Objective: To explore strategic cost management of public hospital. Methods: Established strategic cost management system of public hospital using BSC, combining internal and external factors. Results: Combined cost management and strategic development, focused on costs rather than stick to the cost, created competitive advantage from financial, patient, internal processes and learning & growth in four dimensions, maintaining and continuously improving the core competitiveness.. Conclusion: Public hospitals should do strategic cost management according to their actual situation, balancing relevant factors and achieving healthy and sustainable development.