Utilization of Time-driven Activity-based Costing to Determine the True Cost of a Single or 2-level Anterior Cervical Discectomy and Fusion. Issue 10 (December 2018)

• Record Type: Journal Article
• Authors: Schroeder, Gregory D.; Hilibrand, Alan S.; Kepler, Christopher K.; McKenzie, James C.; Nicholson, Kristen J.; Stawicki, Christie; Paul, Jonathan; Kumar, Priyanka; Hollern, Douglas A.; Murphy, Hamadi; Milhouse, Paul W.; Kurd, Mark F.; Woods, Barret I.; Radcliff, Kris E.; Anderson, David G.; Vaccaro, Alexander R.; Rihn, Jeffery A.
• Is Part Of: Clinical spine surgery. Volume 31:Issue 10(2018)
• Publication Date: 2018-12
• Subjects: cost analysis -- value-bases health care -- anterior cervical discectomy and fusion; Spinal cord -- Diseases -- Periodicals; Spinal cord -- Surgery -- Periodicals; 617.56059
• DOI: 10.1097/BSD.0000000000000728
• Languages: English
• ISSNs: 2380-0186

Abstract

Abstract : Study Design: This is a prospective case series. Objective: To determine the actual cost of performing 1- or 2-level anterior cervical discectomy and fusion (ACDF) using actual patient data and the time-driven activity-based cost methodology. Summary of Background Data: As health care shifts to use value-based reimbursement, it is imperative to determine the true cost of surgical procedures. Time-driven activity-based costing determines the cost of care by determining the actual resources used in each step of the care cycle. Materials and Methods: In total, 30 patients who underwent a 1- or 2-level ACDF by 3 surgeons at a specialty hospital were prospectively enrolled. To build an accurate process map, a research assistant accompanied the patient to every step in the care cycle including the preoperative visit, the preadmission testing, the surgery, and the postoperative visits for the first 90 days. All resources utilized and the time spent with every member of the care team was recorded. Results: In total, 27 patients were analyzed. Eleven patients underwent a single-level ACDF and 16 underwent a 2-level fusion. The total cost for the episode of care was $29, 299±$5048. The overwhelming cost driver was the hospital disposable costs ($13, 920±$6325) which includes every item used during the hospital stay. Intraoperative personnel costs including fees for the surgeon, resident/fellow, anesthesia, nursing, surgical technician, neuromonitoring, radiology technician and orderlies, accounted for the second largest cost at $6066±$1540. The total cost excluding hospital overhead and disposables was $9071±$1939. Conclusions: Reimbursement for a bundle of care surrounding a 1- or 2-level ACDF should be no less than $29, 299 to cover the true costs of the care for the entire care cycle. However, this cost may not include the true cost of all capital expenditures, and therefore may underestimate the cost.