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Yalamanchi P, Marentette LJ, Fendrick AM, Chinn SB, Prince MEP, Rosko AJ, Shuman AG, Spector ME, Stucken CL, Malloy KM, Casper KA. Application of Time-Driven Activity-Based Costing for Head and Neck Microvascular Free Flap Reconstruction. Otolaryngol Head Neck Surg 2024; 171:73-80. [PMID: 38643408 DOI: 10.1002/ohn.739] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 07/31/2022] [Revised: 01/22/2024] [Accepted: 02/05/2024] [Indexed: 04/22/2024]
Abstract
OBJECTIVE Traditional hospital accounting fails to provide an accurate cost of complex surgical care. Here we describe the application of time-driven activity-based costing (TDABC) to characterize costs of head and neck oncologic procedures involving free tissue transfer. STUDY DESIGN Retrospective cohort study. SETTING Single tertiary academic medical center. METHODS An analysis of head and neck oncologic procedures involving microvascular free flap reconstruction from 2018 to 2020 (n = 485) was performed using TDABC methodology to measure cost across operative case and postoperative admission, using quantity of time and cost per unit of each resource to characterize resource utilization. Univariate and generalized linear mixed models were used to examine associations between patient and hospital characteristics and cost of care delivery. RESULTS The total cost of care delivery was $41,905.77 ± 21,870.27 with operating room (OR) supplies accounting for only 10% of the total cost. Multivariable analyses identified significant cost drivers including operative time, postoperative length of stay, number of return trips to the OR, postoperative complication, number of free flaps performed, and patient transfer from another hospital or via emergency department admission (P < .05). CONCLUSION Operative time and postoperative length of stay, but not operative supplies, were primary drivers of cost of care for head and neck oncology cases involving free tissue transfer. TDABC offers granular cost characterization to inform cost optimization through unused capacity identification and postoperative admission efficiencies.
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Affiliation(s)
- Pratyusha Yalamanchi
- Department of Otolaryngology-Head and Neck Surgery, Vanderbilt University Medical Center, Nashville, Tennessee, USA
| | - Lawrence J Marentette
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - A Mark Fendrick
- Department of Internal Medicine, University of Michigan, Ann Arbor, Michigan, USA
- Department of Health Management and Policy, University of Michigan, Ann Arbor, Michigan, USA
| | - Steven B Chinn
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Mark E P Prince
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Andrew J Rosko
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Andrew G Shuman
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Matthew E Spector
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Chaz L Stucken
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Kelly M Malloy
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
| | - Keith A Casper
- Department of Otolaryngology-Head and Neck Surgery, University of Michigan Medical School, Ann Arbor, Michigan, USA
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Kenny C, Chavrimootoo S, Priyadarshini A. Cost of treating rheumatoid arthritis in the primary care public health system in Ireland: A time-driven activity-based cost analysis. EXPLORATORY RESEARCH IN CLINICAL AND SOCIAL PHARMACY 2024; 14:100439. [PMID: 38655193 PMCID: PMC11035073 DOI: 10.1016/j.rcsop.2024.100439] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 01/30/2023] [Revised: 03/11/2024] [Accepted: 04/03/2024] [Indexed: 04/26/2024] Open
Abstract
Background Chronic diseases are at epidemic proportions and continuing to increase in both incidence and prevalence globally. Therefore, there is a growing need to assess and improve on the value currently provided within chronic care pathways. Examining the costs associated with care pathways is a critical part of assessing this value in order to better understand and introduce potential cost-saving interventions. Objectives Examining one such chronic disease, Rheumatoid Arthritis (RA), this study aimed to assess the cost associated with RA in primary care within the Health Service Executive (HSE) in Ireland. Methods Following mapping of the care pathway, patient vignettes based on exemplar RA patient types were used to conduct semi-structed interviews with every member (N = 21) of the primary care RA pathway. Time-Driven Activity-Based Costing (TDABC) was then used to calculate the overall cost of each patient (vignette) type. Results RA is an expensive condition regardless of disease stage. However, newly diagnosed patients as well as those with advanced disease in need of surgical interventions demonstrated the highest costs in terms of primary care personnel use. Additionally, patients prescribed Biological Disease-Modifying Anti-Rheumatic Drugs (bDMARDs) cost significantly more than those on Conventional Synthetic Disease-Modifying Anti-Rheumatic Drugs (csDMARDs) regardless of disease stage or personnel resource use. Conclusion RA and a subset of RA patients that exert the highest healthcare costs are growing in prevalence. Therefore, this study contributes by assessing the costs associated with RA in HSE primary care that can facilitate better understanding the current value being provided and improve upon the current care pathway to cut future costs.
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Affiliation(s)
- Christina Kenny
- College of Business, Technological University Dublin, Aungier Street, Dublin 2, Ireland
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Enes K, Koşan L. Using time-driven activity-based costing in restaurant business: Levelled application of a case study. Heliyon 2024; 10:e25157. [PMID: 38370254 PMCID: PMC10867309 DOI: 10.1016/j.heliyon.2024.e25157] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 08/31/2023] [Revised: 01/18/2024] [Accepted: 01/22/2024] [Indexed: 02/20/2024] Open
Abstract
For better profitability, all restaurants should target maximizing workers' productivity, especially in fine dining establishments. In this context, cost knowledge is fundamental information needed for managerial decision-making, such as capacity, pricing, product mix, and profitability analyses. Calculating food costs in recipes can be done easily if only material costs are considered. However, it is quite difficult to associate labor costs and general overhead costs with food production and incorporate them into the calculations. The Time-Driven Activity-Based Costing (TDABC) system is an effective way to calculate the cost of labor based on the time spent by workers during food production. This research applies the TDABC system in a case study conducted in a 5-star luxury hotel's fine dining restaurant to investigate labor cost. Furthermore, it suggests a different approach by enhancing the existing TDABC system formula, which considers workers with different skills and their associated costs (Leveled TDABC). The findings of this research demonstrate that this approach provides more efficient results and allows for a more detailed and effective understanding of idle capacities and labor productivity.
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Affiliation(s)
- Kemal Enes
- Tarsus University, Civil Airport Transport Management, Turkey & University of Leeds, Center for Decision Research, UK
| | - Levent Koşan
- Univesity of Mersin, Faculty of Tourism, Tourism Management Department, Mersin, Turkey
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Morrow C, Woodbury M, Simpson AN, Almallouhi E, Simpson KN. Determining the Marginal Cost Differences of a Telehealth Versus an In-person Occupational Therapy Evaluation Session for Stroke Survivors Using Time-driven Activity-based Costing. Arch Phys Med Rehabil 2023; 104:547-553. [PMID: 36513124 PMCID: PMC10967225 DOI: 10.1016/j.apmr.2022.11.006] [Citation(s) in RCA: 1] [Impact Index Per Article: 1.0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 03/15/2022] [Revised: 10/31/2022] [Accepted: 11/09/2022] [Indexed: 12/14/2022]
Abstract
OBJECTIVE To estimate the marginal cost differences and care delivery process of a telerehabilitation vs outpatient session. DESIGN This study used a time-driven activity-based costing approach including (1) observation of rehabilitation sessions and creation of manual time stamps, (2) structured and recorded interviews with 2 occupational therapists familiar with outpatient therapy and 2 therapists familiar with telerehabilitation, (3) collection of standard wages for providers, and (4) the creation of an iterative flowchart of both an outpatient and telerehabilitation session care delivery process. SETTING Telerehabilitation and outpatient therapy evaluation. PARTICIPANTS Three therapists familiar with care deliver for telerehabilitation or outpatient therapy (N=3). INTERVENTIONS Not applicable. MAIN OUTCOME MEASURES Marginal cost difference between telerehabilitation and outpatient therapy evaluations. RESULTS Overall, telerehabilitation ($225.41) was more costly than outpatient therapy ($168.29) per session for a cost difference of $57.12. Primary time drivers of this finding were initial phone calls (0 minutes for OP therapists vs 35 minutes for TR) and post documentation (5 minutes for OP vs 30 minutes for TR) demands for telerehabilitation. CONCLUSIONS Telerehabilitation is an emerging platform with the potential to reduce costs, improve health care inequities, and facilitate better patient outcomes. Improvements in documentation practices, staffing, technology, and reimbursement structuring would allow for a more successful translation.
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Affiliation(s)
- Corey Morrow
- College of Health Professions, Medical University of South Carolina, Charleston, SC; Department of Occupational Therapy, Whitworth University, Spokane, WA.
| | - Michelle Woodbury
- College of Health Professions, Medical University of South Carolina, Charleston, SC
| | - Annie N Simpson
- College of Health Professions, Medical University of South Carolina, Charleston, SC
| | - Eyad Almallouhi
- College of Medicine, Medical University of South Carolina, Charleston, SC
| | - Kit N Simpson
- College of Health Professions, Medical University of South Carolina, Charleston, SC
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Dooley MJ, Simpson KN, Simpson AN, Nietert PJ, Williams JD, King K, McElligott JT. A Modification of Time-Driven Activity-Based Costing for Comparing Cost of Telehealth and In-Person Visits. Telemed J E Health 2022; 28:1525-1533. [PMID: 35263178 PMCID: PMC9587787 DOI: 10.1089/tmj.2021.0338] [Citation(s) in RCA: 7] [Impact Index Per Article: 3.5] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 06/30/2021] [Revised: 11/22/2021] [Accepted: 11/24/2021] [Indexed: 11/12/2022] Open
Abstract
Introduction: Cost studies of telehealth (TH) and virtual visits are few and report mixed results of the economic impact of virtual care and TH. Largely missing from the literature are studies that identify the cost of delivering TH versus in-person care. The objective was to demonstrate a modified time-driven activity-based costing (TDABC) approach to compare weighted labor cost of an in-person pediatric clinic sick visit before COVID-19 to the same virtual and in-person sick-visit during COVID-19. Methods: We examined visits before and during COVID-19 using: (1) recorded structured interviews with providers; (2) iterative workflow mapping; (3) electronic health records time stamps for validation; (4) standard cost weights for wages; and (5) clinic CPT billing code mix for complexity weighs. We examined the variability in estimated time using a decision tree model and Monte Carlo simulations. Results: Workflow charts were created for the clinic before COVID-19 and during COVID-19. Using TDABC and simulations for varying time, the weighted cost of clinic labor for sick visit before COVID-19 was $54.47 versus $51.55 during COVID-19. Discussion: The estimated mean labor cost for care during the pandemic has not changed from the pre-COVID period; however, this lack of a difference is largely because of the increased use of TH. Conclusions: Our TDABC approach is feasible to use under virtual working conditions; requires minimal provider time for execution; and generates detailed cost estimates that have "face validity" with providers and are relevant for economic evaluation.
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Affiliation(s)
- Mary J. Dooley
- Department of Healthcare Leadership and Management, College of Health Professions, Medical University of South Carolina, Charleston, South Carolina, USA
| | - Kit N. Simpson
- Department of Healthcare Leadership and Management, College of Health Professions, Medical University of South Carolina, Charleston, South Carolina, USA
- Department of Public Health Sciences, College of Medicine, Medical University of South Carolina, Charleston, South Carolina, USA
| | - Annie N. Simpson
- Department of Healthcare Leadership and Management, College of Health Professions, Medical University of South Carolina, Charleston, South Carolina, USA
- Department of Health Science and Research, College of Health Professions, Medical University of South Carolina, Charleston, South Carolina, USA
| | - Paul J. Nietert
- Department of Public Health Sciences, College of Medicine, Medical University of South Carolina, Charleston, South Carolina, USA
| | - J. Duncan Williams
- Department of Healthcare Leadership and Management, College of Health Professions, Medical University of South Carolina, Charleston, South Carolina, USA
| | - Kathryn King
- Center for Telehealth, Medical University of South Carolina, Charleston, South Carolina, USA
| | - James T. McElligott
- Center for Telehealth, Medical University of South Carolina, Charleston, South Carolina, USA
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Deutsch SA, Zomorrodi A, Zent J, Kirk A, O'Brien P, Loiselle C, De Jong A. Hospital Costs, Revenue, and Abuse Detection Associated With Occult Injury Screening. Acad Pediatr 2022; 22:989-996. [PMID: 35367403 DOI: 10.1016/j.acap.2022.03.017] [Citation(s) in RCA: 2] [Impact Index Per Article: 1.0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 10/07/2021] [Revised: 03/24/2022] [Accepted: 03/28/2022] [Indexed: 11/28/2022]
Abstract
OBJECTIVE Performance of occult injury screening including skeletal surveys and neuroimaging is recommended to comprehensively evaluate suspected child physical abuse. Screening performance-associated hospital costs and net revenue for care of index abuse victims and siblings/household contacts are largely unknown. We aimed to describe 1) costs and net revenue associated with radiologic occult injury screening at an urban level 1 pediatric trauma center, 2) areas of perceived high resource intensity (time spent in abuse victim-related care), and 3) detection yield among children undergoing occult injury screening and physical assessment. METHODS Using time-driven activity-based cost analysis, hospital, per physician, staff, and radiology costs associated with occult injury screening performance were mapped for 199 children <2 years old. Hospital costs and resource times were approximated and compared with net revenue for each healthcare encounter. Abstracted variables included index/sibling status, injury classification, and length of stay (LOS). RESULTS Of 199 children with variable LOS (0-45 days), total hospital costs (facility, physician, staff, radiology) ranged $297.83 to $81,474; net revenue was positive. Total ED time per abuse case varied 32 to 1823 minutes; social work (SW) time ranged 44 to 720 minutes; prolonged ED/SW time represented resource-intense areas. Of siblings, 27% were diagnosed with unanticipated findings based on occult injury screening and examination. CONCLUSIONS At a single center, occult injury screening was associated with cost variability, resource intensity, and enhanced victim identification when external examination findings or clinical symptoms were absent. While further study is needed, cost and resource concerns associated with screening may be offset by societal benefit and minimal hospital-based financial losses.
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Affiliation(s)
- Stephanie Anne Deutsch
- Department of Pediatrics (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Nemours Children's Health, Wilmington, Del; Sidney Kimmel Medical College of Thomas Jefferson University (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Philadelphia, Pa.
| | - Arezoo Zomorrodi
- Department of Pediatrics (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Nemours Children's Health, Wilmington, Del; Sidney Kimmel Medical College of Thomas Jefferson University (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Philadelphia, Pa
| | - James Zent
- Department of Organizational Finance (J Zent, A Kirk and P O'Brien), Nemours Children's Health, Wilmington, Del
| | - Alexander Kirk
- Department of Organizational Finance (J Zent, A Kirk and P O'Brien), Nemours Children's Health, Wilmington, Del
| | - Paul O'Brien
- Department of Organizational Finance (J Zent, A Kirk and P O'Brien), Nemours Children's Health, Wilmington, Del
| | - Claire Loiselle
- Department of Pediatrics (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Nemours Children's Health, Wilmington, Del; Sidney Kimmel Medical College of Thomas Jefferson University (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Philadelphia, Pa
| | - Allan De Jong
- Department of Pediatrics (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Nemours Children's Health, Wilmington, Del; Sidney Kimmel Medical College of Thomas Jefferson University (SA Deutsch, A Zomorrodi, C Loiselle and A De Jong), Philadelphia, Pa
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Costing the outpatient rehabilitation services: time-driven activity-based costing approach. Cost Eff Resour Alloc 2022; 20:31. [PMID: 35836237 PMCID: PMC9284877 DOI: 10.1186/s12962-022-00366-z] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 09/08/2021] [Accepted: 06/25/2022] [Indexed: 11/10/2022] Open
Abstract
Background Considering the importance of healthcare services costing in resource allocation, the aim of this study is to calculate the cost of rehabilitation services in an outpatient rehabilitation clinic in Tehran, Iran. Methods The data for this study were categorised as financial data and information about the process of rehabilitation services. The first category was extracted from the financial documents and the second was obtained by observation of patient flow and interviews with the clinic staff in 2016. The cost of rehabilitation services has been estimated using the time-driven activity-based costing approach. Results The findings show that the cost of physical occupational therapy in the Asma rehabilitation center was $18.79 per unit of service. This amount for speech therapy services was $17.23 to $19.40, taking into account the difference in the quality of the service delivered. The cost of mental health occupational therapy service was between $19.46 and $23.57. Comparing the cost of these services with the government’s tariffs makes it clear that there is a huge gap. Conclusion The limited number of patients referred to the center makes the cost of one unit of rehabilitation services much higher than the official tariffs. This is true for almost all similar institutions and makes the profitability of small rehabilitation institutions extremely unstable. Therefore, proper marketing for rehabilitation services by promoting patient referral links with larger healthcare centers and reallocation of resources to the formation of integrated rehabilitation complexes can play a significant role in their profitability.
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Alibrahim A, Abdulsalam Y, Al Mutawa S, Behbehani H, Alhuwail D, Al Jenaei S. Towards value-based healthcare: Establishing baseline pharmacy care costs for diabetes management. Int J Health Plann Manage 2021; 37:790-803. [PMID: 34713500 DOI: 10.1002/hpm.3370] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 05/27/2020] [Revised: 10/08/2021] [Accepted: 10/10/2021] [Indexed: 11/06/2022] Open
Abstract
The prevalence of diabetes has increased by three folds over the last 20 years, and the global cost of diabetes mellitus surpassed one trillion US Dollars (USD) or 1.8% of the global GDP in 2015. Generally, prescription medication to treat complications of diabetes makes up nearly 30% of diabetes medical expenditures. To facilitate value-based decision-making at national and organizational levels, we analyzed the cost drivers of pharmacy services in a diabetes care institute by developing a flexible costing model that accounts for pharmaceuticals and labour costs of pharmacy processes. We calculated the direct pharmaceutical costs and the indirect labour costs at the activity level from electronic health records and observational data. On average, the cost of pharmacy services over 1 year was equivalent to 1246 USD per diabetes patient. Approximately 98% of the pharmacy costs were pharmaceutical costs, while 2% were attributable to labour. The flexible costing model and cost estimates are essential for value-based comparisons of interventions and care redesign. The outlined costing framework and findings carry implications nationally and organizationally to accelerate the path towards value-based healthcare delivery and provider reimbursement schemes through agile cost estimation, efficiency improvements, and higher value of care.
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Affiliation(s)
- Abdullah Alibrahim
- Department of Industrial and Management Systems Engineering, College of Engineering and Petroleum, Kuwait University, Safat, Kuwait.,Dasman Diabetes Institute, Kuwait City, Kuwait
| | - Yousef Abdulsalam
- Department of Information Systems & Operations Management, College of Business Administration, Kuwait University, Safat, Kuwait
| | - Salma Al Mutawa
- Department of Industrial and Management Systems Engineering, College of Engineering and Petroleum, Kuwait University, Safat, Kuwait
| | | | - Dari Alhuwail
- Dasman Diabetes Institute, Kuwait City, Kuwait.,Department of Information Science, College of Computing Sciences and Engineering, Kuwait University, Safat, Kuwait
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da Silva Etges APB, Cruz LN, Schlatter R, Neyeloff J, Cardoso RB, Kopittke L, Nunes AA, Neto JA, Nogueira JL, de Assis RM, Tobias JSP, Marin-Neto JA, Moreira LB, Polanczyk CA. Time-driven activity-based costing as a strategy to increase efficiency: An analyses of interventional coronary procedures. Int J Health Plann Manage 2021; 37:189-201. [PMID: 34505319 DOI: 10.1002/hpm.3320] [Citation(s) in RCA: 2] [Impact Index Per Article: 0.7] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/23/2021] [Revised: 08/16/2021] [Accepted: 08/23/2021] [Indexed: 11/07/2022] Open
Abstract
Monitoring the costs is one of the key components underlying value-based health care. This study aimed to evaluate the cost-saving opportunities of interventional coronary procedures (ICPs). Data from 90 patients submitted to elective ICP were evaluated in five Brazilian hospitals. Time-driven activity-based costing, that guides the cost estimates using the time consumed and the capacity cost rates per resource as the data input, was used to assess costs and the time spent over the care pathway. Descriptive cost analyses were followed by a labour cost-saving estimate potentially achieved by the redesign of the ICP pathway. The mean cost per patient varied from $807 to $2639. The length of the procedure phase per patient was similar among the hospitals, while the post-procedure phase presented the highest variation in length. The highest direct cost saving opportunities are concentrated in the procedure phase. By comparing the benchmark service with the most expensive one, it was estimated that redesigning physician practices could decrease 51% of the procedure cost. This application is pioneered in Brazil and demonstrates how detailed cost information can contribute to driving health care management to value by identifying cost-saving opportunities.
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Affiliation(s)
- Ana Paula Beck da Silva Etges
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Porto Alegre, Rio Grande do Sul, Brazil
- Programa de Pós-graduação em Epidemiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, Rio Grande do Sul, Brazil
- School of Technology, Pontifícia Universidade Católica do Rio Grande do Sul, Porto Alegre, Rio Grande do Sul, Brazil
- The TDABC in Healthcare Consortium, Porto Alegre, Rio Grande do Sul, Brazil
| | - Luciane Nascimento Cruz
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Porto Alegre, Rio Grande do Sul, Brazil
- Hospital Moinhos de Vento, Porto Alegre, Rio Grande do Sul, Brazil
| | - Rosane Schlatter
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Porto Alegre, Rio Grande do Sul, Brazil
- Hospital de Clínicas de Porto Alegre, Porto Alegre, Rio Grande do Sul, Brazil
| | - Jeruza Neyeloff
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Porto Alegre, Rio Grande do Sul, Brazil
- Hospital de Clínicas de Porto Alegre, Porto Alegre, Rio Grande do Sul, Brazil
| | - Ricardo Bertoglio Cardoso
- Programa de Pós-graduação em Epidemiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, Rio Grande do Sul, Brazil
- The TDABC in Healthcare Consortium, Porto Alegre, Rio Grande do Sul, Brazil
- Hospital Moinhos de Vento, Porto Alegre, Rio Grande do Sul, Brazil
| | - Luciane Kopittke
- Grupo Hospitalar Nossa Senhora da Conceição, Porto Alegre, Rio Grande do Sul, Brazil
| | | | - José Alburquerque Neto
- Hospital Universitário Presidente Dutra da Universidade Federal do Maranhão, São Luís, Maranhão, Brazil
| | - José Luiz Nogueira
- Hospital das Clínicas da Universidade Federal de Minas Gerais, Belo Horizonte, Minas Gerais, Brazil
| | - Renata Melo de Assis
- Hospital Universitário Presidente Dutra da Universidade Federal do Maranhão, São Luís, Maranhão, Brazil
| | | | - José Antonio Marin-Neto
- Hospital das Clínicas da Faculdade de Medicina de Ribeirão Preto, Ribeirão Preto, São Paulo, Brazil
| | | | - Carisi Anne Polanczyk
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Porto Alegre, Rio Grande do Sul, Brazil
- Programa de Pós-graduação em Epidemiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, Rio Grande do Sul, Brazil
- The TDABC in Healthcare Consortium, Porto Alegre, Rio Grande do Sul, Brazil
- Hospital Moinhos de Vento, Porto Alegre, Rio Grande do Sul, Brazil
- Hospital de Clínicas de Porto Alegre, Porto Alegre, Rio Grande do Sul, Brazil
- Programa de Pós-graduação em Cardiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, Rio Grande do Sul, Brazil
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Nagra NS, Tsangaris E, Means J, Hassett MJ, Dominici LS, Bellon JR, Broyles J, Kaplan RS, Feeley TW, Pusic AL. Time-Driven Activity-Based Costing in Breast Cancer Care Delivery. Ann Surg Oncol 2021; 29:510-521. [PMID: 34374913 DOI: 10.1245/s10434-021-10465-5] [Citation(s) in RCA: 0] [Impact Index Per Article: 0] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 04/21/2021] [Accepted: 06/29/2021] [Indexed: 11/18/2022]
Abstract
BACKGROUND Accurate measurement of healthcare costs is required to assess and improve the value of oncology care. OBJECTIVES We aimed to determine the cost of breast cancer care provision across collaborating health care organizations. METHODS We used time-driven activity-based costing (TDABC) to calculate the complete cost of breast cancer care-initial treatment planning, chemotherapy, radiation therapy, surgical resection and reconstruction, and ancillary services (e.g., psychosocial oncology, physical therapy)-across multiple hospital sites. Data were collected between December 2019 and February 2020. TDABC steps involved (1) developing process maps for care delivery pathways; (2) determine capacity cost rates for staff, medical equipment, and hospital space; (3) measure the time required for each process step, both manually through clinic observation and using data from the Real-Time Location System (RTLS); and (4) calculate the total cost of care delivery. RESULTS Surgical care costs ranged from $1431 for a lumpectomy to $12,129 for a mastectomy with prepectoral implant reconstruction. Radiation therapy was costed at $1224 for initial simulation and patient education, and $200 for each additional treatment. Base costs for chemotherapy delivery were $382 per visit, with additional costs driven by chemotherapy agent(s) administered. Personnel expenses were the greatest contributor to the cost of surgical care, except in mastectomy with implant reconstruction, where device costs equated to up to 60% of the cost of surgery. CONCLUSION The cost of complete breast cancer care depended on (1) treatment protocols; (2) patient choice of reconstruction; and (3) the need for ancillary services (e.g., physical therapy). Understanding the actual costs and cost drivers of breast cancer care delivery may better inform resource utilization to lower the cost and improve the quality of care.
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Affiliation(s)
- Navraj S Nagra
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA, USA. .,Institute for Strategy and Competitiveness, Harvard Business School, Boston, MA, USA.
| | - Elena Tsangaris
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA, USA
| | - Jessica Means
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA, USA
| | | | | | | | - Justin Broyles
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA, USA
| | - Robert S Kaplan
- Institute for Strategy and Competitiveness, Harvard Business School, Boston, MA, USA
| | - Thomas W Feeley
- Institute for Strategy and Competitiveness, Harvard Business School, Boston, MA, USA
| | - Andrea L Pusic
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA, USA
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Thaker NG, Kudchadker RJ, Incalcaterra JR, Bathala TK, Kaplan RS, Agarwal A, Kuban DA, Frank BD, Das P, Feeley TW, Frank SJ. Improving efficiency and reducing costs of MRI-Guided prostate brachytherapy using Time-Driven Activity-Based costing. Brachytherapy 2021; 21:49-54. [PMID: 34389265 DOI: 10.1016/j.brachy.2021.05.012] [Citation(s) in RCA: 1] [Impact Index Per Article: 0.3] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/30/2020] [Revised: 05/15/2021] [Accepted: 05/21/2021] [Indexed: 11/15/2022]
Abstract
INTRODUCTION Integrated quality improvement (QI) and cost reduction strategies can help increase value in cancer care. Time-driven activity-based costing (TDABC) is a bottom-up costing tool that measures resource use over the full care cycle. We applied standard QI and TDABC methods to improve workflow efficiency and reduce costs for MRI-guided prostate brachytherapy. METHODS AND MATERIALS We constructed process maps of the baseline prostate brachytherapy workflow from initial consultation through one year after treatment. Process maps reflected resources and time required at each step. TDABC costs were calculated by multiplying each process time by the cost per min of the resource(s) used at that step. We then used plan-do-study-act methodology to identify workflow inefficiencies and implement solutions to reduce resource consumption. RESULTS The highest cost components at baseline were the operating room (OR) (40%), imaging (8.7%), and consultation (7.6%). Higher-than-expected costs (3%) were incurred during surgery scheduling. After targeted QI initiatives, OR time was reduced from 90 to 70 min, which reduced overall cost by 5%. Personnel task downshifting reduced costs by 10% at consultation and 77% at surgery scheduling. Re-engineering of follow-up protocols reduced costs by 8.4%. Costs under the new workflow decreased by 18.2%. CONCLUSIONS TDABC complements traditional QI initiatives by quantifying the highest cost steps and focusing QI initiatives to reduce costs and improve efficiency. As payment reform evolves toward bundled payments, TDABC and QI initiatives will help providers understand, communicate, and improve the value of cancer care.
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Affiliation(s)
- Nikhil G Thaker
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX; Division of Radiation Oncology, Arizona Oncology, The US Oncology Network, Tucson, AZ
| | - Rajat J Kudchadker
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - James R Incalcaterra
- The Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, TX
| | | | | | - Ankit Agarwal
- Department of Radiation Oncology, The University of North Carolina, Chapel Hill, NC
| | - Deborah A Kuban
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | | | - Prajnan Das
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | | | - Steven J Frank
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX.
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Thaker NG, Boyce-Fappiano D, Ning MS, Pasalic D, Guzman A, Smith G, Holliday EB, Incalcaterra J, Garden AS, Shaitelman SF, Gunn GB, Fuller CD, Blanchard P, Feeley TW, Kaplan RS, Frank SJ. Activity-Based Costing of Intensity-Modulated Proton versus Photon Therapy for Oropharyngeal Cancer. Int J Part Ther 2021; 8:374-382. [PMID: 34285963 PMCID: PMC8270081 DOI: 10.14338/ijpt-20-00042.1] [Citation(s) in RCA: 5] [Impact Index Per Article: 1.7] [Reference Citation Analysis] [Abstract] [Key Words] [Grants] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 08/15/2020] [Accepted: 01/11/2021] [Indexed: 11/29/2022] Open
Abstract
PURPOSE In value-based health care delivery, radiation oncologists need to compare empiric costs of care delivery with advanced technologies, such as intensity-modulated proton therapy (IMPT) and intensity-modulated radiation therapy (IMRT). We used time-driven activity-based costing (TDABC) to compare the costs of delivering IMPT and IMRT in a case-matched pilot study of patients with newly diagnosed oropharyngeal (OPC) cancer. MATERIALS AND METHODS We used clinicopathologic factors to match 25 patients with OPC who received IMPT in 2011-12 with 25 patients with OPC treated with IMRT in 2000-09. Process maps were created for each multidisciplinary clinical activity (including chemotherapy and ancillary services) from initial consultation through 1 month of follow-up. Resource costs and times were determined for each activity. Each patient-specific activity was linked with a process map and TDABC over the full cycle of care. All calculated costs were normalized to the lowest-cost IMRT patient. RESULTS TDABC costs for IMRT were 1.00 to 3.33 times that of the lowest-cost IMRT patient (mean ± SD: 1.65 ± 0.56), while costs for IMPT were 1.88 to 4.32 times that of the lowest-cost IMRT patient (2.58 ± 0.39) (P < .05). Although single-fraction costs were 2.79 times higher for IMPT than for IMRT (owing to higher equipment costs), average full cycle cost of IMPT was 1.53 times higher than IMRT, suggesting that the initial cost increase is partly mitigated by reductions in costs for other, non-RT supportive health care services. CONCLUSIONS In this matched sample, although IMPT was on average more costly than IMRT primarily owing to higher equipment costs, a subset of IMRT patients had similar costs to IMPT patients, owing to greater use of supportive care resources. Multidimensional patient outcomes and TDABC provide vital methodology for defining the value of radiation therapy modalities.
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Affiliation(s)
- Nikhil G. Thaker
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
- Arizona Oncology, The US Oncology Network, Tucson, AZ, USA
| | - David Boyce-Fappiano
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Matthew S. Ning
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Dario Pasalic
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Alexis Guzman
- The Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Grace Smith
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Emma B. Holliday
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - James Incalcaterra
- The Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Adam S. Garden
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Simona F. Shaitelman
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - G. Brandon Gunn
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - C. David Fuller
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | - Pierre Blanchard
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
| | | | | | - Steven J. Frank
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX, USA
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Etges APBDS, Polanczyk CA, Urman RD. A standardized framework to evaluate the quality of studies using TDABC in healthcare: the TDABC in Healthcare Consortium Consensus Statement. BMC Health Serv Res 2020; 20:1107. [PMID: 33256733 PMCID: PMC7706254 DOI: 10.1186/s12913-020-05869-0] [Citation(s) in RCA: 15] [Impact Index Per Article: 3.8] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 06/03/2020] [Accepted: 10/27/2020] [Indexed: 12/13/2022] Open
Abstract
BACKGROUND This Consensus Statement introduces a standardized framework, in a checklist format, to support future development and reporting of TDABC studies in healthcare, and to encourage their reproducibility. Additionally, it establishes the first formal networking of TDABC researchers through the creation of the TDABC in Healthcare Consortium. METHODS A consensus group of researchers reviewed the most relevant TDABC studies available in Medline and Scopus databases to identify the initial elements of the checklist. Using a Focus Group process, each element received a recommendation regarding where in the scientific article section it should be placed and whether the element was required or suggested. A questionnaire was circulated with expert researchers in the field to provide additional recommendations regarding the content of the checklist and the strength of recommendation for each included element. RESULTS The TDABC standardized framework includes 32 elements, provides recommendations where in the scientific article to include each element, and comments on the strength of each recommendation. All 32 elements were validated, with 21 elements classified as mandatory and 11 as suggested but not mandatory. CONCLUSIONS This is the first standardized framework to support the development and reporting of TDABC research in healthcare and to stablish a community of experts in TDABC methodology. We expect that it can contribute to scale strategies that would result in cost-savings outcomes and in value-oriented strategies that can be adopted in healthcare systems and institutions.
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Affiliation(s)
- Ana Paula Beck da Silva Etges
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Ramiro Barcelos 2350, Porto Alegre, Brazil.
- School of Technology, Pontifícia Universidade Católica do Rio Grande do Sul, Porto Alegre, Brazil.
- Programa de Pós-graduação em Epidemiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, RS, Brazil.
- , .
| | - Carisi Anne Polanczyk
- National Institute of Science and Technology for Health Technology Assessment (IATS)- CNPq/Brazil (project: 465518/2014-1), Ramiro Barcelos 2350, Porto Alegre, Brazil
- Programa de Pós-graduação em Epidemiologia da Escola de Medicina da Universidade Federal do Rio Grande do Sul, Porto Alegre, RS, Brazil
- Hospital Moinhos de Vento, Porto Alegre, Brazil
| | - Richard D Urman
- Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital/Harvard Medical School, Boston, MA, USA
- Center for Perioperative Research, Brigham and Women's Hospital, Boston, MA, USA
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Time-Driven Activity-Based Costing of Emergency Department Postdischarge Nurse Calls. J Healthc Manag 2020; 65:419-428. [PMID: 33186257 DOI: 10.1097/jhm-d-19-00128] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/26/2022]
Abstract
EXECUTIVE SUMMARY Postdischarge telephone calls by nurses can decrease patient return rates to healthcare systems. To date, call program costs have not been compared with patient return rates to determine cost-effectiveness. We used time-driven activity-based costing to determine the costs associated with such programs. We developed process maps for a postdischarge nurse call program in the emergency department of an urban, quaternary care, academic, Level 1 trauma center. Our primary outcome was the total cost of calls, which is based on the length of the calls (after 8 hours of observation) and the total capacity rate cost based on national registered nurse salary and space costs. Seven-day return rate differences between patients reached and those not reached from July 2018 to March 2019 were determined with a Z-test. We observed 113 postdischarge calls for 79 patients. The mean (SD) length of calls for patients reached was 4.3 minutes (1.8) compared with 2.6 minutes (0.6) for those not reached. The total capacity rate cost for calls was $1.09/minute, or $4.69 per patient reached and $2.83 per patient not reached. A retrospective analysis of 6,698 patients reached and 6,519 patients not reached showed hospital return rates of 3.5% and 6.3% (p < .0001), respectively. The study findings show that postdischarge calls were associated with decreased return rates to the emergency department and a savings of $134.89 per prevention of one return. In deciding whether to use postdischarge call programs, healthcare systems should also consider the effects on specific demographics and the potential benefits of greater patient satisfaction and increased treatment adherence.
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Masthoff M, Schneider KN, Schindler P, Heindel W, Köhler M, Schlüchtermann J, Wildgruber M. Value Improvement by Assessing IR Care via Time-Driven Activity-Based Costing. J Vasc Interv Radiol 2020; 32:262-269. [PMID: 33139185 DOI: 10.1016/j.jvir.2020.09.017] [Citation(s) in RCA: 7] [Impact Index Per Article: 1.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 03/20/2020] [Revised: 09/07/2020] [Accepted: 09/08/2020] [Indexed: 11/29/2022] Open
Abstract
PURPOSE To evaluate time-driven activity-based costing (TDABC) in interventional radiology for image-guided vascular malformation treatment as an example. MATERIALS AND METHODS Retrospective analysis was performed on consecutive vascular malformation treatment cycles [67 venous malformations (VMs) and 11 arteriovenous malformations (AVMs)] in a university hospital in 2018. All activities were integrated with a process map, and spent resources were assigned accordingly. TDABC uses 2 parameters: (i) practical capacity cost rate, calculated as 80% of theoretical capacity, and (ii) time consumption of each resource determined by interviews (23 items). Thereby, the total costs were calculated. Treatment cycles were modified according to identified resource waste and TDABC-guided negotiations with health insurance. RESULTS Total personnel time required was higher for AVM (1,191 min) than for VM (637 min) treatment. The interventional procedure comprised the major part (46%) of personnel time required in AVM, whereas it comprised 19% in VM treatment. Materials represented the major cost type in AVM (75%) and VM (45%) treatments. TDABC-based treatment process modification led to a decrease in personnel time need of 16% and 30% and a cost reduction of 5.5% and 15.7% for AVM and VM treatments, respectively. TDABC-guided cost reduction and TDABC-informed negotiations improved profit from -56% to +40% and from +41% to +69% for AVM and VM treatments, respectively. CONCLUSIONS TDABC facilitated the precise costing of interventional radiologic treatment cycles and optimized internal processes, cost reduction, and revenues. Hence, TDABC is a promising tool to determine the denominator of interventional radiology's value.
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Affiliation(s)
- Max Masthoff
- Institute of Clinical Radiology, University Hospital Muenster, Muenster, Germany.
| | | | - Philipp Schindler
- Institute of Clinical Radiology, University Hospital Muenster, Muenster, Germany
| | - Walter Heindel
- Institute of Clinical Radiology, University Hospital Muenster, Muenster, Germany
| | - Michael Köhler
- Institute of Clinical Radiology, University Hospital Muenster, Muenster, Germany
| | - Jörg Schlüchtermann
- Faculty of Law, Business and Economics, University of Bayreuth, Bayreuth, Germany
| | - Moritz Wildgruber
- Institute of Clinical Radiology, University Hospital Muenster, Muenster, Germany; Klinik und Poliklinik für Radiologie, Klinikum der Universität München, Munich, Germany
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Haque A, Milstein A, Fei-Fei L. Illuminating the dark spaces of healthcare with ambient intelligence. Nature 2020; 585:193-202. [PMID: 32908264 DOI: 10.1038/s41586-020-2669-y] [Citation(s) in RCA: 63] [Impact Index Per Article: 15.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/16/2020] [Accepted: 07/14/2020] [Indexed: 11/09/2022]
Abstract
Advances in machine learning and contactless sensors have given rise to ambient intelligence-physical spaces that are sensitive and responsive to the presence of humans. Here we review how this technology could improve our understanding of the metaphorically dark, unobserved spaces of healthcare. In hospital spaces, early applications could soon enable more efficient clinical workflows and improved patient safety in intensive care units and operating rooms. In daily living spaces, ambient intelligence could prolong the independence of older individuals and improve the management of individuals with a chronic disease by understanding everyday behaviour. Similar to other technologies, transformation into clinical applications at scale must overcome challenges such as rigorous clinical validation, appropriate data privacy and model transparency. Thoughtful use of this technology would enable us to understand the complex interplay between the physical environment and health-critical human behaviours.
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Affiliation(s)
- Albert Haque
- Department of Computer Science, Stanford University, Stanford, CA, USA
| | - Arnold Milstein
- Clinical Excellence Research Center, Stanford University School of Medicine, Stanford, CA, USA
| | - Li Fei-Fei
- Department of Computer Science, Stanford University, Stanford, CA, USA. .,Stanford Institute for Human-Centered Artificial Intelligence, Stanford University, Stanford, CA, USA.
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Keel G, Muhammad R, Savage C, Spaak J, Gonzalez I, Lindgren P, Guttmann C, Mazzocato P. Time-driven activity-based costing for patients with multiple chronic conditions: a mixed-method study to cost care in a multidisciplinary and integrated care delivery centre at a university-affiliated tertiary teaching hospital in Stockholm, Sweden. BMJ Open 2020; 10:e032573. [PMID: 32499252 PMCID: PMC7279642 DOI: 10.1136/bmjopen-2019-032573] [Citation(s) in RCA: 7] [Impact Index Per Article: 1.8] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 12/14/2022] Open
Abstract
OBJECTIVE This study can be applied to cost the complex non-standardised processes used to treat patients with multiple chronic conditions. DESIGN A mixed-method approach to cost analysis, following a modified healthcare-specific version of the seven-step Time-Driven Activity-Based Costing (TDABC) approach. SETTING A multidisciplinary integrated and person-centred care delivery centre at a university-affiliated tertiary teaching hospital in Stockholm, Sweden, designed to improve care coordination for patients with multiple chronic conditions, specifically diabetes, cardiovascular disease and kidney disease. PARTICIPANTS 314 patients (248 men and 66 women) fit inclusion criteria. Average age was 80 years. RESULTS This modified TDABC analysis costed outpatient care for patients with multiple chronic conditions. The approach accounted for the difficulty of conceptualising care cycles. The estimated total cost, stratified by resources, can be reviewed together with existing managerial accounting statements to inform management decisions regarding the multidisciplinary centre. CONCLUSIONS This article demonstrates that the healthcare-specific seven-step approach to TDABC can be applied to cost care for patients with multiple chronic conditions, where pathways are not yet discernable. It became clear that there was a need for slight methodological adaptations for this particular patient group to make it possible to cost these pathways, stratified by activity and resource. The value of this approach can be discerned from the way management incorporated the results of this analysis into the development of their hospital strategy. In the absence of integrated data infrastructures that can link patients and resources across financial, clinical and process data sets, the scalability of this method will be difficult.
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Affiliation(s)
- George Keel
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Rafiq Muhammad
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Carl Savage
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Jonas Spaak
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
- Clinical Sciences, Danderyd University Hospital, Karolinska Institutet, Stockholm, Sweden
| | - Ismael Gonzalez
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Peter Lindgren
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Christian Guttmann
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Pamela Mazzocato
- Learning, Informatics, Management, and Ethics, Karolinska Institutet, Stockholm, Sweden
- Research, Development, Education and Innovation, Södertälje Hospital, Södertälje, Sweden
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Etges APBDS, Ruschel KB, Polanczyk CA, Urman RD. Advances in Value-Based Healthcare by the Application of Time-Driven Activity-Based Costing for Inpatient Management: A Systematic Review. VALUE IN HEALTH : THE JOURNAL OF THE INTERNATIONAL SOCIETY FOR PHARMACOECONOMICS AND OUTCOMES RESEARCH 2020; 23:812-823. [PMID: 32540239 DOI: 10.1016/j.jval.2020.02.004] [Citation(s) in RCA: 34] [Impact Index Per Article: 8.5] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Subscribe] [Scholar Register] [Received: 11/15/2019] [Revised: 12/31/2019] [Accepted: 02/12/2020] [Indexed: 06/11/2023]
Abstract
OBJECTIVES Implementation of value-based initiatives depends on cost-assessment methods that can provide high-quality cost information. Time-driven activity-based costing (TDABC) is increasingly being used to solve the cost-information gap. This study aimed to review the use of the TDABC methodology in real-world settings and to estimate its impact on the value-based healthcare concept for inpatient management. METHODS This systematic review was conducted by screening PubMed/MEDLINE and Scopus databases following Preferred Reporting Items for Systematic Reviews and Meta-Analyses guidelines, including all studies up to August 2019. The use of TDABC for inpatient management was the main eligibility criterion. A qualitative approach was used to analyze the different methodological aspects of TDABC and its effective contribution to the implementation of value-based initiatives. RESULTS A total of 1066 studies were retrieved, and 26 full-text articles were selected for review. Only studies focused on surgical inpatient conditions were identified. Most of the studies reported the types of activities on a macrolevel. Professional and structural cost variables were usually assessed. Eighteen studies reported that TDABC contributed to value-based initiatives, especially cost-saving findings. TDABC was satisfactorily applied to achieve value-based contributions in all the studies that used the method for this purpose. CONCLUSIONS TDABC could be a strategy for increasing cost accuracy in real-world settings, and the method could help in the transition from fee-for-service to value-based systems. The results could provide a clearer idea of the costs, help with resource allocation and waste reduction, and might support clinicians and managers in increasing value in a more accurate and transparent way.
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Affiliation(s)
| | - Karen Brasil Ruschel
- National Institute of Science and Technology for Health Technology Assessment, Porto Alegre, Brazil
| | - Carisi Anne Polanczyk
- National Institute of Science and Technology for Health Technology Assessment, Porto Alegre, Brazil; Graduate Program in Cardiology and Cardiovascular Sciences, Universidade Federal do Rio Grande do Sul, Porto Alegre, Brazil
| | - Richard D Urman
- Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital/Harvard Medical School, Boston, MA, USA.
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Are cost advantages from a modern Indian hospital transferable to the United States? Am Heart J 2020; 224:148-155. [PMID: 32402701 PMCID: PMC7194861 DOI: 10.1016/j.ahj.2020.04.009] [Citation(s) in RCA: 7] [Impact Index Per Article: 1.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 04/14/2020] [Accepted: 04/14/2020] [Indexed: 11/24/2022]
Abstract
Background Multiple modern Indian hospitals operate at very low cost while meeting US-equivalent quality accreditation standards. Though US hospitals face intensifying pressure to lower their cost, including proposals to extend Medicare payment rates to all admissions, the transferability of Indian hospitals’ cost advantages to US peers remains unclear. Methods Using time-driven activity-based costing methods, we estimate the average cost of personnel and space for an elective coronary artery bypass graft (CABG) surgery at two American hospitals and one Indian hospital (NH). All three hospitals are Joint Commission accredited and have reputations for use of modern performance management methods. Our case study applies several analytic steps to distinguish transferable from non-transferable sources of NH’s cost savings. Results After removing non-transferable sources of efficiency, NH’s residual cost advantage primarily rests on shifting tasks to less-credentialed and/or less-experienced personnel who are supervised by highly-skilled personnel when perceived risk of complications is low. NH’s high annual CABG volume facilitates such supervised work “downshifting.” The study is subject to limitations inherent in case studies, does not account for the younger age of NH’s patients, or capture savings attributable to NH’s negligible frequency of re-admission or post-acute care facility placement. Conclusions Most transferable bases for a modern Indian hospital’s cost advantage would require more flexible American states’ hospital and health professional licensing regulations, greater family participation in inpatient care, and stronger support by hospital executives and clinicians for substantially lowering the cost of care via regionalization of complex surgeries and weekend use of costly operating rooms.
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Zanotto BS, Etges APBDS, Siqueira AC, Silva RSD, Bastos C, Araujo ALD, Moreira TDC, Matturro L, Polanczyk CA, Gonçalves M. Economic Evaluation of a Telemedicine Service to expand Primary Health Care in Rio Grande do Sul: TeleOftalmo's microcosting analysis. CIENCIA & SAUDE COLETIVA 2020; 25:1349-1360. [PMID: 32267437 DOI: 10.1590/1413-81232020254.28992019] [Citation(s) in RCA: 12] [Impact Index Per Article: 3.0] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 10/03/2019] [Accepted: 10/21/2019] [Indexed: 12/21/2022] Open
Abstract
This study evaluated the cost of public telediagnostic service in ophthalmology. The time-driven activity-based costing method (TDABC) was adopted to examine the cost components related to teleophthalmology. This method allowed us to establish the standard unit cost of telediagnosis, given the installed capacity and utilization of professionals. We considered data from one year of telediagnoses and evaluated the cost per telediagnosis change throughout technology adaptation in the system. The standard cost calculated by distance ophthalmic diagnosis was approximately R$ 119, considering the issuance of 1,080 monthly ophthalmic telediagnostic reports. We identified an imbalance between activities, which suggests the TDABC method's ability to guide management actions and improve resource allocation. The actual unit cost fell from R$ 783 to R$ 283 over one year - with room to approach the estimated standard cost. Partial economic evaluations contribute significantly to support the incorporation of new technologies. The TDABC method deserves prominence, as it enables us to retrieve more accurate information on the cost of technology, improving the scalability and management capacity of the healthcare system.
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Affiliation(s)
- Bruna Stella Zanotto
- Instituto Nacional de Ciência e Tecnologia para Avaliação de Tecnologias em Saúde, Universidade Federal do Rio Grande do Sul. R. Ramiro Barcelos 2350, Santa Cecília. 90035-007 Porto Alegre RS Brasil.
| | - Ana Paula Beck da Silva Etges
- Instituto Nacional de Ciência e Tecnologia para Avaliação de Tecnologias em Saúde, Universidade Federal do Rio Grande do Sul. R. Ramiro Barcelos 2350, Santa Cecília. 90035-007 Porto Alegre RS Brasil.
| | - Ana Célia Siqueira
- Núcleo Técnico-Científico do Programa Telessaúde Brasil-Redes, Programa de Pós-Graduação em Epidemiologia, Faculdade de Medicina, Universidade Federal do Rio Grande do Sul. Porto Alegre RS Brasil
| | - Rodolfo Souza da Silva
- Núcleo Técnico-Científico do Programa Telessaúde Brasil-Redes, Programa de Pós-Graduação em Epidemiologia, Faculdade de Medicina, Universidade Federal do Rio Grande do Sul. Porto Alegre RS Brasil
| | - Cynthia Bastos
- Núcleo Técnico-Científico do Programa Telessaúde Brasil-Redes, Programa de Pós-Graduação em Epidemiologia, Faculdade de Medicina, Universidade Federal do Rio Grande do Sul. Porto Alegre RS Brasil
| | - Aline Lutz de Araujo
- Núcleo Técnico-Científico do Programa Telessaúde Brasil-Redes, Programa de Pós-Graduação em Epidemiologia, Faculdade de Medicina, Universidade Federal do Rio Grande do Sul. Porto Alegre RS Brasil
| | | | | | - Carisi Anne Polanczyk
- Instituto Nacional de Ciência e Tecnologia para Avaliação de Tecnologias em Saúde, Universidade Federal do Rio Grande do Sul. R. Ramiro Barcelos 2350, Santa Cecília. 90035-007 Porto Alegre RS Brasil.
| | - Marcelo Gonçalves
- Núcleo Técnico-Científico do Programa Telessaúde Brasil-Redes, Programa de Pós-Graduação em Epidemiologia, Faculdade de Medicina, Universidade Federal do Rio Grande do Sul. Porto Alegre RS Brasil
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Allin O, Urman RD, Edwards AF, Blitz JD, Pfeifer KJ, Feeley TW, Bader AM. Using Time-Driven Activity-Based Costing to Demonstrate Value in Perioperative Care: Recommendations and Review from the Society for Perioperative Assessment and Quality Improvement (SPAQI). J Med Syst 2019; 44:25. [PMID: 31828517 DOI: 10.1007/s10916-019-1503-2] [Citation(s) in RCA: 11] [Impact Index Per Article: 2.2] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 10/26/2019] [Accepted: 11/14/2019] [Indexed: 12/19/2022]
Abstract
A shift in healthcare payment models from volume toward value-based incentives will require deliberate input into systems development from both perioperative clinicians and administrators to ensure appropriate recognition of the value of all services provided-particularly ones that are not reimbursable in current fee-for-service payment models. Time-driven activity-based costing (TDABC) methodology identifies cost drivers and reduces inaccurate costing based on siloed budgets. Inaccurate costing also results from the fact that current costing methods use charges and there has been tremendous cost shifting throughout health care. High cost, high variability processes can be identified for process improvement. As payment models inevitably evolve towards value-based metrics, it will be critical to knowledgably participate in the coordination of these changes. This document provides 8 practical Recommendations from the Society for Perioperative Assessment and Quality Improvement (SPAQI) aimed at outlining the principles of TDABC, creating process maps for patient workflows, understanding payment structures, establishing physician alignment across service lines to create integrated practice units to facilitate development of evidence-based pathways for specific patient risk groups, establishing consistent care delivery, minimizing variability between physicians and departments, utilizing data analytics and information technology tools to track progress and obtain actionable data, and using TDABC to create costing transparency.
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Affiliation(s)
- Olivia Allin
- Harvard College, Harvard University, Boston, MA, USA
| | - Richard D Urman
- Center for Surgery and Public Health, Brigham and Women's Hospital, Boston, MA, USA. .,Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital, Harvard Medical School, 75 Francis Street CWN L1, Boston, MA, 02115, USA.
| | - Angela F Edwards
- Department of Anesthesiology, Wake Forest School of Medicine, Winston-Salem, NC, USA
| | - Jeanna D Blitz
- Department of Anesthesiology, Duke University School of Medicine, Durham, NC, USA
| | - Kurt J Pfeifer
- Department of Medicine, Medical College of Wisconsin, Milwaukee, WI, USA
| | - Thomas W Feeley
- Institute for Strategy and Competitiveness, Harvard Business School, Harvard University, Boston, MA, USA
| | - Angela M Bader
- Center for Surgery and Public Health, Brigham and Women's Hospital, Boston, MA, USA.,Department of Anesthesiology, Perioperative and Pain Medicine, Brigham and Women's Hospital, Harvard Medical School, 75 Francis Street CWN L1, Boston, MA, 02115, USA
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Cost Comparison of Ultrasound Versus MRI to Diagnose Adolescent Female Patients Presenting with Acute Abdominal/Pelvic Pain Using Time-Driven Activity-Based Costing. Acad Radiol 2019; 26:1618-1624. [PMID: 31064728 DOI: 10.1016/j.acra.2019.03.023] [Citation(s) in RCA: 16] [Impact Index Per Article: 3.2] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 01/17/2019] [Revised: 03/22/2019] [Accepted: 03/28/2019] [Indexed: 12/18/2022]
Abstract
RATIONALE AND OBJECTIVES To compare the cost of ultrasound (US) versus magnetic resonance imaging (MRI) using time-driven activity-based costing in adolescent female patients with suspected appendicitis. MATERIALS AND METHODS Process maps were created using data from electronic medical record review and patient shadowing for adolescent female patients undergoing US or noncontrast MRI exams of the abdomen and pelvis for suspected appendicitis. Capacity cost rates for all personnel, equipment, facilities, and supplies in each exam pathway were established from institutional accounting data. The cost of each process step was determined by multiplying step-specific capacity cost rates by the mean time required to complete the step. Total pathway costs for US and MRI were computed by summing the costs of all steps through each pathway, and a direct cost comparison was made between the two modalities. RESULTS Process maps for US and MRI pathways were generated from 231 and 52 patient encounters, respectively. Patients undergoing US exams followed one of six pathways depending on exam order (abdomen versus pelvis performed first) and whether additional time was needed for bladder filling. Mean total US pathway time was 91 minutes longer than for MRI (US = 166 minutes; MRI = 75 minutes). Total MRI pathway cost was $209.97 compared to a mean US cost of $258.33 (range = $163.21-$293.24). CONCLUSION MRI can be a faster and less costly alternative to US for evaluating suspected appendicitis in adolescent female patients. While precise costs will vary by institution, MRI may be a viable and at times preferable alternative to US in this patient population.
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Using Time-Driven Activity-Based Costing to Model the Costs of Various Process-Improvement Strategies in Acute Pain Management. J Healthc Manag 2019; 63:e76-e85. [PMID: 29985261 DOI: 10.1097/jhm-d-16-00040] [Citation(s) in RCA: 4] [Impact Index Per Article: 0.8] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/26/2022]
Abstract
EXECUTIVE SUMMARY Pain control for patients undergoing thoracic surgery is essential for their comfort and for improving their ability to function after surgery, but it can significantly increase costs. Here, we demonstrate how time-driven activity-based costing (TDABC) can be used to assess personnel costs and create process-improvement strategies.We used TDABC to evaluate the cost of providing pain control to patients undergoing thoracic surgery and to estimate the impact of specific process improvements on cost. Retrospective healthcare utilization data, with a focus on personnel costs, were used to assess cost across the entire cycle of acute pain medicine delivery for these patients. TDABC was used to identify possible improvements in personnel allocation, workflow changes, and epidural placement location and to model the cost savings of those improvements.We found that the cost of placing epidurals in the preoperative holding room was less than that of placing epidurals in the operating room. Personnel reallocation and workflow changes resulted in mean cost reductions of 14% with epidurals in the holding room and 7% cost reductions with epidurals in the operating room. Most cost savings were due to redeploying anesthesiologists to duties that are more appropriate and reducing their unnecessary duties by 30%. Furthermore, the change in epidural placement location alone in 80% of cases reduced costs by 18%. These changes did not compromise quality of care.TDABC can model personnel costs and process improvements in delivering specific healthcare services and justify further investigation of process improvements.
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da Silva Etges APB, Cruz LN, Notti RK, Neyeloff JL, Schlatter RP, Astigarraga CC, Falavigna M, Polanczyk CA. An 8-step framework for implementing time-driven activity-based costing in healthcare studies. THE EUROPEAN JOURNAL OF HEALTH ECONOMICS : HEPAC : HEALTH ECONOMICS IN PREVENTION AND CARE 2019; 20:1133-1145. [PMID: 31286291 DOI: 10.1007/s10198-019-01085-8] [Citation(s) in RCA: 31] [Impact Index Per Article: 6.2] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Subscribe] [Scholar Register] [Received: 09/18/2018] [Accepted: 06/24/2019] [Indexed: 05/20/2023]
Abstract
Micro-costing studies still deserving for methods orientation that contribute to achieve a patient-specific resource use level of analysis. Time-driven activity-based costing (TDABC) is often employed by health organizations in micro-costing studies with that objective. However, the literature shows many deviations in the implementation of TDABC, which might compromise the accuracy of the results obtained. One reason for that can be attributed to the non-existence of a step-by-step orientation to conduct cost analytics with the TDABC specific for micro-costing studies in healthcare. This article aimed at exploring the literature and practical cases to propose an eight-step framework to apply TDABC in micro-costing studies for health care organizations. The 8-step TDABC framework is presented and detailed exploring online spreadsheets already coded to demonstrate data structure and math formula building. A list of analyses that can be performed is suggested, including an explanation about the information that each analysis can provide to increase the organization capability to orient decision making. The case study developed show that actual micro-costing of health care processes can be achieved with the 8-step TDABC framework and its use in future researches can contribute to increase the number of studies that achieve high-quality level in cost information, and consequently, in health resource evaluation.
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Affiliation(s)
- Ana Paula Beck da Silva Etges
- National Health Technology Assessment Institute, CNPq, Porto Alegre, RS, Brazil
- School of Technology, PUCRS, Porto Alegre, RS, Brazil
- Hospital de Cliń icas de Porto Alegre (HCPA), Porto Alegre, RS, Brazil
| | - Luciane Nascimento Cruz
- National Health Technology Assessment Institute, CNPq, Porto Alegre, RS, Brazil
- Hospital Moinhos de Vento, Porto Alegre, RS, Brazil
| | | | - Jeruza Lavanholi Neyeloff
- National Health Technology Assessment Institute, CNPq, Porto Alegre, RS, Brazil
- Hospital de Cliń icas de Porto Alegre (HCPA), Porto Alegre, RS, Brazil
| | - Rosane Paixão Schlatter
- National Health Technology Assessment Institute, CNPq, Porto Alegre, RS, Brazil
- Hospital de Cliń icas de Porto Alegre (HCPA), Porto Alegre, RS, Brazil
| | - Claudia Caceres Astigarraga
- Hospital de Cliń icas de Porto Alegre (HCPA), Porto Alegre, RS, Brazil
- Hospital Moinhos de Vento, Porto Alegre, RS, Brazil
- Unit of Hematology, HCPA, Porto Alegre, RS, Brazil
| | | | - Carisi Anne Polanczyk
- National Health Technology Assessment Institute, CNPq, Porto Alegre, RS, Brazil.
- Hospital de Cliń icas de Porto Alegre (HCPA), Porto Alegre, RS, Brazil.
- Hospital Moinhos de Vento, Porto Alegre, RS, Brazil.
- Department of Cardiology, School of Medicine, UFRGS, Porto Alegre, RS, Brazil.
- National Health Technology Assessment Institute, Universidade Federal Do Rio Grande Do Sul (UFRGS), Ramiro Barcelos, 2350, Building 21-507, Porto Alegre, 90035-903, Brazil.
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McClintock TR, Shah MA, Chang SL, Haleblian GE. Time-Driven Activity-Based Costing in Urologic Surgery Cycles of Care. VALUE IN HEALTH : THE JOURNAL OF THE INTERNATIONAL SOCIETY FOR PHARMACOECONOMICS AND OUTCOMES RESEARCH 2019; 22:768-771. [PMID: 31277822 DOI: 10.1016/j.jval.2019.01.018] [Citation(s) in RCA: 4] [Impact Index Per Article: 0.8] [Reference Citation Analysis] [MESH Headings] [Track Full Text] [Subscribe] [Scholar Register] [Received: 10/17/2018] [Revised: 12/31/2018] [Accepted: 01/10/2019] [Indexed: 06/09/2023]
Affiliation(s)
- Tyler R McClintock
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA, USA
| | | | - Steven L Chang
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA, USA; Center for Surgery and Public Health, Brigham and Women's Hospital, Harvard Medical School, Boston, MA, USA
| | - George E Haleblian
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA, USA.
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McClintock TR, Wang Y, Shah MA, Mossanen M, Chung BI, Chang SL. Hospital Charges for Urologic Surgery Episodes of Care Are Rising Despite Declining Costs. Mayo Clin Proc 2019; 94:995-1002. [PMID: 31079963 DOI: 10.1016/j.mayocp.2019.02.008] [Citation(s) in RCA: 2] [Impact Index Per Article: 0.4] [Reference Citation Analysis] [Abstract] [MESH Headings] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 10/10/2018] [Revised: 01/01/2019] [Accepted: 02/11/2019] [Indexed: 11/29/2022]
Abstract
OBJECTIVE To investigate the temporal relationship of hospital charges relative to recorded costs for surgical episodes of care. PATIENTS AND METHODS This retrospective cohort study selected individuals who underwent any of 8 index urologic surgical procedures at 392 unique institutions from January 1, 2005, through December 31, 2015. For each surgical encounter, cost and charge data reported by hospitals were extracted and adjusted to 2016 US dollars. Trend analysis and multivariable logistic regression modeling were used to assess outcomes. The primary outcome was trend in median charge and cost. Secondary outcomes consisted of hospital characteristics associated with membership in the highest quartile of institutional charge-to-cost ratio. RESULTS Cohort-level median cost per encounter trended down from $6824 in 2005 to $5586 in 2015 (P for trend<.001), and charges increased from $20,210 to $25,773 during the same period (P for trend<.001). Hospitals in the highest quartile of institutional charge-to-cost ratio were more likely to be safety net, nonteaching, urban, lower surgical volume, smaller, and located outside the Midwest (P<.001 for each characteristic). CONCLUSION The pricing trends shown herein could indicate some success in cost-containment for surgical episodes of care, although higher hospital charges may be increasingly used to bolster reimbursement from third-party payers and to compensate for escalating costs in other areas.
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Affiliation(s)
- Tyler R McClintock
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA
| | - Ye Wang
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA; Center for Surgery and Public Health, Brigham and Women's Hospital, Harvard Medical School, Boston, MA
| | | | - Matthew Mossanen
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA
| | | | - Steven L Chang
- Division of Urology, Brigham and Women's Hospital, Harvard Medical School, Boston, MA; Center for Surgery and Public Health, Brigham and Women's Hospital, Harvard Medical School, Boston, MA.
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Time-driven activity-based costing to model the utility of parallel induction redesign in high-turnover operating lists. HEALTHCARE-THE JOURNAL OF DELIVERY SCIENCE AND INNOVATION 2019; 7:100355. [PMID: 30770190 DOI: 10.1016/j.hjdsi.2019.01.003] [Citation(s) in RCA: 7] [Impact Index Per Article: 1.4] [Reference Citation Analysis] [Abstract] [Track Full Text] [Subscribe] [Scholar Register] [Received: 03/09/2018] [Revised: 12/19/2018] [Accepted: 01/28/2019] [Indexed: 11/21/2022]
Abstract
BACKGROUND Value-based healthcare is strongly advocated to reduce the spiralling rise in healthcare expenditure. Operating room efficiency is an important focus of value-based healthcare delivery due to high costs and associated hospital revenue derived from procedural streams of care. A parallel induction design, utilising induction rooms for anesthetising patients, may improve operating room efficiency and optimise revenue. We used time-driven activity-based costing (TDABC) to model personnel costs for a high-turnover operating list to assess value of parallel induction redesign. METHODS We prospectively captured activity data from high-turnover surgery allocated to induction of anesthesia within the operating room (serial design) or within induction rooms prior to completion of preceding surgery (parallel design). Personnel costs were constructed using TDABC following assignment of a case-mix that integrated our activity data. This was contrasted against procedural revenue to assess value of projected case throughput. RESULTS Under a parallel induction design, projected operating list duration was reduced by 55 min at marginal increase (1.6%) in personnel costs as assessed by TDABC. This could facilitate an additional short duration surgical case (e.g. Wide Local Excision, with potential additional revenue of $2818 per day and $0.73 M per annum per operating room. CONCLUSIONS Parallel induction design reduces non-operative time at minimal increase in personnel costs for all-day, high turnover surgery. An additional short duration surgical case is likely feasible under this model and represents a value investment with minimal requirement for additional personnel resources. IMPLICATIONS A parallel induction design, within the constraints of finite healthcare funding, may help alleviate some of the global increase in demand for surgical capacity that accompanies an expanding and aging population.
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French KE, Recinos I, Guzman AB, Aloia TA, Hernandez M, Kee SS, Kowalski AM, Goravanchi F, Cerny J, Cleckler-Hughes KV, Rebello E. Continuous Quality Improvement Measured With Time-Driven Activity-Based Costing in an Outpatient Cancer Surgery Center. J Oncol Pract 2019; 15:e162-e168. [PMID: 30615585 DOI: 10.1200/jop.18.00394] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.6] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/20/2022] Open
Abstract
PURPOSE As health care costs rise, continuous quality improvement and increased efficiency are crucial to reduce costs while providing high-quality care. Time-driven activity-based costing (TDABC) can help identify inefficiencies in processes of cancer care delivery. This study measured the process performance of Port-a-Cath placement in an outpatient cancer surgery center by using TDABC to evaluate patient care process. METHODS Data were collected from the Anesthesia Information Management System database and OneConnect electronic health record (EHR) for Port-a-Cath cases performed throughout four phases: preintervention (phase I), postintervention, stabilization, and pre-new EHR (phases II and III), and post-new EHR (phase IV). TDABC methods were used to map and calculate process times and costs. RESULTS Comparing all phases, as measured with TDABC methodology, a decrease in post-anesthesia care unit (PACU) length of stay (LOS) was identified (83 minutes v 67 minutes; P < .05). The decrease in PACU LOS correlated with increased efficiency and decreasing process costs and PACU nurse resource use by fast tracking patients for Port-a-Cath placement. Port-a-Cath placement success and the functionality of ports remained the same as patient experience improved. CONCLUSION TDABC can be used to evaluate processes of care delivery to patients with cancer and to quantify changes made to those processes. Patients' PACU LOS decreased on the basis of the 2013 Port-a-Cath process improvement initiative and after implementation of a new EHR, over the course of 3 years, as quantified by TDABC. TDABC use can lead to improved efficiencies in patient care delivery that are quantifiable and measurable.
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Affiliation(s)
- Katy E French
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Iris Recinos
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Alexis B Guzman
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Thomas A Aloia
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Mike Hernandez
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Spencer S Kee
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
| | | | | | - Jeffrey Cerny
- 1 The University of Texas MD Anderson Cancer Center, Houston, TX
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Donnelly LF, Lee GM, Sharek PJ. Costs of Quality and Safety in Radiology. Radiographics 2018; 38:1682-1687. [DOI: 10.1148/rg.2018180020] [Citation(s) in RCA: 3] [Impact Index Per Article: 0.5] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/11/2022]
Affiliation(s)
- Lane F. Donnelly
- From the Departments of Radiology (L.F.D.) and Pediatrics (G.M.L., P.J.S.), Stanford University School of Medicine, 180 El Camino Real, Suite M384, MC 5885, Palo Alto, CA 94304; and Department of Quality and Safety, Lucile Packard Children’s Hospital at Stanford, Palo Alto, Calif (L.F.D., G.M.L., P.J.S.)
| | - Grace M. Lee
- From the Departments of Radiology (L.F.D.) and Pediatrics (G.M.L., P.J.S.), Stanford University School of Medicine, 180 El Camino Real, Suite M384, MC 5885, Palo Alto, CA 94304; and Department of Quality and Safety, Lucile Packard Children’s Hospital at Stanford, Palo Alto, Calif (L.F.D., G.M.L., P.J.S.)
| | - Paul J. Sharek
- From the Departments of Radiology (L.F.D.) and Pediatrics (G.M.L., P.J.S.), Stanford University School of Medicine, 180 El Camino Real, Suite M384, MC 5885, Palo Alto, CA 94304; and Department of Quality and Safety, Lucile Packard Children’s Hospital at Stanford, Palo Alto, Calif (L.F.D., G.M.L., P.J.S.)
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Ko EM, Havrilesky LJ, Alvarez RD, Zivanovic O, Boyd LR, Jewell EL, Timmins PF, Gibb RS, Jhingran A, Cohn DE, Dowdy SC, Powell MA, Chalas E, Huang Y, Rathbun J, Wright JD. Society of Gynecologic Oncology Future of Physician Payment Reform Task Force report: The Endometrial Cancer Alternative Payment Model (ECAP). Gynecol Oncol 2018; 149:232-240. [DOI: 10.1016/j.ygyno.2018.02.010] [Citation(s) in RCA: 8] [Impact Index Per Article: 1.3] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/18/2017] [Revised: 02/14/2018] [Accepted: 02/17/2018] [Indexed: 01/07/2023]
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Martin JA, Mayhew CR, Morris AJ, Bader AM, Tsai MH, Urman RD. Using Time-Driven Activity-Based Costing as a Key Component of the Value Platform: A Pilot Analysis of Colonoscopy, Aortic Valve Replacement and Carpal Tunnel Release Procedures. J Clin Med Res 2018; 10:314-320. [PMID: 29511420 PMCID: PMC5827916 DOI: 10.14740/jocmr3350w] [Citation(s) in RCA: 33] [Impact Index Per Article: 5.5] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/31/2017] [Accepted: 01/18/2018] [Indexed: 11/11/2022] Open
Abstract
Background Time-driven activity-based costing (TDABC) is a methodology that calculates the costs of healthcare resources consumed as a patient moves along a care process. Limited data exist on the application of TDABC from the perspective of an anesthesia provider. We describe the use of TDABC, a bottom-up costing strategy and financial outcomes for three different medical-surgical procedures. Methods In each case, a multi-disciplinary team created process maps describing the care delivery cycle for a patient encounter using the TDABC methodology. Each step in a process map delineated an activity required for delivery of patient care. The resources (personnel, equipment and supplies) associated with each step were identified. A per minute cost for each resource expended was generated, known as the capacity cost rate, and multiplied by its time requirement. The total cost for an episode of care was obtained by adding the cost of each individual resource consumed as the patient moved along a clinical pathway. Results We built process maps for colonoscopy in the gastroenterology suite, calculated costs of an aortic valve replacement by comparing surgical aortic valve replacement (SAVR) versus transcatheter aortic valve replacement (TAVR) techniques, and determined the cost of carpal tunnel release in an operating room versus an ambulatory procedure room. Conclusions TDABC is central to the value-based healthcare platform. Application of TDABC provides a framework to identify process improvements for health care delivery. The first case demonstrates cost-savings and improved wait times by shifting some of the colonoscopies scheduled with an anesthesiologist from the main hospital to the ambulatory facility. In the second case, we show that the deployment of an aortic valve via the transcatheter route front loads the costs compared to traditional, surgical replacement. The last case demonstrates significant cost savings to the healthcare system associated with re-organization of staff required to execute a carpal tunnel release.
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Affiliation(s)
- Jacob A Martin
- Department of Anesthesiology, Larner College of Medicine, University of Vermont, Burlington, VT, USA
| | - Christopher R Mayhew
- Department of Anesthesiology, Larner College of Medicine, University of Vermont, Burlington, VT, USA
| | - Amanda J Morris
- Department of Anesthesiology, Perioperative and Pain Medicine, Stanford University School of Medicine, Stanford, CA, USA
| | - Angela M Bader
- Department of Anesthesiology, Perioperative and Pain Medicine, Harvard Medical School, Brigham and Women's Hospital, Boston, MA, USA
| | - Mitchell H Tsai
- Department of Anesthesiology, Larner College of Medicine, University of Vermont, Burlington, VT, USA
| | - Richard D Urman
- Department of Anesthesiology, Perioperative and Pain Medicine, Harvard Medical School, Brigham and Women's Hospital, Boston, MA, USA
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McBain RK, Jerome G, Leandre F, Browning M, Warsh J, Shah M, Mistry B, Faure PAI, Pierre C, Fang AP, Mugunga JC, Gottlieb G, Rhatigan J, Kaplan R. Activity-based costing of health-care delivery, Haiti. Bull World Health Organ 2018; 96:10-17. [PMID: 29403096 PMCID: PMC5791872 DOI: 10.2471/blt.17.198663] [Citation(s) in RCA: 4] [Impact Index Per Article: 0.7] [Reference Citation Analysis] [Abstract] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/02/2016] [Revised: 09/30/2017] [Accepted: 10/02/2017] [Indexed: 11/27/2022] Open
Abstract
Objective To evaluate the implementation of a time-driven activity-based costing analysis at five community health facilities in Haiti. Methods Together with stakeholders, the project team decided that health-care providers should enter start and end times of the patient encounter in every fifth patient's medical dossier. We trained one data collector per facility, who manually entered the time recordings and patient characteristics in a database and submitted the data to a cloud-based data warehouse each week. We calculated the capacity cost per minute for each resource used. An automated web-based platform multiplied reported time with capacity cost rate and provided the information to health-facilities administrators. Findings Between March 2014 and June 2015, the project tracked the clinical services for 7162 outpatients. The cost of care for specific conditions varied widely across the five facilities, due to heterogeneity in staffing and resources. For example, the average cost of a first antenatal-care visit ranged from 6.87 United States dollars (US$) at a low-level facility to US$ 25.06 at a high-level facility. Within facilities, we observed similarly variation in costs, due to factors such as patient comorbidities, patient arrival time, stocking of supplies at facilities and type of visit. Conclusion Time-driven activity-based costing can be implemented in low-resource settings to guide resource allocation decisions. However, the extent to which this information will drive observable changes at patient, provider and institutional levels depends on several contextual factors, including budget constraints, management, policies and the political economy in which the health system is situated.
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Affiliation(s)
- Ryan K McBain
- Partners In Health, 800 Boylston Street, Suite 1400, Boston, Massachusetts, United States of America (USA)
| | | | | | - Micaela Browning
- Partners In Health, 800 Boylston Street, Suite 1400, Boston, Massachusetts, United States of America (USA)
| | | | | | | | | | - Claire Pierre
- Department of Global Health and Social Medicine, Harvard Medical School, Boston, USA
| | | | - Jean Claude Mugunga
- Partners In Health, 800 Boylston Street, Suite 1400, Boston, Massachusetts, United States of America (USA)
| | - Gary Gottlieb
- Partners In Health, 800 Boylston Street, Suite 1400, Boston, Massachusetts, United States of America (USA)
| | - Joseph Rhatigan
- Department of Global Health and Social Medicine, Harvard Medical School, Boston, USA
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Rubin GD. Costing in Radiology and Health Care: Rationale, Relativity, Rudiments, and Realities. Radiology 2017; 282:333-347. [PMID: 28099106 DOI: 10.1148/radiol.2016160749] [Citation(s) in RCA: 63] [Impact Index Per Article: 9.0] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/11/2022]
Abstract
Costs direct decisions that influence the effectiveness of radiology in the care of patients on a daily basis. Yet many radiologists struggle to harness the power of cost measurement and cost management as a critical path toward establishing their value in patient care. When radiologists cannot articulate their value, they risk losing control over how imaging is delivered and supported. In the United States, recent payment trends directing value-based payments for bundles of care advance the imperative for radiology providers to articulate their value. This begins with the development of an understanding of the providers' own costs, as well as the complex interrelationships and imaging-associated costs of other participants across the imaging value chain. Controlling the costs of imaging necessitates understanding them at a procedural level and quantifying the costs of delivering specific imaging services. Effective product-level costing is dependent on a bottom-up approach, which is supported through recent innovations in time-dependent activity-based costing. Once the costs are understood, they can be managed. Within the high fixed cost and high overhead cost environment of health care provider organizations, stakeholders must understand the implications of misaligned top-down cost management approaches that can both paradoxically shift effort from low-cost workers to much costlier professionals and allocate overhead costs counterproductively. Radiology's engagement across a broad spectrum of care provides an excellent opportunity for radiology providers to take a leading role within the health care organizations to enhance value and margin through principled and effective cost management. Following a discussion of the rationale for measuring costs, this review contextualizes costs from the perspectives of a variety of stakeholders (relativity), discusses core concepts in how costs are classified (rudiments), presents common and improved methods for measuring costs in health care, and discusses how cost management strategies can either improve or hinder high-value health care (realities). © RSNA, 2017 Online supplemental material is available for this article.
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Affiliation(s)
- Geoffrey D Rubin
- From the Department of Radiology, Duke University Medical Center, 2424 Erwin Rd, Suite 301, Hock Plaza, Durham, NC 27705
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Bradley SM, Strauss CE, Ho PM. Value in cardiovascular care. Heart 2017; 103:1238-1243. [DOI: 10.1136/heartjnl-2016-309753] [Citation(s) in RCA: 16] [Impact Index Per Article: 2.3] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 01/19/2017] [Revised: 03/31/2017] [Accepted: 04/03/2017] [Indexed: 11/04/2022] Open
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Keel G, Savage C, Rafiq M, Mazzocato P. Time-driven activity-based costing in health care: A systematic review of the literature. Health Policy 2017; 121:755-763. [PMID: 28535996 DOI: 10.1016/j.healthpol.2017.04.013] [Citation(s) in RCA: 194] [Impact Index Per Article: 27.7] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Journal Information] [Subscribe] [Scholar Register] [Received: 05/13/2016] [Revised: 04/27/2017] [Accepted: 04/29/2017] [Indexed: 01/17/2023]
Abstract
Health care organizations around the world are investing heavily in value-based health care (VBHC), and time-driven activity-based costing (TDABC) has been suggested as the cost-component of VBHC capable of addressing costing challenges. The aim of this study is to explore why TDABC has been applied in health care, how its application reflects a seven-step method developed specifically for VBHC, and implications for the future use of TDABC. This is a systematic review following the PRISMA statement. Qualitative methods were employed to analyze data through content analyses. TDABC is applicable in health care and can help to efficiently cost processes, and thereby overcome a key challenge associated with current cost-accounting methods The method's ability to inform bundled payment reimbursement systems and to coordinate delivery across the care continuum remains to be demonstrated in the published literature, and the role of TDABC in this cost-accounting landscape is still developing. TDABC should be gradually incorporated into functional systems, while following and building upon the recommendations outlined in this review. In this way, TDABC will be better positioned to accurately capture the cost of care delivery for conditions and to control cost in the effort to create value in health care.
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Affiliation(s)
- George Keel
- Medical Management Centre, Department of Learning, Informatics, Management and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Carl Savage
- Medical Management Centre, Department of Learning, Informatics, Management and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Muhammad Rafiq
- Medical Management Centre, Department of Learning, Informatics, Management and Ethics, Karolinska Institutet, Stockholm, Sweden
| | - Pamela Mazzocato
- Medical Management Centre, Department of Learning, Informatics, Management and Ethics, Karolinska Institutet, Stockholm, Sweden.
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Anzai Y, Heilbrun ME, Haas D, Boi L, Moshre K, Minoshima S, Kaplan R, Lee VS. Dissecting Costs of CT Study: Application of TDABC (Time-driven Activity-based Costing) in a Tertiary Academic Center. Acad Radiol 2017; 24:200-208. [PMID: 27988200 DOI: 10.1016/j.acra.2016.11.001] [Citation(s) in RCA: 31] [Impact Index Per Article: 4.4] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 10/04/2016] [Accepted: 11/01/2016] [Indexed: 11/17/2022]
Abstract
RATIONALE AND OBJECTIVES The lack of understanding of the real costs (not charge) of delivering healthcare services poses tremendous challenges in the containment of healthcare costs. In this study, we applied an established cost accounting method, the time-driven activity-based costing (TDABC), to assess the costs of performing an abdomen and pelvis computed tomography (AP CT) in an academic radiology department and identified opportunities for improved efficiency in the delivery of this service. MATERIALS AND METHODS The study was exempt from an institutional review board approval. TDABC utilizes process mapping tools from industrial engineering and activity-based costing. The process map outlines every step of discrete activity and duration of use of clinical resources, personnel, and equipment. By multiplying the cost per unit of capacity by the required task time for each step, and summing each component cost, the overall costs of AP CT is determined for patients in three settings, inpatient (IP), outpatient (OP), and emergency departments (ED). RESULTS The component costs to deliver an AP CT study were as follows: radiologist interpretation: 40.1%; other personnel (scheduler, technologist, nurse, pharmacist, and transporter): 39.6%; materials: 13.9%; and space and equipment: 6.4%. The cost of performing CT was 13% higher for ED patients and 31% higher for inpatients (IP), as compared to that for OP. The difference in cost was mostly due to non-radiologist personnel costs. CONCLUSIONS Approximately 80% of the direct costs of AP CT to the academic medical center are related to labor. Potential opportunities to reduce the costs include increasing the efficiency of utilization of CT, substituting lower cost resources when appropriate, and streamlining the ordering system to clarify medical necessity and clinical indications.
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Affiliation(s)
- Yoshimi Anzai
- Department of Radiology, University of Utah School of Medicine Health Sciences, 30 North 1900 East #1A071, Salt Lake City, UT 84132.
| | - Marta E Heilbrun
- Department of Radiology, University of Utah School of Medicine Health Sciences, 30 North 1900 East #1A071, Salt Lake City, UT 84132
| | - Derek Haas
- Harvard Business School, Boston, Massachusetts; Avant-garde Health, Boston, Massachusetts
| | - Luca Boi
- Department of Value Engineer, University of Utah School of Medicine Health Sciences, Salt Lake City, Utah
| | - Kirk Moshre
- Department of Radiology, University of Utah School of Medicine Health Sciences, 30 North 1900 East #1A071, Salt Lake City, UT 84132
| | - Satoshi Minoshima
- Department of Radiology, University of Utah School of Medicine Health Sciences, 30 North 1900 East #1A071, Salt Lake City, UT 84132
| | | | - Vivian S Lee
- Department of Radiology, University of Utah School of Medicine Health Sciences, 30 North 1900 East #1A071, Salt Lake City, UT 84132
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Falit BP, Pan HY, Smith BD, Alexander BM, Zietman AL. The Radiation Oncology Job Market: The Economics and Policy of Workforce Regulation. Int J Radiat Oncol Biol Phys 2016; 96:501-10. [DOI: 10.1016/j.ijrobp.2016.05.029] [Citation(s) in RCA: 24] [Impact Index Per Article: 3.0] [Reference Citation Analysis] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 02/15/2016] [Revised: 05/10/2016] [Accepted: 05/25/2016] [Indexed: 11/29/2022]
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Devji TF, Madenci AL, Carpino E, Leahy IC, Samnaliev M, Dearden JL, Weil BR, Weldon CB, Cravero J. Safety and cost-effectiveness of port removal outside of the operating room among pediatric patients. J Pediatr Surg 2016; 51:1891-1895. [PMID: 27624563 DOI: 10.1016/j.jpedsurg.2016.07.017] [Citation(s) in RCA: 2] [Impact Index Per Article: 0.3] [Reference Citation Analysis] [Abstract] [Key Words] [Track Full Text] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Received: 03/14/2016] [Revised: 07/24/2016] [Accepted: 07/25/2016] [Indexed: 11/16/2022]
Abstract
PURPOSE The current emphasis on fiscally responsible health spending in the era of the Affordable Care Act and other health care reform necessitates cost-conscious delivery of care. "Value" in health care is defined as the quality of care divided by the cost. As such, health systems optimize value by providing the most cost-effective care possible without sacrificing safety or outcomes. Elective, minimal risk surgical procedures in children may be value-enhanced by moving from an operating room (OR) to a more cost-efficient setting. The purpose of this study was to assess the safety and cost of performing the removal of implantable central venous access devices ("ports") in locations other than the main OR. METHODS We compared port removal at three sites: 1. Main OR, 2. Satellite OR, and 3. Clinic Procedure Room. This was a mixed-methods study including a retrospective review of medical records and prospective observation/interviewing. To calculate cost without the inherent biases of hospital charges, costs, and payments, we utilized the methodology of time-driven activity based costing. Specifically, we recorded time spent by the patient in hospital facilities and with health care personnel. This duration was then weighted with the hourly cost of each health care professional and hospital space. The Mann-Whitney U test compared time and cost across the three sites. Overall cost at each site was divided by overall cost at the referent site (Main OR) to obtain a ratio of cost savings. RESULTS A total of 120 patients (40 per site) were included in the analysis. Demographic and clinical factors were not significantly different between sites. No complication occurred with port removal at any site. Time of the entire care episode was significantly decreased in the Clinic (median 161min, 95% confidence interval [CI] 134-188min), compared to the Main OR (median 235min, 95% confidence interval [CI] 209-251min) or Satellite OR (median 228min, 95% confidence interval [CI] 211-245min). Overall cost was decreased by 25% (95% CI: 13-34%) at the Clinic and by 6% (95% CI: -2-11%) at the Satellite OR, compared to the Main OR (referent, P<0.01). CONCLUSION In our study, port removal in the Clinic Procedure Room was not associated with increased risk of negative outcomes. Shifting port removal from the Main OR to the Clinic may result in substantial cost savings.
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Affiliation(s)
- Tehsina F Devji
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA; Harvard School of Dental Medicine, Boston, MA
| | - Arin L Madenci
- Brigham and Women's Hospital and Harvard Medical School, Boston, MA; Department of Surgery, Boston Children's Hospital and Harvard Medical School, Boston, MA
| | - Elizabeth Carpino
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA
| | - Izabela C Leahy
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA
| | - Mihail Samnaliev
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA
| | - Jennifer L Dearden
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA
| | - Brent R Weil
- Department of Surgery, Boston Children's Hospital and Harvard Medical School, Boston, MA
| | - Christopher B Weldon
- Department of Surgery, Boston Children's Hospital and Harvard Medical School, Boston, MA
| | - Joseph Cravero
- Department of Anesthesiology, Preoperative and Pain Medicine, Boston Children's Hospital, Boston, MA.
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Thaker NG, Ali TN, Porter ME, Feeley TW, Kaplan RS, Frank SJ. Communicating Value in Health Care Using Radar Charts: A Case Study of Prostate Cancer. J Oncol Pract 2016; 12:813-20. [PMID: 27577622 PMCID: PMC5508207 DOI: 10.1200/jop.2016.011320] [Citation(s) in RCA: 34] [Impact Index Per Article: 4.3] [Reference Citation Analysis] [Abstract] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/20/2022] Open
Abstract
PURPOSE The transformation from volume to value will require communication of outcomes and costs of therapies; however, outcomes are usually nonstandardized, and cost of therapy differs among stakeholders. We developed a standardized value framework by using radar charts to visualize and communicate a wide range of patient outcomes and cost for three forms of prostate cancer treatment. MATERIALS AND METHODS We retrospectively reviewed data from men with low-risk prostate cancer who were treated with low-dose rate brachytherapy (LDR-BT), proton beam therapy, or robotic-assisted prostatectomy. Patient-reported outcomes comprised the Expanded Prostate Cancer Index Composite-50 domains for sexual function, urinary incontinence and/or bother, bowel bother, and vitality 12 months after treatment. Costs were measured by time-driven activity-based costing for the first 12 months of the care cycle. Outcome and cost data were plotted on a single radar chart for each treatment modality. RESULTS Outcome and cost data from patients who were treated with robotic-assisted prostatectomy (n = 381), proton beam therapy (n = 165), and LDR-BT (n = 238) were incorporated into the radar chart. LDR-BT seemed to deliver the highest overall value of the three treatment modalities; however, incorporation of patient preferences regarding outcomes may allow other modalities to be considered high-value treatment options. CONCLUSION Standardization and visualization of outcome and cost metrics may allow more comprehensive and collaborative discussions about the value of health care services. Communicating the value framework by using radar charts may be an effective method to present total value and the value of all outcomes and costs in a manner that is accessible to all stakeholders. Variations in plotting of costs and outcomes will require future focus group initiatives.
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Affiliation(s)
- Nikhil G Thaker
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
| | - Tariq N Ali
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
| | - Michael E Porter
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
| | - Thomas W Feeley
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
| | - Robert S Kaplan
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
| | - Steven J Frank
- The University of Texas MD Anderson Cancer Center, Houston, TX; Arizona Oncology, The US Oncology Network, Tucson, AZ; The Hospital of the University of Pennsylvania, Philadelphia, PA; and Harvard Business School, Boston, MA
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Ying AK, Feeley TW, Porter ME. Value-based healthcare: implications for thyroid cancer. INTERNATIONAL JOURNAL OF ENDOCRINE ONCOLOGY 2016. [DOI: 10.2217/ije-2015-0005] [Citation(s) in RCA: 1] [Impact Index Per Article: 0.1] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/21/2022] Open
Abstract
Today's delivery of care to thyroid cancer patients is complex, and costly, with uneven outcomes that can be improved. The incidence of thyroid cancer is rising and requires coordinated, multidisciplinary care with high volume centers that is not always available in our current fragmented healthcare system. To address the needs of patients, providers and payers, we believe that thyroid cancer care needs to be reexamined from the perspective of value for the patient, which is defined as the outcomes that matter to patients relative to the cost of delivering them. This paper provides recommendations based on the key principles of the value-based approach to transform the delivery of thyroid cancer care.
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Affiliation(s)
- Anita K Ying
- University of Texas MD Anderson Cancer Center, Houston, TX 77030, USA
| | - Thomas W Feeley
- University of Texas MD Anderson Cancer Center, Houston, TX 77030, USA
- Harvard Business School, Boston, MA 02163, USA
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Thaker NG, Pugh TJ, Mahmood U, Choi S, Spinks TE, Martin NE, Sio TT, Kudchadker RJ, Kaplan RS, Kuban DA, Swanson DA, Orio PF, Zelefsky MJ, Cox BW, Potters L, Buchholz TA, Feeley TW, Frank SJ. Defining the value framework for prostate brachytherapy using patient-centered outcome metrics and time-driven activity-based costing. Brachytherapy 2016; 15:274-282. [PMID: 26916105 PMCID: PMC5502102 DOI: 10.1016/j.brachy.2016.01.003] [Citation(s) in RCA: 34] [Impact Index Per Article: 4.3] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Received: 12/09/2015] [Revised: 01/18/2016] [Accepted: 01/19/2016] [Indexed: 11/19/2022]
Abstract
PURPOSE Value, defined as outcomes over costs, has been proposed as a measure to evaluate prostate cancer (PCa) treatments. We analyzed standardized outcomes and time-driven activity-based costing (TDABC) for prostate brachytherapy (PBT) to define a value framework. METHODS AND MATERIALS Patients with low-risk PCa treated with low-dose-rate PBT between 1998 and 2009 were included. Outcomes were recorded according to the International Consortium for Health Outcomes Measurement standard set, which includes acute toxicity, patient-reported outcomes, and recurrence and survival outcomes. Patient-level costs to 1 year after PBT were collected using TDABC. Process mapping and radar chart analyses were conducted to visualize this value framework. RESULTS A total of 238 men were eligible for analysis. Median age was 64 (range, 46-81). Median followup was 5 years (0.5-12.1). There were no acute Grade 3-5 complications. Expanded Prostate Cancer Index Composite 50 scores were favorable, with no clinically significant changes from baseline to last followup at 48 months for urinary incontinence/bother, bowel bother, sexual function, and vitality. Ten-year outcomes were favorable, including biochemical failure-free survival of 84.1%, metastasis-free survival 99.6%, PCa-specific survival 100%, and overall survival 88.6%. TDABC analysis demonstrated low resource utilization for PBT, with 41% and 10% of costs occurring in the operating room and with the MRI scan, respectively. The radar chart allowed direct visualization of outcomes and costs. CONCLUSIONS We successfully created a visual framework to define the value of PBT using the International Consortium for Health Outcomes Measurement standard set and TDABC costs. PBT is associated with excellent outcomes and low costs. Widespread adoption of this methodology will enable value comparisons across providers, institutions, and treatment modalities.
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Affiliation(s)
- Nikhil G Thaker
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX; The Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Thomas J Pugh
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Usama Mahmood
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Seungtaek Choi
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Tracy E Spinks
- Office of the SVP/Hospitals & Clinics, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Neil E Martin
- Department of Radiation Oncology, Dana-Farber Cancer Institute, Boston, MA
| | - Terence T Sio
- Department of Radiation Oncology, Mayo Clinic, Scottsdale, AZ
| | - Rajat J Kudchadker
- Department of Radiation Physics, The University of Texas MD Anderson Cancer Center, Houston, TX
| | | | - Deborah A Kuban
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - David A Swanson
- Department of Urology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Peter F Orio
- Department of Radiation Oncology, Dana-Farber/Brigham and Women's Cancer Centers, Boston, MA
| | - Michael J Zelefsky
- Department of Radiation Oncology, Memorial Sloan-Kettering Cancer Center, New York, NY
| | - Brett W Cox
- Department of Radiation Oncology, North Shore-LIJ Health System, New York, NY
| | - Louis Potters
- Department of Radiation Oncology, North Shore-LIJ Health System, New York, NY
| | - Thomas A Buchholz
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Thomas W Feeley
- The Institute for Cancer Care Innovation, The University of Texas MD Anderson Cancer Center, Houston, TX; Department of Radiation Physics, The University of Texas MD Anderson Cancer Center, Houston, TX
| | - Steven J Frank
- Department of Radiation Oncology, The University of Texas MD Anderson Cancer Center, Houston, TX.
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Schutzer ME, Arthur DW, Anscher MS. Time-Driven Activity-Based Costing: A Comparative Cost Analysis of Whole-Breast Radiotherapy Versus Balloon-Based Brachytherapy in the Management of Early-Stage Breast Cancer. J Oncol Pract 2016; 12:e584-93. [PMID: 27006360 DOI: 10.1200/jop.2015.008441] [Citation(s) in RCA: 27] [Impact Index Per Article: 3.4] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 01/02/2023] Open
Abstract
PURPOSE Value in health care is defined as outcomes achieved per dollar spent, and understanding cost is critical to delivering high-value care. Traditional costing methods reflect charges rather than fundamental costs to provide a service. The more rigorous method of time-driven activity-based costing was used to compare cost between whole-breast radiotherapy (WBRT) and accelerated partial-breast irradiation (APBI) using balloon-based brachytherapy. MATERIALS AND METHODS For WBRT (25 fractions with five-fraction boost) and APBI (10 fractions twice daily), process maps were created outlining each activity from consultation to post-treatment follow up. Through staff interviews, time estimates were obtained for each activity. The capacity cost rates (CCR), defined as cost per minute, were calculated for personnel, equipment, and physical space. Total cost was calculated by multiplying the time required of each resource by its CCR. This was then summed and combined with cost of consumable materials. RESULTS The total cost for WBRT was $5,333 and comprised 56% personnel costs and 44% space/equipment costs. For APBI, the total cost was $6,941 (30% higher than WBRT) and comprised 51% personnel costs, 6% space/equipment costs, and 43% consumable materials costs. The attending physician had the highest CCR of all personnel ($4.28/min), and APBI required 24% more attending time than WBRT. The most expensive activity for APBI was balloon placement and for WBRT was computed tomography simulation. CONCLUSION APBI cost more than WBRT when using the dose/fractionation schemes analyzed. Future research should use time-driven activity-based costing to better understand cost with the aim of reducing expenditure and defining bundled payments.
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Affiliation(s)
- Matthew E Schutzer
- Hunter Holmes McGuire Veterans Affairs Medical Center; Virginia Commonwealth University Hospital, Richmond, VA
| | - Douglas W Arthur
- Hunter Holmes McGuire Veterans Affairs Medical Center; Virginia Commonwealth University Hospital, Richmond, VA
| | - Mitchell S Anscher
- Hunter Holmes McGuire Veterans Affairs Medical Center; Virginia Commonwealth University Hospital, Richmond, VA
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Tan RY, Met-Domestici M, Zhou K, Guzman AB, Lim ST, Soo KC, Feeley TW, Ngeow J. Using Quality Improvement Methods and Time-Driven Activity-Based Costing to Improve Value-Based Cancer Care Delivery at a Cancer Genetics Clinic. J Oncol Pract 2016; 12:e320-31. [DOI: 10.1200/jop.2015.007765] [Citation(s) in RCA: 20] [Impact Index Per Article: 2.5] [Reference Citation Analysis] [Abstract] [Track Full Text] [Journal Information] [Subscribe] [Scholar Register] [Indexed: 11/20/2022] Open
Abstract
Purpose: To meet increasing demand for cancer genetic testing and improve value-based cancer care delivery, National Cancer Centre Singapore restructured the Cancer Genetics Service in 2014. Care delivery processes were redesigned. We sought to improve access by increasing the clinic capacity of the Cancer Genetics Service by 100% within 1 year without increasing direct personnel costs. Methods: Process mapping and plan-do-study-act (PDSA) cycles were used in a quality improvement project for the Cancer Genetics Service clinic. The impact of interventions was evaluated by tracking the weekly number of patient consultations and access times for appointments between April 2014 and May 2015. The cost impact of implemented process changes was calculated using the time-driven activity-based costing method. Results: Our study completed two PDSA cycles. An important outcome was achieved after the first cycle: The inclusion of a genetic counselor increased clinic capacity by 350%. The number of patients seen per week increased from two in April 2014 (range, zero to four patients) to seven in November 2014 (range, four to 10 patients). Our second PDSA cycle showed that manual preappointment reminder calls reduced the variation in the nonattendance rate and contributed to a further increase in patients seen per week to 10 in May 2015 (range, seven to 13 patients). There was a concomitant decrease in costs of the patient care cycle by 18% after both PDSA cycles. Conclusion: This study shows how quality improvement methods can be combined with time-driven activity-based costing to increase value. In this paper, we demonstrate how we improved access while reducing costs of care delivery.
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Affiliation(s)
- Ryan Y.C. Tan
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Marie Met-Domestici
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Ke Zhou
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Alexis B. Guzman
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Soon Thye Lim
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Khee Chee Soo
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Thomas W. Feeley
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
| | - Joanne Ngeow
- National Cancer Centre Singapore; Duke-National University of Singapore Graduate Medical School, Singapore; The University of Texas MD Anderson Cancer Center, Houston, TX; and Harvard Business School, Boston, MA
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French KE, Guzman AB, Rubio AC, Frenzel JC, Feeley TW. Value based care and bundled payments: Anesthesia care costs for outpatient oncology surgery using time-driven activity-based costing. HEALTHCARE-THE JOURNAL OF DELIVERY SCIENCE AND INNOVATION 2015; 4:173-80. [PMID: 27637823 DOI: 10.1016/j.hjdsi.2015.08.007] [Citation(s) in RCA: 26] [Impact Index Per Article: 2.9] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Grants] [Track Full Text] [Subscribe] [Scholar Register] [Received: 02/25/2015] [Revised: 07/31/2015] [Accepted: 08/24/2015] [Indexed: 11/18/2022]
Abstract
BACKGROUND With the movement towards bundled payments, stakeholders should know the true cost of the care they deliver. Time-driven activity-based costing (TDABC) can be used to estimate costs for each episode of care. In this analysis, TDABC is used to both estimate the costs of anesthesia care and identify the primary drivers of those costs of 11 common oncologic outpatient surgical procedures. METHODS Personnel cost were calculated by determining the hourly cost of each provider and the associated process time of the 11 surgical procedures. Using the anesthesia record, drugs, supplies and equipment costs were identified and calculated. The current staffing model was used to determine baseline personnel costs for each procedure. Using the costs identified through TDABC analysis, the effect of different staffing ratios on anesthesia costs could be predicted. RESULTS Costs for each of the procedures were determined. Process time and costs are linearly related. Personnel represented 79% of overall cost while drugs, supplies and equipment represented the remaining 21%. Changing staffing ratios shows potential savings between 13% and 28% across the 11 procedures. CONCLUSIONS TDABC can be used to estimate the costs of anesthesia care. This costing information is critical to assessing the anesthesiology component in a bundled payment. It can also be used to identify areas of cost savings and model costs of anesthesia care. CRNA to anesthesiologist staffing ratios profoundly influence the cost of care. This methodology could be applied to other medical specialties to help determine costs in the setting of bundled payments.
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Affiliation(s)
- Katy E French
- The University of Texas M. D. Anderson Cancer Center, USA.
| | - Alexis B Guzman
- Institute for Cancer Care Innovation, The University of Texas M. D. Anderson Cancer Center, USA
| | - Augustin C Rubio
- Division of Anesthesiology & Critical Care, The University of Texas M. D. Anderson Cancer Center, USA
| | - John C Frenzel
- The University of Texas M. D. Anderson Cancer Center, USA
| | - Thomas W Feeley
- The University of Texas M. D. Anderson Cancer Center, USA; Harvard Business School, USA
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Erhun F, Mistry B, Platchek T, Milstein A, Narayanan VG, Kaplan RS. Time-driven activity-based costing of multivessel coronary artery bypass grafting across national boundaries to identify improvement opportunities: study protocol. BMJ Open 2015; 5:e008765. [PMID: 26307621 PMCID: PMC4550711 DOI: 10.1136/bmjopen-2015-008765] [Citation(s) in RCA: 18] [Impact Index Per Article: 2.0] [Reference Citation Analysis] [Abstract] [Key Words] [MESH Headings] [Track Full Text] [Download PDF] [Figures] [Journal Information] [Submit a Manuscript] [Subscribe] [Scholar Register] [Indexed: 12/14/2022] Open
Abstract
INTRODUCTION Coronary artery bypass graft (CABG) surgery is a well-established, commonly performed treatment for coronary artery disease--a disease that affects over 10% of US adults and is a major cause of morbidity and mortality. In 2005, the mean cost for a CABG procedure among Medicare beneficiaries in the USA was $32, 201 ± $23,059. The same operation reportedly costs less than $2000 to produce in India. The goals of the proposed study are to (1) identify the difference in the costs incurred to perform CABG surgery by three Joint Commission accredited hospitals with reputations for high quality and efficiency and (2) characterise the opportunity to reduce the cost of performing CABG surgery. METHODS AND ANALYSIS We use time-driven activity-based costing (TDABC) to quantify the hospitals' costs of producing elective, multivessel CABG. TDABC estimates the costs of a given clinical service by combining information about the process of patient care delivery (specifically, the time and quantity of labour and non-labour resources utilised to perform each activity) with the unit cost of each resource used to provide the care. Resource utilisation was estimated by constructing CABG process maps for each site based on observation of care and staff interviews. Unit costs were calculated as a capacity cost rate, measured as a $/min, for each resource consumed in CABG production. Multiplying together the unit costs and resource quantities and summing across all resources used will produce the average cost of CABG production at each site. We will conclude by conducting a variance analysis of labour costs to reveal opportunities to bend the cost curve for CABG production in the USA. ETHICS AND DISSEMINATION All our methods were exempted from review by the Stanford Institutional Review Board. Results will be published in peer-reviewed journals and presented at scientific meetings.
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Affiliation(s)
- F Erhun
- Clinical Excellence Research Center, Stanford University, Stanford, California, USA
| | - B Mistry
- Harvard Business School, Boston, Massachusetts, USA
| | - T Platchek
- Clinical Excellence Research Center, Stanford University, Stanford, California, USA
| | - A Milstein
- Clinical Excellence Research Center, Stanford University, Stanford, California, USA
| | | | - R S Kaplan
- Harvard Business School, Boston, Massachusetts, USA
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