This chapter describes how the costing for contracting methodology has been developed and applied in a busy University Hospitals Trust and how practical approaches to resource management using casemix have been put into place. Southampton University Hospitals Trust has a strong clinical directorate structure covering groups of specialties who are responsible for managing a devolved budget and subsequently for securing income from contracts. Expenditure within the Trust is made up of variable activity related costs, semi-fixed and fixed costs including capital charges. A methodology was developed across Southampton University Hospitals Trust to produce a set of prices based on HRGs that could be used for setting casemix-sensitive contracts which would ensure that all costs could be recouped. Key HRGs which represented over 70% of the costs incurred and/or the bed-days occupied within a directorate were identified. Project teams proceeded to draw up care profiles which identified the level of resources being typically consumed for key procedures within each HRGs.