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.

Reducing Medication Waste While Improving Access to Sugammadex: A Quality Improvement Project in Medication Stewardship.

The relatively high cost of sugammadex compared to neostigmine limits its widespread use to reverse neuromuscular blockade, despite its faster onset and more complete clinical effect. While ensuring timely access to sugammadex is important in improving perioperative safety, it is also vital to control unnecessary spending. We describe a quality improvement initiative to reduce excess spending on sugammadex while improving access for anesthesia providers. Monthly spending on sugammadex decreased by 52% ($70,777 vs $33,821), while medication access increased via automated medication dispensers in each operating room. Clinical usage decreased by one-third, with presumed increased adherence to dosing guidelines.

ECONOMIC EFFECTIVENESS OF DIFFERENT METHODS OF ANESTHESIA OF CURETTAGE OF UTERINE CAVITY.

Anesthesia of curettage of uterine cavity (CUC) at postoperative period causes additional expenses. Preventive intraoperative anesthesia makes it possible to reduce these expenses and provide significant positive economic effect on state budget. The objective of this research is determination of influence of different methods of anesthesia of CUC on cash value of anesthetic maintenance of CUC and the possibility of saving of budgetary funds. 128 women took part in the research. They underwent the procedure of CUC. Anesthetic maintenance was performed using different medicamental combinations and their dosages. Mathematical calculation of the cost of each CUC stage was done considering the cost of consumables, medical preparations and value of labor of medical staff. In the course of this research, it was proven that a combination of additional use of dexketoprofen (at the stage of premedication of CUC) and performing preventive intraoperative applicational anesthesia with bupivacaine solution can save 130 452,26UAH of wage fund per year and general budget savings within the confines of a state can each 9 954 617,67UAH per year.

Solving the negative impact of congestion in the postanesthesia care unit: a cost of opportunity analysis.

BACKGROUND: Congestion in the postanesthesia care unit (PACU) leads to the formation of waiting queues for patients being transferred after surgery, negatively affecting hospital resources. As patients recover in the operating room, incoming surgeries are delayed. The purpose of this study was to establish the impact of this phenomenon in multiple settings. METHODS: An operational mathematical study based on the queuing theory was performed. Average queue length, average queue waiting time, and daily queue waiting time were evaluated. Calculations were based on the mean patient daily flow, PACU length of stay, occupation, and current number of beds. Data was prospectively collected during a period of 2 months, and the entry and exit time was recorded for each patient taken to the PACU. Data was imputed in a computational model made with MS Excel. To account for data uncertainty, deterministic and probabilistic sensitivity analyses for all dependent variables were performed. RESULTS: With a mean patient daily flow of 40.3 and an average PACU length of stay of 4 hours, average total lost surgical opportunity time was estimated at 2.36 hours (95% CI: 0.36-4.74 hours). Cost of opportunity was calculated at $1592 per lost hour. Sensitivity analysis showed that an increase of two beds is required to solve the queue formation. CONCLUSIONS: When congestion has a negative impact on cost of opportunity in the surgical setting, queuing analysis grants definitive actions to solve the problem, improving quality of service and resource utilization.

Example of cost calculations for an operating room and a post-anaesthesia care unit.

OBJECTIVE: The aim of this study was to evaluate the cost of an operating room using data from our hospital. Using an accounting-based method helped us. METHODS: Over the year 2012, the sum of direct and indirect expenses with cost sharing expenses allowed us to calculate the cost of the operating room (OR) and of the post-anaesthesia care unit (PACU). RESULTS: The cost of the OR and PACU was €10.8 per minute of time offered. Two thirds of the direct expenses were allocated to surgery and one third to anaesthesia. Indirect expenses were 25% of the direct expenses. The cost of medications and single use medical devises was €111.45 per anaesthesia. The total cost of anaesthesia (taking into account wages and indirect expenses) was €753.14 per anaesthesia as compared to the total cost of the anaesthesia. The part of medications and single use devices for anaesthesia was 14.8% of the total cost. CONCLUSION: Despite the difficulties facing cost evaluation, this model of calculation, assisted by the cost accounting controller, helped us to have a concrete financial vision. It also shows that a global reflexion is necessary during financial decision-making.

Residents' scholarly activity: a cost analysis with regard to its effects on departments.

PURPOSE OF REVIEW: Current financial strain on training departments may have a significantly negative impact on continuing support for residents' scholarly activity. A cost analysis with regard to residents' scholarly activity effects on anesthesiology training departments is performed. RECENT FINDINGS: The Accreditation Council for Graduate Medical Education has issued a new outcome-focused scholarly activity requirement. Low scholarly achievement by anesthesiology faculty in the USA has been documented and needs transformation. It is evident that a structured scholarly activity support system is effective. To support such a system, training departments need to support anesthesiology residents' nonclinical time, which would cost an average of $13,500 per month per resident using nonresident hands-on care providers in operating rooms, resident's meeting attendance in average $1,424 per resident per meeting, and faculty mentorship and other infrastructure. It must also be taken into account that missed clinical opportunities by an anesthesiology resident during nonclinical time are an estimated average of 60 cases per month. SUMMARY: The importance of resident scholarly activity has never been so or as critical as in the present. Anesthesiology leadership must continue to invest to support resident scholarly activity for the future of the specialty while being mindful of costs incurred.

Fiscal implications of newborn screening in the diagnosis of severe combined immunodeficiency.

In the United States, newborn screening (NBS) is currently recommended for identification of 31 debilitating and potentially fatal conditions. However, individual states determine which of the recommended conditions are screened. The addition of severe combined immunodeficiency (SCID) screening to the recommended NBS panel has been fully instituted by 18 states, with another 11 states piloting programs or planning to begin screening in 2014. Untreated, SCID is uniformly fatal by 2 years of age. Hematopoietic stem cell transplantation usually is curative, but the success rate depends on the age at which the procedure is performed. Short-term implementation costs may be a barrier to adding SCID to states' NBS panels. A retrospective economic analysis was performed to determine the cost-effectiveness of NBS for early (<3.5 months) versus late (≥3.5 months) treatment of children with SCID at 3 centers over 5 years. The mean total charges at these centers for late treatment were 4 times greater than early treatment ($1.43 million vs $365,785, respectively). Mean charges for intensive care treatments were >5 times higher ($350,252 vs $66,379), and operating room-anesthesia charges were approximately 4 times higher ($57,105 vs $15,885). The cost-effectiveness of early treatment for SCID provides a strong economic rationale for the addition of SCID screening to NBS programs of other states.

How hospital leaders can bend the anesthesia cost curve.

Factors to consider in evaluating a hospital's anesthesia cost curve include: The efficiency of services provided by anesthesiologists and certified registered nurse anesthetists. Cost-effectiveness of anesthesia staffing. Anesthesia billing performance. Patient satisfaction with anesthesia services.

Lack of value of scheduling processes to move cases from a heavily used main campus to other facilities within a health care system.

BACKGROUND: Economically, the most important anesthesia group and operating room (OR) management decision is the choice made months before surgery of the allocated OR time (duration of the workday) for each service. Consider a health system with surgeons who practice at multiple hospitals and ambulatory surgery centers. The main campus' ORs are busy, with nearly 8 h of cases, including turnovers, per anesthetizing location per workday. The other (regional) facilities have substantial underutilized time. A surgeon wants to do one 3-hour case at the main campus and have an afternoon start. The anesthesia group's OR director could use the health systems' common OR information system to examine the surgeons' schedules at all facilities. In this study, we quantify the percentage of OR hours that can practically be off-loaded from a main campus with long duration workdays. METHODS: One year of cases were evaluated from a health system with a busy main campus, multiple (11) regional facilities with low workload per OR per day, and a common OR information system. RESULTS: The OR time was summed among surgeons meeting the following criteria: no first case start at the main campus that day; performing <4 hour of elective cases at the main campus that day; and doing at least 1 case at any of the regional facilities within the preceding or following week. The OR time potentially moveable was <0.8% (95% CI, 0.7% to 0.8%) of the total OR time used by all surgeons operating at the main campus, considerably less than the managerially important threshold of "≥ 5.0%" (P < 0.0001). The principal reason for the result was that few (10%) OR hours at the main campus were used by surgeons performing <4 hour of cases that day. To understand why so little OR time could be moved, we performed secondary analysis of different data from 21 facilities nationwide. Larger hours of cases per OR per workday (e.g., 7.8 hour at the main facility) were commonly associated with larger percentages of workdays for which single surgeons filled an OR for the day (r = 0.87 ± 0.05). CONCLUSIONS: For many health systems, investing in the software and personnel to coordinate case scheduling among facilities is unlikely to be of benefit, either operationally or financially.

Availability of anesthesia equipment in Chinese hospitals: is the safety of anesthesia patient care assured?

Availability of physiologic monitoring equipment to ensure the safe administration of anesthesia is an expected standard in many parts of the world. Many hospitals in China may not have an adequate quantity and variety of anesthesia delivery and patient monitoring equipment to assure safe administration of anesthesia patient care. We present some typical cases of hospitals of different sizes and located in regions with different economic levels; our data demonstrate that there is a lack of available anesthesia administration and patient monitoring equipment in small hospitals and hospitals in economically underdeveloped regions.

Perspective: Hospital support for anesthesiology departments: aligning incentives and improving productivity.

Anesthesiology groups, particularly academic departments, are increasingly dependent on hospital support for financial viability. Economic stresses are driven by higher patient acuity, by multiple subspecialty service and call demands, by high-risk obstetric services, and by long case durations attributable to both case complexity and time for teaching. An unfavorable payer mix, university taxation, and other costs associated with academic education and research missions further compound these stresses. In addition, the current economic climate and the uncertainty surrounding health care reform measures will continue to increase performance pressures on hospitals and anesthesiology departments.Although many researchers have published on the mechanics of operating room (OR) productivity, their investigations do not usually address the motivational forces that drive individual and group behaviors. Institutional tradition, surgical convenience, and parochial interests continue to play predominant roles in OR governance and scheduling practices. Efforts to redefine traditional relationships, to coordinate operational decision-making processes, and to craft incentives that align individual performance goals with those of the institution are all essential for creating greater economic stability. Using the principles of shared costs, department autonomy, hospital flexibility and control over institutional issues, and alignment between individual and institutional goals, the authors developed a template to redefine the hospital-anesthesiology department relationship. Here, they describe both this contractual template and the results that followed implementation (2007-2009) at one institution.

[Strategic planning: an important economic action for German hospitals]. / Strategische Planung - Eine wichtige ökonomische Handlungsweise für deutsche Krankenhäuser.

In medical systems, economic issues and means of action are in the course of dwindling human (physicians and nurses) and financial resources are more important. For this reason, physicians must understand basic economic principles. Only in this way, there may be medical autonomy from social systems and hospital administrators. The current work is an approach to present a model for strategic planning of an anesthesia department. For this, a "strengths", "weaknesses", "opportunities", and "threats" (SWOT) analysis is used. This display is an example of an exemplary anaesthetic department.

Workforce and finances of the United States anesthesiology training programs: 2009-2010.

Financial and workforce surveys were sent to 121 and 124 United States Anesthesiology training programs in 2009 and 2010, respectively. Seventy-two respondents (60%) and 81 respondents (65%) demonstrated median institutional support per faculty of $120,000 and $111,000; open faculty positions of 4% and 4.8%. Faculty billed an average of 11,050 units/year and collected $35.00/unit. In 2010, 56% of departments had installed anesthesia information management systems and 14% have signed a contract for an anesthesia information management system.

[Splitting of supplemental revenues in intensive care medicine]. / Erlöszuordnung von Zusatzentgelten in der Intensivmedizin.

In patient care several clinical departments are often involved in the treatment of a single case. Due to this shared work and internal patient transfer between departments the respective departments have to share the single reimbursement sum which is granted for each hospital case in the German DRG system. The intensive care unit in particular, at least if maintained as an independent department, has a high rate of internal transfers and most of the patients will be transferred back to the original department prior to discharge from hospital. Different models have been suggested regarding the splitting of DRG reimbursement between clinical departments, however, no research has been done on the splitting of supplemental revenues. The allocation of supplemental revenues is especially complex for revenues generated over many days of hospital care or for clustered revenues. In most cases the supplemental revenues are simply allocated to the department from which the patient is ultimately discharged. This would lead to a significant economic risk for the intensive care unit, as a considerable proportion of medical services which are eligible for triggering supplemental revenues are applied there. In this study all cases treated in two intensive care units in a university hospital in 2007 were analyzed in which supplemental revenue-related medical services were performed over a longer period of time or graduated according to different amounts. In a total of 385 cases, 691 supplemental revenues were analyzed. Three different methods of supplemental revenues allocation were analyzed regarding the financial impact on the intensive care unit: allocation to the department from which the patient is discharged, allocation according to the length of stay in a particular department (in this case the intensive care unit) and allocation based on actually documented medical services eligible for supplemental revenues. The supplemental revenues take up a considerable share of the total reimbursement for intensive care. Based on the first 2 allocation methods the intensive care unit would receive 20% less supplemental revenues compared to the third allocation method, which supposedly reflects best the actual costs.

Seventh and eighth year follow-up on workforce and finances of the United States anesthesiology training programs: 2007 and 2008.

We sent follow-up financial and workforce surveys to 121 United States anesthesiology training programs in 2007 and 2008. Seventy-four respondents (61%) demonstrated a continued increase in the institutional support for faculty and stabilization in the number of open positions. Institutional support per faculty full time equivalent with certified nurse anesthetist support removed averages $109,000. A 7% open faculty position rate is characterized by a preponderance of generalists (31%) and pediatric (21%) anesthesiologists.

Incentive payments to academic anesthesiologists for late afternoon work did not influence turnover times.

BACKGROUND: Anesthesiologists are often paid extra for hours worked in the late afternoon and evening. Although anesthesiologists have little influence on their operating room (OR) assignments and workloads late in the afternoon, they can influence turnover times. METHODS: OR turnover times on workdays were reviewed for n = 30 mo before there was incremental pay, for n = 15 mo with incremental pay for work past 3:30 pm, and for n = 8 mo with pay for work past 4:00 pm. The end point was the percentage of turnovers that were prolonged, defined as longer than 1 h. Turnovers straddling 3:30 pm (n = 3945), 4:00 pm (n = 3602), and 5:00 pm (n = 2834) were studied, as were those straddling 2:00 pm (n = 4407) as a control. In addition, qualitative (survey) assessment of n = 30 anesthesiologists was performed the last month to learn about their opinions on working late on weekdays. RESULTS: Most respondents considered an OR to run late if it finished after a specific time of day (87%, P < 0.001), unrelated to the room's type of procedures (90%, P < 0.001) or to the payment for working after 4:00 pm (100%, P < 0.001). There was no significant effect of implementation or changes to the incentive program on the incidences of prolonged turnover times at each of the studied times in the afternoon (all P > 0.14). CONCLUSION: Our results suggest that hospital administrators, deans, and other executives need not be especially concerned about disincentives produced by methods of internal compensation of anesthesiologists on highly visible OR turnover times late in afternoons.

Acute pain management efficiency improves with point-of-care handheld electronic billing system.

BACKGROUND: Technology advances continue to impact patient care and physician workflow. To enable more efficient performance of billing activities, a point-of-care (POC) handheld computer technology replaced a paper-based system on an acute pain management service. METHODS: Using a handheld personal digital assistant (PDA) and software from MDeverywhere (MDe, MDeverywhere, Long Island, NY), we performed a 1-yr prospective observational study of an anesthesiology acute pain management service billings and collections. Seventeen anesthesiologists providing billable acute pain services were trained and entered their charges on a PDA. Twelve months of data, just before electronic implementation (pre-elec), were compared to a 12-m period after implementation (post-elec). RESULTS: The total charges were 4883 for 890 patients pre-elec and 5368 for 1128 patients post-elec. With adoption of handheld billing, the charge lag days decreased from 29.3 to 7.0 (P < 0.001). The days in accounts receivable trended downward from 59.9 to 51.1 (P = 0.031). The average number of charge lag days decreased significantly with month (P = 0.0002). The net collection rate increased from 37.4% pre-elec to 40.3% post-elec (P < 0.001). The return on investment was 1.18 fold (118%). CONCLUSIONS: Implementation of POC electronic billing using PDAs to replace a paper-based billing system improved the collection rate and decreased the number of charge lag days with a positive return on investment. The handheld PDA billing system provided POC support for physicians during their daily clinical (e.g., patient locations, rounding lists) and billing activities, improving workflow.