Financial transparency and operational efficiency are no longer optional—they are essential for sustainability. For healthcare providers, understanding the true cost of delivering care is a critical step toward improving services, managing resources effectively, and meeting regulatory requirements. This is where the Patient Level Information and Costing System (PLICS) comes in.

PLICS is more than just a finance tool; it’s a strategic framework that links clinical activity to actual costs, enabling providers to see precisely where their resources are going and how they can optimise them.

What is PLICS?

The Patient Level Information and Costing System (PLICS) is a costing methodology that calculates the actual cost of healthcare services for each patient, rather than relying on average or aggregated figures.

It integrates patient-level activity data (such as treatments, procedures, diagnostics, and length of stay) with financial data (including staff time, equipment use, and consumables) to produce a clear, accurate cost profile for each patient’s care journey.

How PLICS Works

At its core, PLICS combines two key data streams:

1. Patient Care Activity Data
   • Collected from electronic health records (EHRs), clinical notes, procedure logs, and other operational systems.
   • Includes details like type of treatment, procedures performed, medications administered, and diagnostics undertaken.
2. Finance & Resource Data
   • Sourced from hospital finance systems and procurement records.
   • Includes staff salaries, medical equipment depreciation, consumables costs, facility overheads, and other expenditures.

These datasets are brought together in the PLICS system, where costs are allocated directly to each patient’s activity record. The output is a patient-level cost report showing the exact financial footprint of each care episode.

The Link Between Clinical Costing Standards and PLICS

The NHS Clinical Costing Standards provide the national rules and guidance on how costs should be collected, allocated, and reported. They define:

• Which costs to include (direct and indirect).
• How to apportion shared resources like staff time and equipment usage.
• Standard definitions for activity units, such as theatre hours or bed days.

PLICS applies these standards in practice. Without them, each trust might use its own cost definitions, making comparisons unreliable. By following Clinical Costing Standards, PLICS outputs are accurate, consistent, and comparable across the NHS—allowing for meaningful benchmarking, fair funding decisions, and compliance with the National Cost Collection.

💡 Think of Clinical Costing Standards as the recipe and PLICS as the kitchen—one tells you how to prepare the dish, and the other is where it’s actually made.

Why PLICS Matters

By providing a detailed breakdown of costs for every patient, PLICS helps healthcare leaders:

• Improve Cost Accuracy – Moves away from averages to true patient-level cost data.
• Benchmark Performance – Identify cost variations across departments, sites, or care pathways.
• Support NHS National Cost Collection – Ensures compliance with mandatory reporting requirements.
• Enhance Service Planning – Identify areas of inefficiency or high-cost activity to target for improvement.
• Enable Value-Based Care – Link costs with patient outcomes for better care and resource decisions.

Common Applications of PLICS

Healthcare organisations use PLICS data for:

• Budgeting and Forecasting – Allocate funds based on actual cost data.
• Service Redesign – Analyse cost patterns to improve efficiency.
• Contract Negotiations – Support discussions with commissioners using evidence-based cost data.
• Clinical Engagement – Give clinicians insights into the financial impact of care decisions.

Challenges in Implementing PLICS

While PLICS offers significant benefits, successful implementation requires:

• Data Quality and Integration – Ensuring clinical and finance systems are accurate and compatible.
• Staff Training – Building understanding among finance teams, clinicians, and management.
• Change Management – Embedding PLICS into regular operational and strategic decision-making.

A Visual Overview of PLICS Workflow

PLICS integrates patient care activity data with finance and resource data to generate patient-level costs for informed decision-making.

The Future of Healthcare Costing

As healthcare moves toward more outcome-based and personalised care models, systems like PLICS will play an increasingly vital role. By aligning financial insights with patient journeys, providers can make data-driven decisions that improve both clinical outcomes and cost efficiency.

In a time of budget constraints and growing patient demand, understanding the cost of every care episode is no longer a back-office function—it’s a frontline necessity. PLICS empowers healthcare leaders to turn raw data into actionable insights, ensuring that every decision is grounded in both clinical and financial realities.