Time-Driven Activity-Based Costing in Breast Cancer Care Delivery.

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.

Developing a Value Framework: Utilizing Administrative Data to Assess an Enhanced Care Initiative.

BACKGROUND: There remains no tool to quantify the total value of comparative processes in health care. Hospital administrative data sets are emerging as valuable sources to evaluate performance. Thus, we use a framework to simultaneously assess multiple domains of value associated with an enhanced recovery initiative using national administrative data. MATERIALS AND METHODS: Risk-stratified clinical pathways for patients undergoing pancreatic surgery were implemented in 2016 at our institution. We used a national administrative database to characterize changes in value associated with this initiative. Value metrics assessed included in-hospital mortality, complication rates, length of stay (LOS), 30-day readmission rates, and institutional costs. We compared our performance with other hospitals both before and after implementation of the pathways. Metrics were graphed on radar charts to assess overall value. RESULTS: 22,660 cases were assessed. Comparing 75 cases at our institution and 5520 cases at all other hospitals before pathway implementation, mean in-hospital LOS was 9.6 versus 10.8 d, in-hospital mortality was 0.0% versus 1.9%, mean costs were $23,585 versus $21,387, 30-day readmission rates were 1.3% versus 7.4%, and complication rates were 8.0% versus 11.2%, respectively. Comparing 334 cases at our institution and 16,731 cases at all other hospitals after pathway implementation, mean in-hospital LOS was 7.7 versus 10.3 d, in-hospital mortality was 0.3% versus 1.6%, mean costs were $19,428 versus $22,032, 30-day readmission rates were 6.6% versus 7.5%, and complication rates were 6.3% versus 10.3%, respectively. Notably, LOS and institutional costs were reduced at our institution after implementation of the enhanced clinical care pathways. Our costs were higher than comparators before implementation, but lower than comparators after implementation. CONCLUSIONS: Herein, we used an analytic framework and used national administrative data to assess the value of an enhanced care initiative as benchmarked with data from other hospitals. We thus illustrate how to identify and measure opportunities for targeted improvements in health care delivery. We also recognize the limitations of the use of administrative data in a comprehensive assessment of value in health care.

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.

Using Time-Driven Activity-Based Costing to Model the Costs of Various Process-Improvement Strategies in Acute Pain Management.

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.

Value-Based Breast Cancer Care: A Multidisciplinary Approach for Defining Patient-Centered Outcomes.

PURPOSE: Value in healthcare-i.e., patient-centered outcomes achieved per healthcare dollar spent-can define quality and unify performance improvement goals with health outcomes of importance to patients across the entire cycle of care. We describe the process through which value-based measures for breast cancer patients and dynamic capture of these metrics via our new electronic health record (EHR) were developed at our institution. METHODS: Contemporary breast cancer literature on treatment options, expected outcomes, and potential complications was extensively reviewed. Patient perspective was obtained via focus groups. Multidisciplinary physician teams met to inform a 3-phase process of (1) concept development, (2) measure specification, and (3) implementation via EHR integration. RESULTS: Outcomes were divided into 3 tiers that reflect the entire cycle of care: (1) health status achieved, (2) process of recovery, and (3) sustainability of health. Within these tiers, 22 patient-centered outcomes were defined with inclusion/exclusion criteria and specifications for reporting. Patient data sources will include the Epic Systems EHR and validated patient-reported outcome questionnaires administered via our institution's patient portal. CONCLUSIONS: As healthcare costs continue to rise in the United States and around the world, a value-based approach with explicit, transparently reported patient outcomes will not only create opportunities for performance improvement but will also enable benchmarking across providers, healthcare systems, and even countries. Similar value-based breast cancer care frameworks are also being pursued internationally.

Improving the quality of cancer care in America.

Thomas Feeley is the Helen Shafer Fly Distinguished Professor of Anesthesiology, and the Head of the Institute for Cancer Care Innovation at the University of Texas MD Anderson Cancer Center (TX, USA), which he has led since its formation in 2008. He received his undergraduate degree and M.D. from Boston University (MA, USA) and trained in anesthesiology and critical care medicine at Harvard's Beth Israel Hospital in Boston. He was a faculty member at Stanford University (CA, USA) for 19 years prior to moving to The University of Texas MD Anderson Cancer Center in 1997 to lead the then newly created Division of Anesthesiology and Critical Care. Dr Feeley served on the Institute of Medicine's Committee on Improving the Quality of Cancer Care: Addressing the Challenges of an Aging Population that published its report in September of 2013. He was recently appointed by Texas Governor Rick Perry to the board of directors of the Texas Institute for Health Care Quality and Efficiency. In addition to his research and administrative roles, Dr Feeley provides patient care services in the delivery of anesthesia.

Using time-driven activity-based costing to identify value improvement opportunities in healthcare.

As healthcare providers cope with pricing pressures and increased accountability for performance, they should be rededicating themselves to improving the value they deliver to their patients: better outcomes and lower costs. Time-driven activity-based costing offers the potential for clinicians to redesign their care processes toward that end. This costing approach, however, is new to healthcare and has not yet been systematically implemented and evaluated. This article describes early time-driven activity-based costing work at several leading healthcare organizations in the United States and Europe. It identifies the opportunities they found to improve value for patients and demonstrates how this costing method can serve as the foundation for new bundled payment reimbursement approaches.

Epidural versus ON-Q local anesthetic-infiltrating catheter for post-thoracotomy pain control.

OBJECTIVE: The authors compared thoracic epidural with ON-Q infiltrating catheters in patients having open thoracotomy to determine whether one method better relieves postoperative pain and would allow earlier discharge from the hospital and, hence, cost savings. DESIGN: Retrospective chart review. SETTING: University hospital. PARTICIPANTS: Fifty adult patients (24 to 81 years old) undergoing open thoracotomy by one surgeon. INTERVENTIONS: One group had thoracic epidural catheters placed by an anesthesiologist and then managed by the acute pain service. The other group had intraoperative ON-Q (ON-Q; I-Flow; Lake Forest, California) infiltrating catheters placed by the surgeon, wound infiltration with a local anesthetic, plus patient-controlled analgesia with an intravenous opioid. MEASUREMENTS AND MAIN RESULTS: The authors measured and compared average daily pain rating, maximum pain rating, time to discharge from the hospital, and total bill for hospital stay. Patients who received epidural analgesia had lower average pain scores on day 2 than did patients in the ON-Q group. Patients in the ON-Q group reported higher maximum pain scores on days 1 and 2 and at the time of discharge. Patients in the ON-Q group were discharged an average of 1 day earlier; hence, their average total bill was lower. CONCLUSIONS: Even though the maximum pain score was higher in the ON-Q group, patients were comfortable enough to be discharged earlier, resulting in cost savings. ON-Q infiltrating catheters present a good option for providing postoperative analgesia to patients having an open thoracotomy.

Ensuring quality cancer care: a follow-up review of the Institute of Medicine's 10 recommendations for improving the quality of cancer care in America.

Responding to growing concerns regarding the safety, quality, and efficacy of cancer care in the United States, the Institute of Medicine (IOM) of the National Academy of Sciences commissioned a comprehensive review of cancer care delivery in the US health care system in the late 1990s. The National Cancer Policy Board (NCPB), a 20-member board with broad representation, performed this review. In its review, the NCPB focused on the state of cancer care delivery at that time, its shortcomings, and ways to measure and improve the quality of cancer care. The NCPB described an ideal cancer care system in which patients would have equitable access to coordinated, guideline-based care and novel therapies throughout the course of their disease. In 1999, the IOM published the results of this review in its influential report, Ensuring Quality Cancer Care. The report outlined 10 recommendations, which, when implemented, would: 1) improve the quality of cancer care, 2) increase the current understanding of quality cancer care, and 3) reduce or eliminate access barriers to quality cancer care. Despite the fervor generated by this report, there are lingering doubts regarding the safety and quality of cancer care in the United States today. Increased awareness of medical errors and barriers to quality care, coupled with escalating health care costs, has prompted national efforts to reform the health care system. These efforts by health care providers and policymakers should bridge the gap between the ideal state described in Ensuring Quality Cancer Care and the current state of cancer care in the United States.

Improving efficiency and reducing costs of MRI-Guided prostate brachytherapy using Time-Driven Activity-Based costing.

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.

Determining Variable Costs in the Acute Urolithiasis Cycle of Care Through Time-Driven Activity-Based Costing.

OBJECTIVE: To characterize full cycle of care costs for managing an acute ureteral stone using time-driven activity-based costing. METHODS: We defined all phases of care for patients presenting with an acute ureteral stone and built an overarching process map. Maps for sub-processes were constructed through interviews with providers and direct observation of clinical spaces. This facilitated calculation of cost per minute for all aspects of care delivery, which were multiplied by associated process times. These were added to consumable costs to determine cost for each specific step and later aggregated to determine total cost for each sub-process. We compared costs of eight common clinical pathways for acute stone management, defining total cycle of care cost as the sum of all sub-processes that comprised each pathway. RESULTS: Cost per sub-process included $920 for emergency department (ED) care, $1665 for operative stent placement, $2368 for percutaneous nephrostomy tube placement, $106 for urology clinic consultation, $238 for preoperative center visit, $4057 for ureteroscopy with laser lithotripsy (URS), $2923 for extracorporeal shock wave lithotripsy, $169 for clinic stent removal, $197 for abdominal x-ray, and $166 for ultrasound. The lowest cost pathway ($1388) was for medical expulsive therapy, whereas the most expensive pathway ($8002) entailed a repeat ED visit prompting temporizing stent placement and interval URS. CONCLUSION: We found a high degree of cost variation between care pathways common to management of acute ureteral stone episodes. Reliable cost accounting data and an understanding of variability in clinical pathway costs can inform value-based care redesign as payors move away from pure fee-for-service reimbursement.

Value-Based Healthcare in Urology: A Collaborative Review.

CONTEXT: In response to growing concerns over rising costs and major variation in quality, improving value for patients has been proposed as a fundamentally new strategy for how healthcare should be delivered, measured, and remunerated. OBJECTIVE: To systematically review the literature regarding the implementation and impact of value-based healthcare in urology. EVIDENCE ACQUISITION: A systematic review was performed to identify studies that described the implementation of one or more elements of value-based healthcare in urologic settings and in which the associated change in healthcare value had been measured. Twenty-two publications were selected for inclusion. EVIDENCE SYNTHESIS: Reorganization of urologic care around medical conditions was associated with increased use of guidelines-compliant care for men with prostate cancer, and improved outcomes for patients with lower urinary tract symptoms. Measuring outcomes for every patient was associated with improved prostate cancer outcomes, while the measurement of costs using time-driven activity-based costing was associated with reduced resource utilization in a pediatric multidisciplinary clinic. Centralization of urologic cancer care in the UK, Denmark, and Canada was associated with overall improved outcomes, although systems integration in the USA yielded mixed results among urologic cancer patients. No studies have yet examined bundled payments for episodes of care, expanding the geographic reach for centers of excellence, or building enabling information technology platforms. CONCLUSIONS: Few studies have critically assessed the actual or simulated implementation of value-based healthcare in urology, but the available literature suggests promising early results. In order to effectively redesign care, there is a need for further research to both evaluate the potential results of proposed value-based healthcare interventions and measure their effects where already implemented. PATIENT SUMMARY: While few studies have evaluated the implementation of value-based healthcare in urology, the available literature suggests promising early results.

Utilizing time-driven activity-based costing to determine open radical cystectomy and ileal conduit surgical episode cost drivers.

OBJECTIVES: Patients undergoing radical cystectomy represent a particularly resource-intensive patient population. Time-driven activity based costing (TDABC) assigns time to events and then costs are based on the people involved in providing care for specific events. To determine the major cost drivers of radical cystectomy care we used a TDABC analysis for the cystectomy care pathway. SUBJECTS AND METHODS: We retrospectively reviewed a random sample of 100 patients out of 717 eligible patients undergoing open radical cystectomy and ileal conduit for bladder cancer at our institution between 2012 and 2015. We defined the cycle of care as beginning at the preoperative clinic visit and ending with the 90-day postoperative clinic visit. TDABC was carried out with construction of detailed process maps. Capacity cost rates were calculated and the care cycle was divided into 3 phases: surgical, inpatient, and readmissions. Costs were normalized to the lowest cost driver within the cohort. RESULTS: The mean length of stay was 6.9 days. Total inpatient care was the main driver of cost for radical cystectomy making up 32% of the total costs. Inpatient costs were mainly driven by inpatient staff care (76%). Readmissions were responsible for 29% of costs. Surgery was 31% of the costs, with the majority derived from operating room staff costs (65%). CONCLUSION: The major driver of cost in a radical cystectomy pathway is the inpatient stay, closely followed by operating room costs. Surgical costs, inpatient care and readmissions all remain significant sources of expense for cystectomy and efforts to reduce cystectomy costs should be focused in these areas.

Activity-Based Costing of Intensity-Modulated Proton versus Photon Therapy for Oropharyngeal Cancer.

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.

A method for defining value in healthcare using cancer care as a model.

Value-based healthcare delivery is being discussed in a variety of healthcare forums. This concept is of great importance in the reform of the US healthcare delivery system. Defining and applying the principles of value-based competition in healthcare delivery models will permit future evaluation of various delivery applications. However, there are relatively few examples of how to apply these principles to an existing care delivery system. In this article, we describe an approach for assessing the value created when treating cancer patients in a multidisciplinary care setting within a comprehensive cancer center. We describe the analysis of a multidisciplinary care center that treats head and neck cancers, and we attempt to examine how this center integrates with Porter and Teisberg's (2006) concept of value-based competition based on the results analysis. Using the relationship between outcomes and costs as the definition of value, we developed a methodology to analyze proposed outcomes for a population of patients treated using a multidisciplinary approach, and we matched those outcomes to the costs of the care provided. We present this work as a model for defining value for a subset of patients undergoing active treatment. The method can be applied not only to head and neck treatments, but to other modalities as well. Public reporting of this type of data for a variety of conditions can lead to improved competition in the healthcare marketplace and, as a result, improve outcomes and decrease health expenditures.

Value-Based Health Care in Undergraduate Medical Education.

PROBLEM: Value-based health care (VBHC) is an innovative framework for redesigning care delivery to achieve better outcomes for patients and reduce cost; however, providing students with the skills to understand and engage with these topics is a challenge to medical educators. APPROACH: Here, the authors present a novel, VBHC curriculum integrated into a required course for post-core clerkship students-launched in 2018 at Harvard Medical School and taught in conjunction with Harvard Business School faculty-that highlights key principles of VBHC most relevant to undergraduate medical education. The course integrates VBHC with related health disciplines, including health policy, ethics, epidemiology, and social medicine, using a case-based method. Students practice active decision making while learning key concepts to address value in clinical practice. OUTCOMES: Since the course's inception in March 2018, 95 students (87%) completed the standardized course evaluation; the majority said VBHC content and pedagogical style (i.e., case-based learning) enhanced their learning. Students' critiques focused on too little integration with other disciplines (e.g., social medicine, ethics), the physical space, and inadequate time for debates about potential tensions between VBHC and other course disciplines. NEXT STEPS: The authors believe that by exposing medical students to the principles of VBHC, students will fulfill the expectations of graduating physicians by excelling as critical thinkers, collaborative team members, and judicious care providers throughout their residency, clinical practice, and beyond. Future VBHC curricula expansions may include elective coursework, intensive seminar series, and formal dual degrees.