Some of the large sized companies have taken parts in a hospital business with a view or justification to improve medical care regadless of the disadvantageous fee-for-service medical insurance reimbursement system controlled by authorities related. This gradually brought about the financial difficulties to university hospitals as well as general hospitals that were less competitive. In this circumstance the hospital administrators are called for preparing and implementing proper financial strategies by analyzing external circumstances and internal abilities of their hospitals. In this aspect, an effective cost-analysis system in the hospital has been needed for years. K-University hospital developed the practical cost-analysis system and applied it to the hospital management. The effects of cost analysis system are as belows: first, the trend of the monthly revenue per medical specialist from March to July in 1996 showed increasing pattern which is different from that in past years. second, it turned out that the department of functional laboratory in relation to medical treatment enlarged the medical revenue very sharply. third, the intensive care units were being operated at the state of deficit, while other general wards were lucrative.