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A Bottom-Up Cost Analysis of Both a Hybrid Operating Room and Conventional Operating Room

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A Bottom-Up Cost Analysis of Both a Hybrid Operating Room and Conventional Operating Room http://ijhpm.com Int J Health Policy Manag 2020, x(x), 1–9 doi 10.34172/ijhpm.2020.119 Original Article Understanding the Costs of Surgery: A Bottom-Up Cost Analysis of Both a Hybrid Operating Room and Conventional Operating Room Sejal Patel1*¶ ID , Melanie Lindenberg2,3¶ ID , Maroeska M. Rovers1,4, Wim H. van Harten2,3, Theo J.M. Ruers5, Lieke Poot6, Valesca P. Retel2,3, Janneke P.C. Grutters1,4 ID Abstract Article History: Background: Over the past decade, many hospitals have adopted hybrid operating rooms (ORs). As resources are limited, Received: 6 January 2020 these ORs have to prove themselves in adding value. Current estimations on standard OR costs show great variety, while Accepted: 29 June 2020 cost analyses of hybrid ORs are lacking. Therefore, this study aims to identify the cost drivers of a conventional and ePublished: 27 July 2020 hybrid OR and take a first step in evaluating the added value of the hybrid OR. Methods: A comprehensive bottom-up cost analysis was conducted in five Dutch hospitals taking into account: construction, inventory, personnel and overhead costs by means of interviews and hospital specific data. The costs per minute for both ORs were calculated using the utilization rates of the ORs. Cost drivers were identified by sensitivity analyses. Results: The costs per minute for the conventional OR and the hybrid OR were €9.45 (€8.60-€10.23) and €19.88 (€16.10- €23.07), respectively. Total personnel and total inventory costs had most impact on the conventional OR costs. For the hybrid OR the costs were mostly driven by utilization rate, total inventory and construction costs. The results were incorporated in an open access calculation model to enable adjustment of the input parameters to a specific hospital or country setting. Conclusion: This study estimated a cost of €9.45 (€8.60-€10.23) and €19.88 (€16.10-€23.07) for the conventional and hybrid OR, respectively. The main factors influencing the OR costs are: total inventory costs, total construction costs, utilization rate, and total personnel costs. Our analysis can be used as a basis for future research focusing on evaluating value for money of this promising innovative OR. Furthermore, our results can inform surgeons, and decision and policy-makers in hospitals on the adoption and optimal utilization of new (hybrid) ORs. ¶ Both authors contributed Keywords: Hybrid Operating Room, Costs, Surgery, Bottom-Up equally to this paper Copyright: © 2020 The Author(s); Published by Kerman University of Medical Sciences. This is an open-access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/ by/4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. Citation: Patel S, Lindenberg M, Rovers MM, et al. Understanding the costs of surgery: a bottom-up cost analysis *Correspondence to: of both a hybrid operating room and conventional operating room. Int J Health Policy Manag. 2020;x(x):x–x. Sejal Patel doi:10.34172/ijhpm.2020.119 Email: [email protected] Key Messages Implications for policy makers • In an era where sustainable healthcare is an important policy issue, cost drivers and accurate cost estimates of hybrid operating rooms (ORs) are lacking. • The costs of the hybrid OR were mainly driven by the inventory and construction costs and its utilization rate. • As the hybrid OR is substantially more expensive (€18.84 vs. €9.45), decision-makers and surgeons should be aware of the increased costs of the use of highly advanced ORs and weigh the extra costs with the health gain. • Besides providing insight in the costs of the OR, this paper can be used as a basis for future research focusing on evaluating the added value of the hybrid OR. Implications for the public We performed a comprehensive bottom-up cost-analysis to inform clinicians and policy-makers on the costs and cost drivers of an (hybrid) operating room (OR), as a first step in evaluating the added value of the hybrid OR. As the hybrid OR is substantially more expensive (€18.84 vs. €9.45), decision-makers and surgeons should be aware of the increased costs of the use of highly advanced ORs and weigh the extra costs with the health gain. Besides providing insight in these costs, our analysis can be used as a basis for future research focusing on evaluating value for money of this promising innovative OR. Full list of authors’ affiliations is available at the end of the article. Patel et al Introduction overhead (2.4) for a conventional and a hybrid OR. The Over the past decade, many academic and teaching hospitals construction, inventory, and personnel costs were evaluated have adopted a hybrid operating room (OR), and many others by interviews and hospital-specific data such as invoices and are considering it. The compound annual growth rate for the utilization data. By using hospital-specific invoice data we coming 5 years (2019-2023) of the hybrid OR market growth could perform a bottom-up analysis, instead of using total was estimated at 12.5%.1 annual expenses which is often done in a top-down analysis. The hybrid OR claims to improve efficiency by means Supplementary file 2 also reports the positions of the involved of reducing secondary procedures and improve surgical experts in these interviews. performance which results in improved clinical outcomes.2-5 In this study, the conventional OR was defined as an OR Hybrid ORs are currently mainly used for cardiovascular where open procedures are performed to evaluate the costs surgery,2-4 but for neurosurgery6 and surgical oncology7 of a basic OR environment. Endoscopic specific devices, to interest is increasing. The first observational studies in perform laparoscopic and robotic procedures, were thus left cardiovascular surgery verified this promising nature by out of the analysis. The hybrid OR was defined as an OR showing a reduced length of stay and reduced operation in which an imaging technique – at least a fixed C-arm – is time.8,9 Adoption of such an OR however is a large investment. installed. Since surgical healthcare expenditures already account for a large part of the annual healthcare costs, these innovative ORs Construction Costs have to prove themselves in terms of value for money.10-12 In constructing an (hybrid) OR, each hospital makes specific In evaluating the added value or cost-effectiveness of the choices for its design because of, among other things, hybrid OR, it is crucial to have insight in its incurred costs. architectural preferences or limitations, preferences for So far, the costs related to the hybrid OR have not been ventilation systems, country-specific legislation, and budget studied. Furthermore, to put suchcosts into perspective, constraints. To avoid such hospital-specific differences, we it is important to also gain insight into the incurred costs estimated total costs for constructing a square meter (m2) of related to the conventional OR setting. Current estimations an OR based on Dutch key numbers presented by the Dutch on the costs of a conventional OR report a great variety, advisory board on healthcare housing.21 Following these ranging from $7 to over $100 per minute.13,14 The variety key numbers, constructing a standard m2 in a hospital costs can be explained by differences in study design such as the €3479 in 2018. For the OR department, these costs should be inclusion of different cost categories eg, expensive implants, differentiated with 160%, resulting in a cost of €5.595 per m2 medical devices, robotics, and site differences as being a (non) (Cm2 costs OR department). teaching hospital, the number of available ORs, the occupancy This differentiated cost results in the costs of a m2 which rate and healthcare system (country-specific). These site does not take into account the different functionalities characteristics can especially have an influence as OR costs available within the OR department (corridors, stockrooms, are mainly evaluated top-down. As this method is known offices, holding and recovery department and the ORs). To to provide little insight into cost drivers and often results estimate the specific costs for a m2 of OR per hospital, we in inaccurate cost estimates,15 a bottom-up cost analysis is identified the total m2 of each of these specific functionalities proposed for further research. This method is used to provide within the OR department based on floor plans (eg, total m2 more insight into the cost drivers and enable optimization of of offices). The costs of these m2 were calculated using their processes which could result in cost reductions.15-19 specific differentiation based on key numbers and expert The aim of this study was to perform a comprehensive opinions, such as 140% for holding and recovery, 75% for bottom-up cost-analysis to inform clinicians and policy- corridors and offices as described in Table 1. The general m2 makers on the costs and cost drivers of an (hybrid) OR as a price of an OR per hospital was calculated by: first step in evaluating the added value of the hybrid OR. The results are incorporated in a calculation model to enable usage (1) 2 and adjustment of the input parameters to a specific hospital ∑C2 = ∑ ∗ C or country setting (Supplementary file 1). 2 (2) (∑ ∗ 2 ) – ∑C2 Methods 2 ℎ The bottom-up cost-analysis was conducted following The “C” in this ∑formulaM refers to costs and the “M2” to the the Dutch guideline for costing analyses.20 This guideline square meters. An example of the calculation can be found in contains reference prices and formulas to estimate costs Supplementary file 3.
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