Will Freking, Bandele Okelana, Arthur Only, Logan McMillan, Kendra Kibble, Harsh Parikh, Benjamin Williams, David Shearer, Brian Cunningham
{"title":"Can Reducing Implant Costs Increase Revenue for Surgically Treated Ankle Fractures: Time-Driven Activity-Based Costing for 1-Year Episode of Care.","authors":"Will Freking, Bandele Okelana, Arthur Only, Logan McMillan, Kendra Kibble, Harsh Parikh, Benjamin Williams, David Shearer, Brian Cunningham","doi":"10.1177/19386400211062456","DOIUrl":null,"url":null,"abstract":"<p><strong>Background: </strong>The purpose of this study was to investigate whether decision-making regarding implant selection affects the reimbursement margins for the surgical fixation of ankle fractures.</p><p><strong>Methods: </strong>All ankle fractures treated between 2010 and 2017 within a single-insurer database were identified via Current Procedural Terminology codes by review of electronic medical record. Implant cost was determined via the implant record cross-referenced with the single contract institutional charge master database. The Time-Driven Activity-Based Costing (TDABC) technique was used to determine the costs of care during all activities throughout the 1-year episode of care. Statistical analysis consisted of multiple linear regression and goodness-of-fit analyses.</p><p><strong>Results: </strong>In all, 249 patients met inclusion criteria. Implant costs ranged from $173 to $3944, averaging $1342 ± $751. The TDABC-estimated cost of care ranged from $1416 to $9185, averaging $3869 ± $1384. Finally, the total reimbursed cost of care ranged between $1335 and $65 645, averaging $13 954 ± $9445. The implant costs occupied an estimated 34.7% of the TDABC-estimated cost of care per surgical encounter. Implant cost, as a percentage of the overall TDABC, was estimated as 36.2% in the inpatient setting and 33% in the outpatient setting, which was the second highest percentage behind surgical costs in both settings. We found a significant increase in net revenue of $1.93 for each dollar saved on implants in the outpatient setting, whereas the increase in net revenue per dollar saved of $1.03 approached significance in the inpatient setting.</p><p><strong>Conclusion: </strong>There is a direct relationship between intraoperative decision-making, as evidenced by implant choices, and the revenue generated by surgical fixation of ankle fractures. Intraoperative decision-making that is cognitive of implant cost can facilitate adoption of institutional cost containment measures and prompt increased healthcare value.</p><p><strong>Level of evidence: </strong><i>Level III: Retrospective cohort study</i>.</p>","PeriodicalId":73046,"journal":{"name":"Foot & ankle specialist","volume":" ","pages":"137-145"},"PeriodicalIF":0.0000,"publicationDate":"2024-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Foot & ankle specialist","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1177/19386400211062456","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"2021/12/7 0:00:00","PubModel":"Epub","JCR":"","JCRName":"","Score":null,"Total":0}
引用次数: 0
Abstract
Background: The purpose of this study was to investigate whether decision-making regarding implant selection affects the reimbursement margins for the surgical fixation of ankle fractures.
Methods: All ankle fractures treated between 2010 and 2017 within a single-insurer database were identified via Current Procedural Terminology codes by review of electronic medical record. Implant cost was determined via the implant record cross-referenced with the single contract institutional charge master database. The Time-Driven Activity-Based Costing (TDABC) technique was used to determine the costs of care during all activities throughout the 1-year episode of care. Statistical analysis consisted of multiple linear regression and goodness-of-fit analyses.
Results: In all, 249 patients met inclusion criteria. Implant costs ranged from $173 to $3944, averaging $1342 ± $751. The TDABC-estimated cost of care ranged from $1416 to $9185, averaging $3869 ± $1384. Finally, the total reimbursed cost of care ranged between $1335 and $65 645, averaging $13 954 ± $9445. The implant costs occupied an estimated 34.7% of the TDABC-estimated cost of care per surgical encounter. Implant cost, as a percentage of the overall TDABC, was estimated as 36.2% in the inpatient setting and 33% in the outpatient setting, which was the second highest percentage behind surgical costs in both settings. We found a significant increase in net revenue of $1.93 for each dollar saved on implants in the outpatient setting, whereas the increase in net revenue per dollar saved of $1.03 approached significance in the inpatient setting.
Conclusion: There is a direct relationship between intraoperative decision-making, as evidenced by implant choices, and the revenue generated by surgical fixation of ankle fractures. Intraoperative decision-making that is cognitive of implant cost can facilitate adoption of institutional cost containment measures and prompt increased healthcare value.
Level of evidence: Level III: Retrospective cohort study.