Which of the following is an indirect cost example?

• A. Lost productivity due to illness.
• B. Hospital stays and medications.
• C. Medical tests.
• D. Hospital infrastructure.

Answer: (A)

Indirect costs are the economic losses tied to illness that aren’t the price of a medical service itself. Lost productivity due to illness fits this because it measures how illness reduces a person’s ability to work and earn income, which is an economic consequence rather than a direct medical charge.

Direct medical costs are the actual services and items used to treat someone, such as hospital stays, medications, and medical tests. Hospital infrastructure is an overhead, fixed cost necessary to run the facility, not a patient-specific cost of care, so it’s not considered an indirect cost in this context.