of special, expensive, and high-use medications	1	[20]
		Establishing a preventive maintenance management system for medical equipment	1	[37]
		Managing inventory and the supply chain for medications and equipment	3	[10, 11, 24]
Infrastructure development	Development of care delivery infrastructure	Utilizing electronic health records	1	[11]	*
		Ensuring the existence of a complete, comprehensive, and up-to-date Health Information System (HIS) in the hospital	1	[16]	*
		Developing nonspecific revenue streams for the hospital through the provision of non-operational services, including health services, home care, and private companion services for patients	1	[31]	*
	Development of economic infrastructure	Establishing a financial audit and review system	1	[11]	*
		Formulating operational plans to establish the costing system	1	[30]	*
		Compiling the hospital's economic roadmap (economic transformation document) with an emphasis on the main revenue centers	1	[35]	*
		Establishing a hospital cost management working group (Medical Economics Active Committee)	2	[24, 30]	*
		Managing contracts and insurance affairs to ensure prompt reimbursement of hospital insurance claims	1	[29]	*
Other	Other strategies based on experts’ opinion	Conducting cost–benefit feasibility studies to develop or offer new services at the hospital			*
		Utilizing the internet and virtual space to provide web-based services			*
		Improving information technology infrastructures			*
		Refining the framework for optimal insurance contracts in healthcare			*
		Emphasizing the reduction of supply chain costs			*
		Developing a technology cost justification plan			*
		Creating a rationale for technical-engineering programs			*
		Developing a human resources rationale plan for recruitment			*
		Financing human resources from a centralized budget line			*
		Emphasizing resource attraction and stakeholder communication to leverage capital equipment with public funds			*
		Reducing the costs of supporting departments like LSSD by utilizing services from nearby medical centers			*
		Effectively managing costs associated with catering and patient feeding			*
		Implementing cost management strategies for upstream stakeholders while preventing resource allocation issues			*
		Identifying and documenting actions that have not been recorded			*
		Empowering administrative staff to enhance their capabilities and effectiveness			*

^astandard operating procedures

^bFailure mode and effects analysis

^cBusiness process management

^dValue-stream mapping

The essential criteria for prioritizing solutions, as identified by the experts, include applicability, cost-effectiveness, efficiency, beneficiary support, maintenance and enhancement of service quality, and alignment with hospital goals and missions. During the survey phase, the experts were asked to rate their level of agreement with these criteria using a Likert scale ranging from 1 to 5. Notably, all criteria for prioritizing solutions received an average score of over 80% (equivalent to more than 4 points). The survey results, including the average, standard deviation, and percentage of the total score, are provided in Table 5.

Table 5.

Prioritization criteria for solutions

Row	Proposed criteria for prioritizing solutions	mean score	± SD	Full score percentage
1	Practicability	4.9	0.26	98.57
2	Cost-effectiveness	4.9	0.41	98.00
3	early return	4.1	0.80	81.43
4	Stakeholder support (no conflicts of interest)	4.3	0.56	85.00
5	Maintaining and Improving service quality	4.7	0.52	93.57
6	Alignment with the hospital's missions and objectives	4.3	0.62	85.00

The proposed solutions were ranked based on the criteria specified in Table 5. The results of prioritizing the main solutions using the TOPSIS technique are shown in Table 6. Improving the quality of care, improving the quality of processes, and developing care delivery infrastructure were the top priorities, with scores of 0.9030, 0.7926, and 0.7910, respectively. Downsizing, outsourcing services, and integration had the lowest priorities, with scores of 0.4105, 0.2747, and 0.0690, respectively.

Table 6.

Ranking results of the main solutions

Priority	The primary resolution	CLIa directory
1	Improving the quality of care	0.9030
2	Improving the quality of processes	0.7926
3	Development of care delivery infrastructure	0.7910
4	Reduction of hospital Insurance claim rejection	0.7724
5	Medicine and medical equipment management	0.7418
6	Management of hospital financial resources	0.7146
7	Optimal use of available capacity	0.6678
8	Uncompensated care costs	0.6126
9	Development of economic infrastructure	0.5997
10	Downsizing	0.4105
11	Outsourcing services	0.2747
12	Integration	0.0690

^aCloseness to the ideal solution

The results of prioritizing subsolutions via the TOPSIS method are presented in Table 7. These subsolutions follow a sequence related to maintaining a comprehensive and up-to-date hospital information system (HIS), identifying causes to minimize surgery and doctor appointment cancellations, and devising solutions to reduce hospital infection rates. Their respective scores were 0.7926, 0.7919, and 0.7854, indicating their top priority.

Table 7.

Subsolution ranking results

Priority	Subsolution	Command Line Interface index
1	The existence of a complete, comprehensive, and up-to-date Health Information System (HIS) in the hospital	0.7926
2	Planning to identify the causes of and reduce the cancellation rates for surgeries and doctor appointments	0.7919
3	Reducing the rate of hospital-acquired infections	0.7854
4	Identifying the main causes of insurance deductions and implementing necessary measures to reduce them, especially in the surgery department	0.7807
5	Utilizing new, less invasive surgical techniques, such as laparoscopic surgery instead of open surgery	0.7740
6	The use of electronic health records	0.7729
7	Managing human resources in relation to the standard resources available per bed	0.7699
8	Conducting continuous training courses to empower employees, focusing on reducing patient length of stay, particularly in the surgery department	0.7696
9	Preparing and establishing a protocol for the consumption patterns of special, expensive, and high-use medications	0.7687
10	Pursuing the collection of deductibles from insurance sources	0.7638
11	Managing contracts and insurance affairs to ensure prompt reimbursement of hospital insurance claims	0.7620
12	Identifying ways to optimally utilize the capacity of existing resources, including hospital beds, medications, equipment, and administrative resources	0.7616
13	Developing and presenting protocols for the optimal use of medications, especially antibiotics, in the hospital	0.7612
14	Managing inventory and the supply chain for medications and equipment	0.7578
15	Reducing medical errors	0.7577
16	Providing training courses on the principles of accurate invoice documentation	0.7575
17	Identifying the main cost and revenue centers of the hospital	0.7551
18	Identifying and documenting medical procedures and consumables provided to patients for which no fee is charged	0.7519
19	Conducting internal audits of invoices by the hospital's revenue and insurance department to minimize deductions	0.7466
20	Improving the quality of documentation for medical procedures and patient consumables	0.7428
21	Establishing a preventive maintenance management system for medical equipment	0.7385
22	Implementing and applying current treatment guidelines in the hospital	0.7369
23	Presenting a report on deductions to the economic treatment committee	0.7358
24	Surveying employees, especially clinical specialists, about ways to increase revenue	0.7343
25	Determining operational goals for cost and income management by hospital departments, with continuous monitoring of progress	0.7339
26	Establishing a financial audit and review system	0.7312
27	Managing costs by identifying lost revenue and outstanding claims	0.7298
28	Planning to identify solutions to reduce the average length of stay and patient waiting times	0.7238
29	Establishing a performance-based payment system to fairly distribute payments among hospital staff	0.7211
30	Forming a hospital cost management working group (Medical Economics Active Committee)	0.7197
31	Identifying necessary solutions for the optimal management of energy consumption (water, electricity, gas) in the hospital	0.7190
32	Utilizing the new coding system for treatment measures	0.7121
33	Conducting audits of medical records by the medical records department	0.7108
34	Estimating the optimal cost level for hospital infection control	0.7053
35	Planning to increase the hospital's share of special income	0.7038
36	Ensuring accurate documentation of performed medical procedures and patient consumables in bills	0.7033
37	Creating or developing a medical engineering unit in the hospital	0.7022
38	Utilizing the internet and virtual space to offer web-based services	0.6896
39	Analyzing the consumption patterns and costs of hospital medications by department, especially the operating room	0.6784
40	Outsourcing services, such as pharmacy operations	0.6783
41	Reengineering work processes using new methods, including FMEA, BPM, and VSM, with the aim of reducing costs and increasing the speed of patient discharge	0.6763
42	Calculating the utilization factor of large hospital equipment	0.6724
43	Assigning a special code for emergency services	0.6690
44	Developing nonspecific revenue streams for the hospital through the provision of non-operational services, including health services, home care, and private companion services for patients	0.6642
45	Providing diagnostic services at the point of care for patients	0.6621
46	Planning for employee contributions to increase the hospital's special income	0.6613
47	Increasing the operating room's activity percentage to its maximum capacity	0.6599
48	Conducting cost–benefit feasibility studies to develop or offer new services at the hospital	0.6469
49	Offering special services for private patients (VIP services)	0.6414
50	Upgrading the hospital's credit rating to an excellent grade and increasing tariffs	0.6373
51	Preparing guidelines for providing treatment consultations and patient education in all departments, especially the surgical department	0.6347
52	Increasing the number of inpatient beds in proportion to the growth of surgeries	0.6324
53	Preparing and communicating necessary instructions to identify abuse and potential violations for referral of patients to other centers	0.6283
54	Following up on the social work processes for patients, including those with unknown identities, those referred by judicial and law enforcement agencies, and those abandoned by their families	0.6219
55	Establishing operational budgeting	0.6117
56	Investigating the impact of macro policies in the health system on hospital cost and income indicators	0.6107
57	Establishing a voluntary system for reporting medical errors	0.6085
58	Allocating part of the reduction in return deductions to personnel	0.5890
59	Creating or developing a social work unit	0.5848
60	Encouraging doctors to prescribe generic medications instead of brand-name drugs	0.5793
61	Determining and defining the capacity to provide health tourism services	0.5738
62	Compiling the hospital's economic roadmap (economic transformation document) with an emphasis on the main revenue centers	0.5702
63	Formulating operational plans to establish the costing system	0.5671
64	Leveraging the capacity of health donors	0.5561
65	Emphasizing resource attraction and stakeholder communication to enhance capital equipment with public funding	0.5560
66	Planning to increase the working hours of service providers, especially in the surgery department	0.5414
67	Implementing individualized care plans and a personalized medical approach in treatment	0.4919
68	Noting that the integration of departments and hospital units is inadequate	0.3282
69	Implementing a policy to reduce the relative cost of labor by changing employment conditions and examining the substitution of labor production factors	0.3153
70	Reducing the number of employees or hospital beds based on economies of scale from economic studies	0.2843
71	Multitasking employees by assigning multiple tasks to one individual	0.0039

Discussion

In this study, the primary subsolution identified was the need for a comprehensive, up-to-date hospital information system (HIS). This solution was deemed the highest priority. Similarly, Rahmati et al. [30] noted that implementing a HIS could increase hospital revenue by improving decision-making processes. Rahimi et al. [36] demonstrated that nurses have favorable perceptions of using the HIS to enhance clinical documentation. However, Hassankhani et al. [37] highlighted drawbacks such as redundancy, increased distance from the patient’s bedside, and system-related issues reported by nurses using the HIS. Therefore, it is advisable to strengthen the enabling elements, address hardware and software deficiencies, and consider employing portable and handheld devices linked to the HIS.

The solution focused on identifying causes and reducing surgery and doctor appointment cancellations was of secondary importance. Mosadeghrad and Afshari [38] emphasized the use of the HIS to develop protocols for presurgery patient preparation, ensure timely doctor visits (surgeons, anesthetists, and internal specialists), establish treatment consultation protocols, and provide patient education to minimize surgery cancellations. Tabatabaee et al. [39] identified key factors influencing surgical cancellations, including issues within the operating room, anesthesia, nonclinical patient problems, surgeon-related factors, and clinical issues. Ramezankhani et al. [40] identified common reasons for surgery cancellations, such as insufficient surgery time, patient clinical issues, incomplete test results, inadequate blood supply, and a lack of necessary surgical equipment and medications. Additionally, Mosadeghrad and Afshari [24] highlighted patient non-referral, lack of ICU beds, and diagnoses made during consultations as primary reasons for surgery cancellations. Bastani et al. [41] reported that prior to the health transformation plan, surgeon-related factors were the main cause of surgery cancellations, whereas post-implementation of the plan, organizational and management issues, particularly a lack of operating room time, became the predominant reasons.

In the research conducted by Hashemi-Dehaghi et al. [42], solutions such as "interdepartmental coordination," "enhancing preoperative consultation processes," "staff training," "supply and equipment provision planning," and "patient education" were ranked from first to fifth to decrease surgery cancellations.

The subsolution of "identifying solutions to reduce hospital infection rates" held the third priority and was integrated into the expert-driven subsolutions. By lowering hospital infection rates, this approach results in a reduced patient length of stay, subsequently increasing hospital revenue. Ghasemi et al. [43] emphasized the importance of staff knowledge regarding hospital infection control principles and their role in preventing infections. To combat hospital infections, nurses should engage in activities such as participating in infection control committees, enforcing rigorous monitoring systems, practicing proper hand hygiene, isolating long-stay patients with dedicated nursing care, adhering to standards before and after treatment procedures, implementing regular cultures, restricting visits, promptly addressing infection outbreaks, and following decontamination guidelines. Emphasizing the importance of hand hygiene, infection control compliance, and staff awareness is crucial in preventing hospital infections. Mosadeghrad et al. [44] highlighted that care departments, particularly special, internal, and hematology units, have the highest rates of hospital infections, with suction being a key risk factor.

The fourth-ranked solution among the proposed solutions involves identifying the primary causes of insurance claim rejection and implementing necessary measures to mitigate them, particularly within the surgery department. Mosadeghrad and Afshari [24] highlighted this solution. Safdari et al. [35] emphasized that a significant portion of deductions results from medical staff’s lack of familiarity with insurance organizations’ documentation requirements. To address these deficits, a comprehensive approach is essential, including educating medical personnel on documentation principles, ensuring proper case control implementation in the medical records unit, and establishing a university committee to consistently execute relevant initiatives.

Aryankhesal et al. [45] emphasized that calculation errors, lack of hospital supervision, and issues related to document dates and times are key factors leading to deductions, necessitating adjustments in planning. They stressed the importance of establishing a theoretically efficient Diagnosis-Related Group (DRG) reimbursement system, along with training and supervision, as crucial solutions for reducing deductions. Similarly, Karimi et al. [46] noted that most outpatient deductions stem directly from organizational errors and are often linked to mistakes made by hospital staff. They underscored the need to educate physicians, nurses, and all individuals involved in patient billing processes. Conversely, the primary underlying issue in hospitalized patients was excessive requests, which, despite not being viewed as resource waste, can lead to disputes between hospitals and insurance entities.

The fifth priority involves the utilization of new, less invasive surgical techniques, such as laparoscopic surgery, instead of open surgery. Research by Ecker et al. [15] highlights that opting for less invasive procedures over open surgery can result in reduced hospital stays, lower infection risks, and fewer postoperative complications, potentially leading to increased revenue. Atluri et al. [47] noted that, compared with the traditional sternotomy approach, minimally invasive mitral valve surgery can be conducted at a lower overall cost and with shorter hospitalization periods. Although minimally invasive mitral valve surgery may incur higher expenses, these costs are somewhat offset by the brief stay in the intensive care unit post-operation.

The subsolution of “using electronic health records” ranks sixth in priority, as outlined in the study by Kulkarni and Pandit [29], which aims to reduce hospital costs through the utilization of electronic health records (EHR). Jebraeily et al. [48] highlighted the inadequate preparation of human resources for EHR implementation. Identifying factors that enhance readiness and offering necessary training to improve computer skills and awareness are crucial. Salmani Mojaveri et al. [49] proposed a model for the hospital version of electronic health records to optimize medical file registration systems. This model aims to expedite the electronic file creation process in the health system, particularly in high-volume public hospitals. It facilitates intraorganizational and extraorganizational interaction, enabling agile responses within set timelines. Moreover, the model’s application can reduce hospital criticisms and complaints while aligning medicine usage with community needs and individual data. Despite these obstacles, overcoming them necessitates increased management efforts and broader government support. These endeavors are pivotal in fostering an information technology culture among hospital staff, patients, and health system clients.

Managing human resources based on standard ratios

Managing human resources based on the standard ratio of personnel to hospital beds is our seventh priority. This approach, integrated into subsolutions through expert theories, enhances service quality, thereby improving overall service quality and increasing hospital revenue. Research by Sadeghifar et al. [50] emphasized that effective human resource management and planning, addressing staff shortages, and aligning hospital staffing with standard levels enhance operational efficiency and effectiveness. Yazdanpanah et al. [51] suggested that modern human resource estimation systems, such as WISN, should replace traditional methods. It is also recommended that the time and activity of hospital units be measured to determine the ratio of personnel to beds for each hospital.

Continuous training courses for employee empowerment

Our eighth priority involves providing continuous training courses to empower employees, with a focus on reducing the length of patient stays, particularly in the surgery department. Mosadeghrad and Afshari [24] highlighted the correlation between offering training courses and increasing hospital revenue.

Protocol for medicine consumption models

The ninth priority solution focuses on the preparation and establishment of a protocol for medicine consumption models, specifically for special, expensive, and high-use medicines. Saez-Llorens et al. [25] discuss how this approach can lead to reduced consumption of stronger and more expensive antibiotics, ultimately lowering hospital costs. Research by Mahdavinoor and Donkob [52] highlights factors contributing to reduced hospital expenses, including a lack of supervision in diagnosis and prescription systems, the absence of a comprehensive patient referral system, and irrational prescription practices.

Macintyre et al. [53] stated that reducing the inappropriate use of high-volume medicines, such as antibiotics, can be more effective in optimizing the medicine budget of medical centers than efforts that focus solely on reducing the use of expensive medicines. They also noted that systematic measurement of medicine consumption patterns is a key element of medicine cost control strategies. Additionally, Chapuis et al. [54] stated in their study that by implementing the ADS plan for the use of cytotoxic medicines, we can reduce the number of deaths and observe an increase in working time among nurses and pharmacists; as a result, we can see a decrease in medicine-related costs.

The strategy of "pursuing the periodic reduction of insurance deductible collections" has the tenth priority among 71 subsolutions. This solution was added to the subsolutions based on the opinions of experts and leads to an increase in hospital income.

Reducing insurance deductible collections

As our tenth priority among the 71 subsolutions, we recommend pursuing periodic reductions in insurance deductible collections. This diligent follow-up approach contributes to increased hospital revenue.

Our study identifies key strategies for improving the economic performance of hospitals, including updating information systems, reducing surgery cancellations, minimizing hospital-acquired infections, and adopting minimally invasive surgical procedures. The novelty of this research lies in its demonstration of the strong link between these operational improvements and financial outcomes, underscoring their importance in cost reduction initiatives. However, the study has limitations, such as the relatively small number of experts consulted, and we reviewed only articles published from 2000 onwards. Additionally, the strategies presented may be specific to Iran and may not be generalizable to other developing countries. Future research should explore the scalability of these strategies in various healthcare settings and investigate the long-term sustainability of these interventions. It is also recommended to include a wider range of experts and hospitals in future studies. In conclusion, prioritizing quality enhancements is essential not only for improving patient outcomes but also for ensuring the long-term economic health of hospitals, providing valuable insights for both theory and practice.

Conclusion

This research sheds light on cost reduction strategies in hospitals by pinpointing 12 key strategies and 71 sub-strategies specifically designed for hospitals in Iran. It underscores the vital importance of enhancing the quality of care and the role of a comprehensive Health Information System (HIS) in achieving financial stability. One significant takeaway is the necessity of tackling operational inefficiencies, such as reducing the number of cancelled surgeries and appointment visits. However, we acknowledge some limitations, including that our findings stem from a single country's healthcare system, which may not be applicable everywhere, and that self-reported data can introduce some bias. Looking ahead, it would be beneficial for future research to examine how these strategies affect financial performance and patient care over time in various healthcare environments. Conducting comparative studies in different countries could provide valuable insights, and understanding the implementation challenges from the viewpoints of clinical staff and patients will be essential. Additionally, exploring how to sustain these strategies in a constantly changing healthcare landscape can lead to even greater improvements.

Authors’ contributions

Mohammad Meskarpour-Amiri and Naeim Shokri authored the main manuscript text, while Saedeh Aliyari prepared the tables. Mohammadkarim Bahadori and Sayyed-Morteza Hosseini-Shokouh created the abstract. All authors reviewed the manuscript.

Funding

This study conducted with no financial support.

Data availability

The datasets generated and/or analyzed during the current study are available from the corresponding author upon reasonable request.

Declarations

Ethics approval and consent to participate

The ethics committee of the Baqiyatallah University of Medical Sciences (BUMS) approved this study (Approval ID: IR.BMSU.REC.1399.205). Informed consent was obtained from all participants prior to their involvement in the study. All participants were provided with detailed information regarding the study's purpose, procedures, and potential risks, and they were assured of their right to withdraw at any time without any negative consequences. Their consent was documented through signed consent forms. All experiments were performed in accordance with relevant guidelines and regulations.

Consent for publication

Not applicable.

Competing interests

The authors declare no competing interests.