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

Measurement of Cost of Boarding in the Emergency Department Using Time-Driven Activity-Based Costing

STUDY OBJECTIVE

Boarding admitted patients in emergency departments (EDs) is a national crisis that is worsening despite potential financial disadvantages. The objective of this study was to assess costs associated with boarding.

METHODS

We conducted a prospective, observational investigation of patients admitted through an ED for management of acute stroke at a large, urban, academic, comprehensive stroke center hospital. We employed time-driven activity-based costing methodology to estimate cost for patient care activities during admission and aggregated results to estimate the total cost of boarding versus inpatient care. Primary outcomes were total daily costs per patient for medical-surgical (med/surg) boarding, med/surg inpatient care, ICU boarding, and ICU inpatient care.

RESULTS

The total daily cost per patient with acute stroke was US$1856, for med/surg boarding versus US$993 for med/surg inpatient care and US$2267, for ICU boarding versus US$2165, for ICU inpatient care. These differences were even greater when accounting for costs associated with traveler nurses. ED nurses spent 293 min/d (mean) caring for each med/surg boarder; inpatient nurses spent 313 min/d for each med/surg inpatient. ED nurses spent 419 min/d caring for each ICU boarder; inpatient nurses spent 787 min/d for each ICU inpatient. Neurology attendings and residents spent 25 and 52 min/d caring for each med/surg boarder versus 62 minutes and 90 minutes for each med/surg inpatient, respectively.

CONCLUSION

Using advanced cost-accounting methods, our investigation provides novel evidence that boarding of admitted patients is financially costly, adding greater urgency for elimination of this practice.

Episode-of-care costs of total knee arthroplasty: Outpatient versus inpatient postoperative care protocol

BACKGROUND

Total knee arthroplasty (TKA) is the most commonly performed joint replacement procedure in North America. Few studies have successfully evaluated the episode-of-care cost (EOCC) of common elective orthopedic procedures using an activity-based costing (ABC) framework. The objective of this study is to compare the EOCC of same-day discharge versus inpatient TKA using an activity-based costing methodology.

METHODS

An observational case-control study was conducted comparing the EOCC of 25 consecutive patients who underwent same-day discharge (SDD) TKA and 25 consecutive patients who underwent same-day admission (SDA) TKA at an academic center. The EOCC was generated using an ABC framework.

RESULTS

The median total EOCC for outpatient TKA was $7,243.26 CAD (IQR=614.12), while the median EOCC in the inpatient group was $8,303.94 CAD (IQR=1,157.77). The costs incurred secondary to the hospital admission were the main driver of the increased cost for inpatients. The mean length of stay for admitted patients was 2.45 days (SD=1,52). Patients in the outpatient group were younger (p < 0.01) and had a lower mean Charlson Comorbidity Index group (p = 0.01). There was no significant difference in gender, BMI, ASA scores, and complication rates between the two groups.

CONCLUSION

Through the application of an ABC framework, this value-based healthcare study demonstrates that outpatient procedures are a cost-effective approach to knee arthroplasty. Our findings demonstrate that the total cost of outpatient TKA was on average 15% ($1,060 CAD) lower than the cost of TKA with the standard inpatient postoperative care protocol.

Direct Variable Cost Comparison of Endoscopic Versus Open Carpal Tunnel Release: A Time-Driven Activity-Based Costing Analysis

INTRODUCTION

To improve the delivery of value-based health care, a deeper understanding of the cost drivers in hand surgery is warranted. Time-driven activity-based costing (TDABC) offers a more accurate estimation of resource utilization compared with top-down accounting methods. This study used TDABC to compare the facility costs of open carpal tunnel release (OCTR) and endoscopic carpal tunnel release (ECTR).

METHODS

We identified 845 consecutive, unilateral carpal tunnel release (516 open, 329 endoscopic) surgeries performed at an orthopaedic specialty hospital between 2015 and 2021. Itemized facility costs were calculated using a TDABC algorithm. Patient demographics, comorbidities, surgical characteristics, and itemized costs were compared between OCTR and ECTR. Multivariate regression was used to determine the independent effect of endoscopic surgery on true facility costs.

RESULTS

Total facility costs were $352 higher in ECTR compared with OCTR ($882 versus $530). ECTR cases had higher personnel costs ($499 versus $420), likely because of longer surgical time (15 versus 11 minutes) and total operating room time (35 versus 27 minutes). ECTR cases also had higher supply costs ($383 versus $110). Controlling for demographics and comorbidities, ECTR was associated with an increase in personnel costs of $35.74 (95% CI, $26.32 to $45.15), supply costs of $230.28 (95% CI, $205.17 to $255.39), and total facility costs of $265.99 (95% CI, $237.01 to $294.97) per case.

DISCUSSION

Using TDABC, ECTR was 66% more costly to the facility compared with OCTR. To reduce the costs related to endoscopic surgery, efforts to decrease surgical time and negotiate lower ECTR-specific supply costs are warranted.

LEVEL OF EVIDENCE

Economic and Decision Analysis Level II.

Cost of hemophilia A in Brazil: a microcosting study

BACKGROUND

Patients with Hemophilia are continually monitored at treatment centers to avoid and control bleeding episodes. This study estimated the direct and indirect costs per patient with hemophilia A in Brazil and evaluated the cost variability across different age groups.

METHODS

A prospective observational research was conducted with retrospective data collection of patients assisted at three referral blood centers in Brazil. Time-driven Activity-based Costing method was used to analyze direct costs, while indirect costs were estimated based on interviews with family and caregivers. Cost per patient was analyzed according to age categories, stratified into 3 groups (0-11;12-18 or older than 19 years old). The non-parametric Mann-Whitney test was used to confirm the differences in costs across groups.

RESULTS

Data from 140 hemophilia A patients were analyzed; 53 were 0-11 years, 29 were 12-18 years, and the remaining were older than 19 years. The median cost per patient per year was R$450,831 (IQR R$219,842; R$785,149; $174,566), being possible to confirm age as a cost driver: older patients had higher costs than younger's (p = 0.001; median cost: 0-11 yrs R$299,320; 12-18 yrs R$521,936; ≥19 yrs R$718,969).

CONCLUSION

This study is innovative in providing cost information for hemophilia A using a microcosting technique. The variation in costs across patient age groups can sustain more accurate health policies driven to increase access to cutting-edge technologies and reduce the burden of the disease.

Health System Perspective on Cost for Delivering a Decision Aid for Prostate Cancer Using Time-driven Activity-based Costing

BACKGROUND

Previsit decision aids (DAs) have promising outcomes in improving decisional quality, however, the cost to deploy a DA is not well defined, presenting a possible barrier to health system adoption.

OBJECTIVES

We aimed to define the cost from a health system perspective of delivery of a DA.

RESEARCH DESIGN

Observational cohort.

PATIENTS AND METHODS

We interviewed or observed relevant personnel at 3 institutions with implemented DA distribution programs targeting men with prostate cancer. We then created process maps for DA delivery based on interview data. Cost determination was performed utilizing time-driven activity-based costing. Clinic visit length was measured on a subset of patients. Decisional quality measures were collected after the clinic visit.

RESULTS

Total process time (minutes) for DA delivery was 10.14 (UCLA), 68 (Olive View-UCLA), and 25 (Vanderbilt). Total average costs (USD) per patient were $38.32 (UCLA), $59.96 (Olive View-UCLA), and $42.38 (Vanderbilt), respectively. Labor costs were the largest contributors to the cost of DA delivery. Variance analyses confirmed the cost efficiency of electronic health record (EHR) integration. We noted a shortening of clinic visit length when the DA was used, with high levels of decision quality.

CONCLUSIONS

Time-driven activity-based costing is an effective approach to determining true inclusive costs of service delivery while also elucidating opportunities for cost containment. The absolute cost of delivering a DA to men with prostate cancer in various settings is much lower than the system costs of the treatments they consider. EHR integration streamlines DA delivery efficiency and results in substantial cost savings.

Measuring Interprofessional Collaboration's Impact on Healthcare Services Using the Quadruple Aim Framework: A Protocol Paper

Despite decades of research on the impact of interprofessional collaboration (IPC), we still lack definitive proof that team-based care can lead to a tangible effect on healthcare outcomes. Without return on investment (ROI) evidence, healthcare leaders cannot justifiably throw their weight behind IPC, and the institutional push for healthcare manpower reforms crucial for facilitating IPC will remain variable and fragmentary. The lack of proof for the ROI of IPC is likely due to a lack of a unifying conceptual framework and the over-reliance on the single-method study design. To address the gaps, this paper describes a protocol which uses as a framework the Quadruple Aim which examines the ROI of IPC using four dimensions: patient outcomes, patient experience, provider well-being, and cost of care. A multimethod approach is proposed whereby patient outcomes are measured using quantitative methods, and patient experience and provider well-being are assessed using qualitative methods. Healthcare costs will be calculated using the time-driven activity-based costing methodology. The study is set in a Singapore-based national and regional center that takes care of patients with neurological issues.

Cost standard set program: moving forward to standardization of cost assessment based on clinical condition

This communication piece is reporting the launching of the International Cost Standard set program, aiming to introduce standardized frameworks to measure costs for specific clinical conditions worldwide. A scientific committee including 16 international healthcare cost assessment experts from several countries, and International Consortium for Health Outcomes Measurement was formed to introduce the program. The committee got together in Lisbon for a first scientific meeting, followed by an international conference where time-driven activity-based costing applied studies were shared with the community. The cost standard set program start to offer instruments for people to measure with real-world data, the financial impact of having access to health technologies, improving the ability to evaluate inequity. Those advances might represent a paradigm shift in our ability to generate cost information on an individual level.

Time-Driven, Activity-Based Costing to Reduce Interventional Radiology Suite Idle Time

Background With the ever-increasing complexity of today's healthcare environment, it is evident that there is a higher demand to deliver high-quality, accessible, efficient, and affordable healthcare. At the same time, these changes are accompanied by decreasing rates of reimbursement. This can be attributed to the shift from fee-for-service to value-based payment methods in the industry. The reception of such changes in the appropriate manner is crucial to improvement and the much-demanded reform in our healthcare system. To adapt to this changing landscape, hospitals and healthcare systems must incorporate proper measures to identify extraneous spending, control costs, and streamline patient care. Our goal in this study was to use the time-driven, activity-based costing (TDABC) model to quantify the costs at every step as an inpatient goes through the care process in an interventional radiology department. Methodology After identification and mapping of all the steps involved from interventional radiology (IR) consult placement to patient transport to the postoperative recovery area, time data were collected for each step of the process. One of the steps was then selected for intervention. Our focus was on the time interval between one patient leaving after a completed procedure and the next scheduled patient entering the IR suite (heretofore referred to as idle time). To decrease the idle room time between patients, the interventional radiologists, IR administrations, nurse manager, transportation manager, and charge nurse first met as a group to set a realistic initial goal. Pre-intervention data were collected. Results After the collection of pre-intervention data, the average idle time of the IR suite was found to be 40 minutes. After a multidisciplinary discussion, our goal was to reduce this time to 25 minutes. Post-intervention data found the average time decreased to 24 minutes. Calculation of average costs per unit time for staff, IR room, and equipment yielded an approximate cost of $57 per minute of time in the IR suite. Conclusions Considering the near 40% decrease in suite idle time as well as the cost per minute of material, equipment, and staff (at ~80% capacity), this study proves that the TDABC system is a viable method of targeting bottlenecks in operations and streamlining patient care by reducing costs while optimizing the process patients go through during care continuum.

Frameworks for value-based care in the nonoperating room setting

PURPOSE OF REVIEW

Nonoperating room anesthesia (NORA) presents a unique opportunity for the application of value-based care (VBC) principles to procedures performed in the office-based and nonoperating room inpatient settings. The purpose of this article is to review how value is defined in NORA and enabling principles by which anesthesiologists can maximize value in NORA.

RECENT FINDINGS

In order to drive value, NORA providers can target improvements in clinical outcomes where NORA lags behind operating room-based anesthesia (death, over-sedation, nerve injury), implement protocols focusing on intermediate outcomes/quality (postoperative nausea and vomiting, pain control, hypothermia, delirium), incorporate patient-reported outcomes (PROs) to assess the trajectory of a patient's perioperative care, and reduce costs (direct and indirect) through operational and supply-based efficiencies. Establishing a culture of patient and provider safety first, appropriate patient selection with targeted, perioperative optimization of comorbidities, and efficient deployment of staff, space, and resources are critical enablers for success.

SUMMARY

Value in NORA can be defined as clinical outcomes, quality, patient-reported outcomes, and efficiency divided by the direct and indirect costs for achieving those outcomes. We present a novel framework adapting current VBC practices in operating room anesthesia to the NORA environment.

Surgical time and outcomes of stemmed versus stemless total shoulder arthroplasty

BACKGROUND

Stemless total shoulder arthroplasty (TSA) was approved for use in the United States in 2015, and there remains a paucity of data on its performance in this market. Decreased operative time without compromise of clinical outcomes is a theoretical advantage of stemless TSA, but no studies have evaluated this in a comparative study to date. Herein, the operative times and clinical outcomes of stemless vs. conventional stemmed TSA are investigated.

METHODS

This is a retrospective cohort study, evaluating all consecutive TSAs performed by a single surgeon between 2015 and 2018. Data were collected from 59 patients who underwent TSA with conventional, stemmed humeral implants and 115 patients in whom a stemless humeral implant was used. Operative times and demographic data were collected retrospectively from the anesthesia record, and prospectively collected patient-reported outcome measures were collected from the Surgical Outcomes System database. For patient-reported outcome measure, visual analog scale, American Shoulder and Elbow Surgeons, and Single Assessment Numerical Evaluation scores were recorded serially until a minimum 2-year follow-up.

RESULTS

The average operative time was 24 minutes less in the stemless cohort compared with the stemmed cohort (104 minutes vs. 128 minutes, P < .001). Cost analysis showed a decreased personnel cost of 15.9% that correlates to a 3.1% overall reduction in operating room-associated cost. Patient-reported outcome scores significantly improved postoperatively in both cohorts across all time points. There was no difference found in visual analog scale, American Shoulder and Elbow Surgeons, and Single Assessment Numerical Evaluation scores between the cohorts at the 2-year follow-up.

CONCLUSIONS

Stemless TSA significantly reduces operative time with equivalent functional outcomes at a minimum 2-year follow-up.

Process, resource and success factors associated with chimeric antigen receptor T-cell therapy for multiple myeloma

Background: Chimeric antigen receptor T-cell (CAR-T) therapy represents a new frontier in multiple myeloma. It is important to understand critical success factors (CSFs) that may optimize its use in this therapeutic area. Methods: We estimated the CAR-T process using time-driven activity-based costing. Information was obtained through interviews at four US oncology centers and with payer representatives, and through publicly available data. Results: The CAR-T process comprises 13 steps which take 177 days; it was estimated to include 46 professionals and ten care settings. CSFs included proactive collaboration, streamlined reimbursement and CAR-T administration in alternative settings when possible. Implementing CSFs may reduce episode time and costs by 14.4 and 13.2%, respectively. Conclusion: Our research provides a blueprint for improving efficiencies in CAR-T therapy, thereby increasing its sustainability for multiple myeloma.

A Mobile App for the Precise Measurement of Healthcare Provider Activity Times to Support Time-Driven Activity Based Costing Studies

The duration of activities performed by healthcare providers are pivotal to Time-Driven Activity-Based Costing (TDABC) models. This study examines the use of a smartphone mobile application technology to record activity times. This study validates the accuracy of activity times recorded on a smartphone mobile application, dTool, compared to observed length of time recordings in the operating room. For analysis, we performed two one-sided tests for the measurements "Case Start" and "Case End". Equivalence bounds were specified in terms of raw mean difference of 1 min (upper) and -1 min (lower). The total number of comparisons in the observer protocol was 72 (32 "case start" patient comparisons and 40 "case end" patient comparisons measured over 45 individual OR cases). Given equivalence bounds of -1.000 and 1.000 (on a raw scale) and an alpha of 0.05, both equivalence tests were significant: provider and third-party observer protocol presented t(40) = 3.228 and p = < 0.001; observer timing protocol presented t(68.68) = 56.762, p = < 0.001. Conclusions: With this novel smartphone technology, a healthcare provider can reliably self-record activity LoT using dTool while providing patient care. Future TDABC studies incorporating this technology will reduce the potential operational barriers to implementation.

The implementation of value-based healthcare: a scoping review

Background

The aim of this study was to identify and summarize how value-based healthcare (VBHC) is conceptualized in the literature and implemented in hospitals. Furthermore, an overview was created of the effects of both the implementation of VBHC and the implementation strategies used.

Methods

A scoping review was conducted by searching online databases for articles published between January 2006 and February 2021. Empirical as well as non-empirical articles were included.

Results

1729 publications were screened and 62 were used for data extraction. The majority of the articles did not specify a conceptualization of VBHC, but only conceptualized the goals of VBHC or the concept of value. Most hospitals implemented only one or two components of VBHC, mainly the measurement of outcomes and costs or Integrated Practice Units (IPUs). Few studies examined effects. Implementation strategies were described rarely, and were evaluated even less.

Conclusions

VBHC has a high level of interpretative variability and a common conceptualization of VBHC is therefore urgently needed. VBHC was proposed as a shift in healthcare management entailing six reinforcing steps, but hospitals have not implemented VBHC as an integrative strategy. VBHC implementation and effectiveness could benefit from the interdisciplinary collaboration between healthcare and management science.

Trial registration

This scoping review was registered on Open Science Framework https://osf.io/jt4u7/ (OSF | The implementation of Value-Based Healthcare: a Scoping Review). 

Supplementary Information

The online version contains supplementary material available at 10.1186/s12913-022-07489-2.

Understanding the Economic Impact of an Essential Service: Applying Time-Driven Activity-Based Costing to the Hospital Airway Response Team

BACKGROUND

As the United States moves toward value-based care metrics, it will become essential for anesthesia groups nationwide to understand the costs of their services. Time-driven activity-based costing (TDABC) estimates the amount of time it takes to perform a clinical activity by dividing complex tasks into process steps and mapping each step and has historically been used to estimate the costs of various health care services. TDABC is a tool that can be adapted for variable staffing models and the volume of service provided. Anesthesia departments often provide staffing for airway response teams (ART). The economic implications of staffing ART have not been well described. We present a TDABC model for ART activation in a tertiary-care center to estimate the cost incurred by an anesthesiology department to staff an ART.

METHODS

Pages received by the Brigham and Women's Hospital ART over a 24-month time period (January 2019 to December 2020) were analyzed and categorized. The local administrative database was queried for the Current Procedural Terminology (CPT) code used to bill for emergency airway placements. Sessions were held by multiple members of the ART to create process maps for the different types of ART activations. We estimated the staffing costs using the estimated time it took for each type of ART activation as well as the data collected for local ART activations.

RESULTS

From the paging records, we analyzed 3368 activations of the ART. During the study period, 1044 airways were billed for with emergency airway CPT code. The average revenue collected per airway was $198.45 (95% CI, $190-$207). For STAT/Emergency airway team activations, process maps and non-STAT airway team activations were created, and third subprocess map was created for performing endotracheal intubation. Using the TDABC, the total staffing costs are estimated to be $218,601 for the 2-year study period. The ART generated $207,181 in revenue during the study period.

CONCLUSIONS

Our analysis of ART-activation pages suggests that while the revenue generated may cover the cost of staffing the team during ART activations, it does not cover consumable equipment costs. Additionally, the current fee-for-service model relies on the team being able to perform other clinical duties in addition to covering the airway pager and would be impossible to capture using traditional top-down costing methods. By using TDABC, anesthesia groups can demonstrate how certain services, such as ART, are not fully covered by current reimbursement models and how to negotiate for subsidy agreements.As the transition from traditional fee-for-service payments to value-based care models continues in the United States, improving the understanding and communication of medical care costs will be essential. In the United States, it is common for anesthesia groups to receive direct revenue from hospitals to preserve financial viability, and therefore, knowledge of true cost is essential regardless of payer model.1 With traditional payment models, what is billable and nonbillable may not reflect either the need for or the cost of providing the service. As anesthesia departments navigate the transition of care from volume to value, actual costs will be essential to understand for negotiations with hospitals for support when services are nonbillable, when revenue from payers does not cover anesthesia costs, and when calculating the appropriate share for anesthesia departments when bundled payments are distributed.

Value in acute care surgery, Part 1: Methods of quantifying cost

BACKGROUND

With health care expenditures continuing to increase rapidly, the need to understand and provide value has become more important than ever. In order to determine the value of care, the ability to accurately measure cost is essential. The acute care surgeon leader is an integral part of driving improvement by engaging in value increasing discussions. Different approaches to quantifying cost exist depending on the purpose of the analysis and available resources. Cost analysis methods range from detailed microcosting and time-driven activity-based costing to less complex gross and expenditure-based approaches. An overview of these methods and a practical approach to costing based on the needs of the acute care surgeon leader is presented.

Cost Savings of Carpal Tunnel Release Performed In-Clinic Compared to an Ambulatory Surgery Center: Time-Driven Activity-Based-Costing

Purpose: The purpose of our study was to investigate carpal tunnel release (CTR) performed in the clinic versus the ambulatory surgery center (ASC) to evaluate for potential cost savings. Methods: Patients who underwent either CTR in clinic under a local anesthetic or CTR in the ASC with sedation and local anesthetic were prospectively enrolled in a registry between 2014 and 2016. All patients completed a Visual Analog Scale (VAS) pain scale for procedural and postprocedure pain. Time-Driven Activity-Based Costing (TDABC) was utilized to quantify cost of both CTR in clinic and CTR in the ASC. Statistical analysis involved parametric comparative tests between patient cohorts for both the TDABC-cost and patient pain. Results: A total of 59 participants completed the postprocedure CTR survey during the study period, 23 (38.9%) in the ASC group and 36 (61.1%) in the clinic group. Overall time for the procedure from patient arrival to discharge was significantly longer for the ASC cases, averaging 215.7 minutes (range: 201-230) compared to 78.6 minutes (range: 59-98) in the clinic group (P < .01). Both procedural and postoperative VAS pain scores were comparable between clinic and ASC cohorts, procedural pain: 1.8 vs 1.9 (P = .91) and postoperative pain: 4.8 vs 4.9 (P = .88). TDABC analysis estimated ASC CTR procedures to cost an average of $557.07 ($522.06-$592.08) and clinic procedures to cost an average of $151.92 ($142.59-$161.25) (P < .05). Conclusions: CTR in the clinic setting results in significant cost savings compared to CTR in the ASC with no difference in pain scores during the procedure or postoperative period. Level of Evidence: Therapeutic Level II.

Utilizing Lean Methodology and Time-Driven Activity-Based Costing Together: An Observational Pilot Study of Hip Replacement Surgery Utilizing a New Method to Study Value-Based Health Care

BACKGROUND

Time-driven activity-based costing (TDABC) has been suggested as the cost-accounting arm of value-based care organizations seeking to address costing challenges from the bottom up by studying the actual processes used in patient care. Lean methodology is a system in which the care pathway is understood at a granular level. In the current study, we attempt to combine these 2 methodologies, providing a robust mechanism to detect meaningful variation. First, we used data from a single surgeon and examined differences in time and cost for patients released on postoperative days 1 or 2. Next, we compared the data from patients discharged on postoperative day 1 with those of patients who underwent an operation by a different surgeon and were also discharged on postoperative day 1.

METHODS

Consecutive patients who underwent an anterior hip arthroplasty performed by 1 of 2 surgeons and who had degenerative pathology of the hip, an inpatient stay of 1 or 2 days, discharge to home, and no readmission within 30 days of the surgical procedure were identified. We obtained data on patient demographic characteristics and time spent on activities for each personnel role in 15-minute increments occurring during 4 time points of a surgical episode of care (preoperative bay, surgical procedure, post-anesthesia care unit, and inpatient). Personnel costs were set as a ratio relative to the cost of a registered nurse (RN).

RESULTS

Consistent with our hypotheses, both RNs and nursing assistants-certified (NA-Cs) spent more time with patients released on postoperative day 2 compared with those released on postoperative day 1. Also consistent with our hypotheses, we only found significant differences for the time that personnel spent in the surgical procedures.

CONCLUSIONS

For patients undergoing total hip arthroplasty for degenerative conditions, we demonstrate that, in the setting of lean methodology, TDABC can detect variability in a meaningful and predictable way. This combination may further enable clinicians and administrators to improve processes, to allocate appropriate resources to specific process steps, and to optimize various treatments across episodes of care.

LEVEL OF EVIDENCE

Economic and Decision Analysis Level IV. See Instructions for Authors for a complete description of levels of evidence.

Variation of Daily Care Demand in Swiss General Hospitals: Longitudinal Study on Capacity Utilization, Patient Turnover and Clinical Complexity Levels

Background

Variations in hospitals’ care demand relies not only on the patient volume but also on the disease severity. Understanding both daily severity and patient volume in hospitals could help to identify hospital pressure zones to improve hospital-capacity planning and policy-making.

Objective

This longitudinal study explored daily care demand dynamics in Swiss general hospitals for 3 measures: (1) capacity utilization, (2) patient turnover, and (3) patient clinical complexity level.

Methods

A retrospective population-based analysis was conducted with 1 year of routine data of 1.2 million inpatients from 102 Swiss general hospitals. Capacity utilization was measured as a percentage of the daily maximum number of inpatients. Patient turnover was measured as a percentage of the daily sum of admissions and discharges per hospital. Patient clinical complexity level was measured as the average daily patient disease severity per hospital from the clinical complexity algorithm.

Results

There was a pronounced variability of care demand in Swiss general hospitals. Among hospitals, the average daily capacity utilization ranged from 57.8% (95% CI 57.3-58.4) to 87.7% (95% CI 87.3-88.0), patient turnover ranged from 22.5% (95% CI 22.1-22.8) to 34.5% (95% CI 34.3-34.7), and the mean patient clinical complexity level ranged from 1.26 (95% CI 1.25-1.27) to 2.06 (95% CI 2.05-2.07). Moreover, both within and between hospitals, all 3 measures varied distinctly between days of the year, between days of the week, between weekdays and weekends, and between seasons.

Conclusions

While admissions and discharges drive capacity utilization and patient turnover variation, disease severity of each patient drives patient clinical complexity level. Monitoring—and, if possible, anticipating—daily care demand fluctuations is key to managing hospital pressure zones. This study provides a pathway for identifying patients’ daily exposure to strained hospital systems for a time-varying causal model.

A primer on time-driven activity-based costing in brachytherapy

Emphasis on value-based healthcare has led to increasing use of time-driven activity-based costing (TDABC) across medical departments. When applied to brachytherapy, TDABC provides insight into differences in costs across various modes of therapy, the nuances that drive cost including institutional factors and involved personnel, and discrepancies in reimbursement which influence clinical practice. This is especially important with the new alternative payment model (APM) in radiation oncology which offers fixed reimbursement per 90-day episode of care. The TDABC model can thus be utilized to improve efficiency, optimize the role of ancillary staff in treatment planning and care delivery, and implement shorter fraction schedules when clinically appropriate to promote value-based care. Ultimately, application of this methodology could potentiate changes to practice and incentives to improve patient care. In this review, we discuss the utility and limitations of TDABC in the context of existing studies in brachytherapy which have utilized this methodology.

Evaluating the Safety of the Hand Surgery Procedure Room: A Single-Center Cohort of 1,404 Surgical Encounters

PURPOSE

Performing hand surgeries in the procedure room (PR) setting instead of the operating room effectively reduces surgical costs. Understanding the safety or complication rates associated with the PR is important in determining the value of its use. Our purpose was to describe the incidence of medical and surgical complications among patients undergoing minor hand surgeries in the PR.

METHODS

We retrospectively reviewed all adult patients who underwent an operation in the PR setting between December 2013 and May 2019 at a single tertiary academic medical center by 1 of 5 fellowship-trained orthopedic hand surgeons. Baseline patient characteristics were described. Complication rates were obtained via chart review.

RESULTS

For 1,404 PR surgical encounters, 1,796 procedures were performed. Mean patient age was 59 ± 15 years, 809 were female (57.6%), and average follow-up was 104 days. The most common surgeries were carpal tunnel release (39.9%), trigger finger release (35.9%), and finger mass or cyst excision (9.6%). Most surgeries were performed using a nonpneumatic wrist tourniquet (58%), whereas 42% used no tourniquet. No patient experienced a major medical complication. No procedure was aborted owing to intolerance. No patient required admission. No intraoperative surgical or medical complications occurred. Observed complications included delayed capillary refill requiring phentolamine administration after a trigger thumb release performed using epinephrine without a tourniquet (n = 1; 0.1%), complex regional pain syndrome (n = 3; 0.2%), infection requiring surgical debridement (n = 2; 0.2%), and recurrent symptoms requiring reoperation (n = 8; 0.7%).

CONCLUSIONS

In this cohort of patients in whom surgery was performed in a PR, there were no major intraoperative surgical or medical complications. There was a low rate of postoperative infection, development of complex regional pain syndrome, and a low need for revision surgery. These observations do not support the concern for safety as a barrier to performing minor hand surgery in the PR setting.

TYPE OF STUDY/LEVEL OF EVIDENCE

Therapeutic IV.

The Cost of Care Associated with Microvascular Free Tissue Transfer by Anatomical Region: A Time-Driven Activity-Based Model

Background Microvascular free tissue transfer (FTT) is a reliable method for reconstruction of complex soft tissue defects. The goal of this study was to utilize time-driven activity-based cost (TDABC) accounting to measure the total cost of care of FTT and identify modifiable cost drivers.

Methods A retrospective review was performed on patients requiring FTT at a single, level-I academic trauma center from 2013 to 2019. Patient and surgical characteristics were collected, and six prospective FTT cases were observed via TDABC to collect direct and indirect costs of care.

Results When stratified by postoperative stay at intensive care units (ICUs), the average cost of care was $21,840.22, while cases without ICU stay averaged $6,646.61. The most costly category was ICU stay, averaging $8,310.99 (40.9% of nonstratified overall cost). Indirect costs were the second most costly category, averaging $4,388.07 (21.6% of nonstratified overall cost). Overall, 13 of 100 reviewed cases required some form of revision free-flap, increasing cumulative costs to $7,961.34 for cases with non-ICU stay and $22,233.85 for cases with ICU stay, averaging up to $44,074.07 for patients who stayed in the ICU for both procedures. An increase in cumulative cost was also observed within the timeframe of the investigation, with average costs of $8,484.00 in 2013 compared to $45,128 for 2019.

Conclusion Primary drivers for cost in this study were ICU stay and revision/reoperation. Better understanding the cost of FTT allows for cost reduction through the development of new protocols that drive intraoperative efficiency, reduce ICU stays, and optimize outcomes.

Time-Driven Activity-Based Costing for Cataract Surgery in Canada: The Case of the Kensington Eye Institute

Time-driven activity-based costing (TDABC) has received considerable attention globally as a way to measure value in healthcare systems. This study aimed to apply TDABC for cataract surgery at the Kensington Eye Institute (KEI). During a field evaluation, a detailed process map was created for cataract surgery at KEI. The amount of resource use in terms of providers, equipment, space and consumables was calculated to determine the total costs of care. The average patient journey lasted 76 minutes, with 13 minutes of the surgical procedure occurring in the operating room (OR). The average procedure's cost per case was $545.28, which included consumables (34.40%), space and equipment (23.702%), personnel (11.69%), overhead (30.27%) and OR (57%). KEI cataract operation was at approximately 50% capacity due to funding limits. The TDABC process map and costing allow centres to have data-driven support tools for care redesign and optimization.

Time-Driven Activity-Based Costing in Interventional Oncology: Cost Measurement and Cost Variability for Hepatocellular Carcinoma Therapies

PURPOSE

To use time-drive activity-based costing (TDABC) to characterize and compare costs of transarterial chemoembolization (TACE), transarterial radioembolization (TARE), and ablation.

METHODS

This three-part study involved (1) prospective observation to record resources used during TACE, TARE, and ablation and statistical evaluation of interobserver and interprocedure variability; (2) Bland-Altman analysis of prospective measurements and medical record time stamps to establish practicality of using retrospective data in place of direct observation; (3) retrospective time stamp assessment for 117 ablations, 61 TACE procedures, and 61 TARE procedures to reveal variability drivers.

RESULTS

Ablation costs were lowest ($3,744), which were 74% of TACE costs ($5,089) and 18% of TARE costs ($20,818). Consumables were the greatest cost contributor, accounting for 65% of ablation, 58% of TACE, and 90% of TARE costs. A single consumable contributed to most of the overall costs: the ablation probe (42%), ethiodized oil for TACE (30%), and yttrium-90 microspheres for TARE (80%). Bland-Altman analysis showed agreement between retrospective time stamps and prospective measurements. Ablation costs increased from $3,288 to $4,245 to $4,461 for one, two, or three tumors treated. TACE cost increased from $5,051 to $5,296 for lobar versus selective approaches.

CONCLUSION

A bottom-up costing approach using TDABC is feasible to assess true costs of hepatocellular carcinoma treatments and demonstrates ablation costs are significantly less than those of TACE and TARE. Replication of these methods at other institutions can facilitate development of a bundled payment model to promote utilization of locoregional therapies for hepatocellular carcinoma.

Comparison of the Costs of Reusable Versus Disposable Equipment for Endoscopic Carpal Tunnel Release Procedures Using Activity-Based Costing Analysis

PURPOSE

Guidelines for sterilization of reusable equipment (eg, arthroscopes, surgical equipment) have recently been established. These guidelines are supported by the U.S. Food and Drug Administration and affect costs for sterilization. The current analysis was undertaken to understand if reusable or disposable endoscopic carpal tunnel release (ECTR) equipment is a less-expensive option.

METHODS

An activity-based cost analysis was undertaken to determine the costs of reusable versus disposable equipment for ECTR. Costs of disposable equipment were obtained from manufacturers. Costs of processing reusable equipment including labor, time, cost of operating room time, and sterilization supplies and equipment were obtained from the literature and from recent reports identifying these costs. Infection rates and costs of infection were also factored in. Decision analysis software was used to determine the expected costs of each option (disposable vs reusable). A sensitivity analysis was undertaken on those variables that were determined to have the greatest effect on the overall costs of the procedure and sterilization.

RESULTS

Costs for each option when totaled were $917 for disposable and $1,019 for reusable equipment, resulting in cost savings of $102 with disposable equipment. Reusable equipment was the least costly option when the following costs/events occurred: cost of a disposable arthroscope, >$452; cost of disposable ECTR, >$647; costs of operating room time, <$28.63/min; set up time, <6.8 minutes for reusable equipment; and cost of disposable ECTR blade used with reusable equipment, <$160.

CONCLUSIONS

When considering the cost of operating room time, preparation, and processing of reusable equipment for ECTR, the disposable equipment for this procedure is less costly.

TYPE OF STUDY/LEVEL OF EVIDENCE

Economic Analysis II.

A standardized framework to evaluate the quality of studies using TDABC in healthcare: the TDABC in Healthcare Consortium Consensus Statement

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.

Timing of Transversus Abdominis Plane Block and Postoperative Pain Management

Background

Transversus abdominis plane (TAP) blocks using liposomal bupivacaine can reduce postoperative pain and opioid consumption after surgery. The impact of timing of administration of such blocks has not been determined.

Materials and Methods

A retrospective cohort study of all adult patients that underwent colorectal procedures between January 2013 and October 2015 and received TAP blocks with liposomal bupivacaine at our institution was conducted. The primary outcomes were postoperative pain scores and opioid consumption. Secondary outcomes included postoperative use of non-opioid analgesics as well as total hospital cost of admission and postoperative hospital length of stay.

Results

A total of 287 patients were identified and included in the analysis. A total of 71 patients received blocks prior to induction of general anesthesia (pre-ind), 85 patients received blocks after induction of general anesthesia but prior to surgical incision (post-ind) and 131 patients received blocks after completion of surgery (post-op). No significant differences were observed in the postoperative pain scores (either in the first 4 hours or for the entire duration of hospital stay) or opioid consumption between the pre-ind and the post-ind groups. More ketorolac was used in the post-op group compared to the pre-ind group (or= 3.36, 95% CI (1.08, 10.43); p=0.03).

Conclusion

Our findings suggest that there seems to be no difference if tap blocks with liposomal bupivacaine are performed before or after induction of anesthesia. Patient preference as well as operating room efficiency should be considered when deciding on the timing of these blocks.

Variability in hospital treatment costs: a time-driven activity-based costing approach for early-stage invasive breast cancer patients

OBJECTIVES

Using a standardised diagnostic and generic treatment path for breast cancer, and the molecular subtype perspective, we aim to measure the impact of several patient and disease characteristics on the overall treatment cost for patients. Additionally, we aim to generate insights into the drivers of cost variability within one medical domain.

DESIGN, SETTING AND PARTICIPANTS

We conducted a retrospective study at a breast clinic in Belgium. We used 14 anonymous patient files for conducting our analysis.

RESULTS

Significant cost variations within each molecular subtype and across molecular subtypes were found. For the luminal A classification, the cost differential amounts to roughly 166%, with the greatest treatment cost amounting to US$29 780 relative to US$11 208 for a patient requiring fewer medical activities. The major driver for these cost variations relates to disease characteristics. For the luminal B classification, a cost difference of roughly 242% exists due to both disease-related and patient-related factors. The average treatment cost for triple negative patients amounted to US$26 923, this is considered to be a more aggressive type of cancer. The overall cost for HER2-enriched is driven by the inclusion of Herceptin, thus this subtype is impacted by disease characteristics. Cost variability across molecular classifications is impacted by the severity of the disease, thus disease-related factors are the major drivers of cost.

CONCLUSIONS

Given the cost challenge in healthcare, the need for greater cost transparency has become imperative. Through our analysis, we generate initial insights into the drivers of cost variability for breast cancer. We found evidence that disease characteristics such as severity and more aggressive cancer forms such as HER2-enriched and triple negative have a significant impact on treatment cost across the different subtypes. Similarly, patient factors such as age and presence of gene mutation contribute to differences in treatment cost variability within molecular subtypes.

Advances in Value-Based Healthcare by the Application of Time-Driven Activity-Based Costing for Inpatient Management: A Systematic Review

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.

Economic Evaluation of a Telemedicine Service to expand Primary Health Care in Rio Grande do Sul: TeleOftalmo's microcosting analysis

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.

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)

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.

An 8-step framework for implementing time-driven activity-based costing in healthcare studies

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.

Forecasting Single Disease Cost of Cataract Based on Multivariable Regression Analysis and Backpropagation Neural Network

In medical services, charge according to the disease is an important way to promote the reform of pricing mechanism, control the unreasonable growth of medical expenses, as well as reduce the burden on patients. Single disease cost forecasting that both identify potential influencing or driving factors and enable better proactive estimation of costs can guide the management and control of medical costs. This study aimed to identify the factors that affect the medical costs of single disease cataract and compare 2 regression models for anticipating acceptable medical cost forecasts. For this purpose, 483 patients with cataract surgery completed in West China Hospital from May 1, 2015, to October 1, 2015, were selected from hospital information system. For cost forecasting, multivariable regression analysis (MRA) and backpropagation neural network (BPNN) were used. Analysis of data was performed with SPSS21.0 and MATLAB2014a software. Total medical costs of patients with cataract (n = 483) ranged from 2015.00 to 13 359.00 CNY, and the mean ± standard deviation is 6292.29 ± 2639.43 CNY. Factors influencing costs of cataract in the MRA include, in importance order, intraocular lens (IOL) implantation (|r|: 0.805, P < .01), doctor level (|r|: 0.644, P < .01), payment source (|r|: 0.554, P < .01), admission status (|r|: 0.326, P < .01), additional diagnosis (|r|: 0.260, P < .01), type of surgery (|r|: 0.127, P < .05), and type of anesthesia (|r|: 0.126, P < .05). In terms of forecasting performance, BPNN (average error: 2.81%) outperforms, yet is less interpretable than MRA (average error: 5.79%). Both MRA and BPNN are technically and economically feasible in generating medical costs of cataract. And some insights on using results of the forecasting model in controlling and reducing disease costs are obtained.