Cost measure. Many studies chose total hospital expenditures to reflect costs of services; however, with this cost measure, patient-specific resource use is not reflected in detail. Two studies determined costs per patient by transforming hospital charges into patient costs using a cost-to-charge ratio. This method assumed that hospital charges would exceed current expenses because of the need for replacement of equipment and facilities over and above these expenses and because some payers would not pay full charges (they take a discount). The charges are converted to costs by using a constant ratio of cost-to-charge, which is estimated by dividing total hospital operation expenditure with hospital revenue. The main concern of using this method was that a constant cost-to-charge ratio was an inappropriate assumption. Drug A costs $10 to produce and can be sold for $11 while drug B costs $10 to produce and can be sold for $10.50. If a cost to charge ratio is 10%, it could reflect the actual costs of drug A but would fail to show the actual costs of drug B.