Variation in Costs Among Surgeons and Hospitals in Pediatric Tympanostomy Tube Placement

Transcription

1 The Laryngoscope VC 2015 The American Laryngological, Rhinological and Otological Society, Inc. Variation in Costs Among Surgeons and Hospitals in Pediatric Tympanostomy Tube Placement Phayvanh P. Sjogren, MD; Craig Gale, MS; Jacob Henrichsen, BS; Griffin Olsen, BS; Mark J. Ott, MD; Matthew Peters; Rajendu Srivastava, MD, FRC(C), MPH; Jeremy D. Meier, MD Objectives/Hypothesis: 1) Identify the major expenses for outpatient pediatric tympanostomy tube placement in a multihospital network. 2) Compare differences for variations in costs among hospitals and surgeons. Methods: An observational cohort study in a multihospital network using a standardized activity-based accounting system to determine hospital costs for tympanostomy tube placement from February 2011 to January Children aged 6 months to less than 3 years old who underwent same-day surgery (SDS) for tympanostomy tubes at 15 hospital facilities were included. Subjects with additional procedures were excluded. Hospital costs were subdivided into categories including operating room (OR), SDS preoperative, SDS postoperative, postanesthesia care unit, anesthesia, pharmacy, and OR supplies. Results: The study cohort included 5,623 patients undergoing tympanostomy tube placement by 67 surgeons. Mean cost per surgery was $769 6 $3. Significant variations (P < 0.001) in mean cost per procedure were identified by hospital (range $ $38 to $509 6 $11) and by surgeon (range $ $75 to $660 6 $11). Operating room and SDS preoperative were the greatest expenditures; each category accounted for over 30% of overall costs. Pharmacy costs and OR costs were some of the major drivers of cost variation among surgeons. Conclusion: This study demonstrates that OR and SDS preoperative costs accounted for the greatest expenditure in tympanostomy tube placement, and significant variation exists among surgeons and hospitals within a multihospital network. Further research is needed to elucidate factors accounting for such variation in cost and the overall impact on patient outcomes. Key Words: Pediatric, tympanostomy, tube, costs, ototopical treatment, variation. Level of Evidence: 4. Laryngoscope, 126: , 2016 From the Division of Otolaryngology Head and Neck Surgery (P.S., J.D.M.); the Division of Pediatric Inpatient Medicine, Department of Pediatrics (R.S.), University of Utah School of Medicine; the Primary Children s Hospital (R.S.), the Institute for Health Care Delivery Research (R.S.), Intermountain Healthcare Inc., Salt Lake City; and the Intermountain Healthcare, Surgical Services Clinical Program, Intermountain Medical Center (C.G., J.H., G.O., M.O., M.P.), Murray, Utah, U.S.A. Editor s Note: This Manuscript was accepted for publication October 12, Presented at the Triological Society 118th Annual Meeting at the Combined Sections Meeting in Boston, Massachusetts, U.S.A, April 24 25, Dr. Jeremy D. Meier received a Triological Society Career Development Award unrelated to this research. Dr. Rajendu Srivastava chairs the Pediatric Research in Inpatient Settings with several federally funded grants, none of which are related to this research. The authors have no other funding, financial relationships, or conflicts of interest to disclose. Send correspondence to Jeremy D. Meier, MD, Assistant Professor, University of Utah, Division of Otolaryngology Head and Neck Surgery, 50 North Medical Drive, Room 3C120, Salt Lake City, UT Jeremy.meier@imail.org DOI: /lary INTRODUCTION Acute otitis media is one of the most common illnesses of childhood and represents the most common indication for pediatric antibiotic therapy and clinic visits in the United States. 1 Recurrent infections, infections not resolved after antibiotic therapy, or those that result in persistent middle ear fluid benefit from ventilation tubes. Myringotomy with tube insertion is the most common ambulatory surgery in children aged less than 15 years old, with approximately 667 thousand cases performed each year in the United States. 2 Given the high prevalence of this disease, costs associated with otitis media have been under surveillance since the 1980s and continue to pose a major health care utilization concern. 3 Both direct and indirect costs of acute otitis media and chronic otitis media with effusion have been estimated to have an annual economic burden exceeding $5 billion. 4,5 In the climate of rising health care costs, recent guidelines for this commonly performed surgery were published by the American Academy of Otolaryngology Head and Neck Surgery Foundation. The updated recommendations focus on patient selection, surgical indications, and management of tympanostomy tubes in children. 6 However, the guidelines do not specifically address perioperative considerations, which directly drive surgical costs. A major priority of current health care reform is to transition from a volume-based to a value-based delivery system. More and more, reimbursement models are focusing on quality rather than the quantity of care delivered. 7 One approach includes bundled payment plans in which reimbursement is provided for the entire episode of care related to a specific diagnosis or problem. This repayment model could apply to common conditions such as otitis media or procedures such as tympanostomy tube placement. To anticipate 1935

2 future reform, it is imperative that otolaryngologists understand the costs for these common procedures and identify the drivers of variation in costs. Intermountain Healthcare (Intermountain; Murray, UT) is a nonprofit, integrated health care system that includes 22 hospitals ranging from tertiary care referral centers to community and rural hospitals in the Intermountain West. Intermountain houses the Enterprise Data Warehouse (EDW), a comprehensive database that contains administrative, financial, and clinical information. The financial data in the EDW are beneficial in that hospital costs, and not simply charges, are recorded. Charge data depend on payment agreements between hospitals and third-party payers without correlation to the actual cost of the operation. Alternatively, cost data represent a more accurate assessment of resources actually utilized. We have previously used this database to evaluate variation in adenotonsillectomy costs and complications among hospitals and surgeons within the tertiary children s hospital 8 and across the Intermountain system. 9 The purpose of this study is to identify the major expenses for outpatient pediatric tympanostomy tube placement in a multihospital network and to delineate areas of cost variation among hospitals and surgeons. MATERIALS AND METHODS The institutional review board at Intermountain Healthcare approved this study. The EDW was queried for encounters with International Classification of Diseases, 9th Revision, Clinical Modification (ICD-9-CM) procedure code (myringotomy with insertion of tube) for patients aged 6 months to less than 3 years old between February 2011 and January There were a total of 15 hospital facilities included in the study (14 hospitals and 1 hospital outpatient surgery center). Eight additional hospitals within Intermountain were excluded because the cost accounting systems at these hospitals were missing at least some pertinent data related to this procedure. Subjects with additional ICD-9-CM procedure codes during the encounter or costs attributed to other services in the hospital (e.g., oncology, audiology) were excluded to ensure that patients undergoing tympanostomy tube placement alone were included in the analysis. To limit confounding factors secondary to medical complexity, only patients listed as same-day discharges were included in the study cohort. All operations were performed in a hospital operating room (OR) or the off-site hospital outpatient surgery center associated with the children s hospital. Hospital costs were subdivided into categories including OR, same-day services (SDS) preoperative registration and evaluation, SDS postoperative care, postanesthesia care unit (PACU), anesthesia (not including professional fees), and pharmacy costs. Mean total cost for the procedure and costs by subcategory were determined across the entire system. Mean costs per hospital and per surgeon were also calculated. In addition, mean total OR time was measured per hospital and surgeon. Analysis of variance was applied to determine statistical differences in costs between hospitals and surgeons. RESULTS A total of 67 surgeons performed tympanostomy tube placement on 5,801 patients at 15 hospital facilities. Patients (n 5 77) with additional activities such as 1936 Fig. 1. Breakdown of total costs per case by subcategory across the entire cohort. audiology, respiratory therapy, emergency department, or oncology clinic visits attached to the tympanostomy tube encounter were excluded. Subjects were also excluded if OR or pharmacy costs were incomplete (n 5 101), leading to a total of 5,623 patients in the final cohort. The mean cost per case was $ A breakdown of the costs by category is shown in Figure 1, demonstrating that OR and SDS preoperative services were the greatest expenditures. Each of these categories accounted for over 30% of the overall costs. Figure 2 depicts the mean cost per procedure by hospital (range $ $38 to $509 6 $11). Figure 3 depicts the mean cost per procedure by surgeon (range $ $75 to $660 6 $11). Significant variation in costs was identified among hospitals and surgeons (P < 0.001). Figure 4 depicts the variation in costs by each surgeon at each hospital. In Figure 4, 18 surgeons performed only one case at certain facilities; therefore, these 18 data points are omitted from the figure. The mean total OR time per case (n 5 5,801) was 13.8 minutes. This ranged from 8.9 minutes in one hospital (n 5 150) to 25.2 minutes in another hospital (n 5 56), and from 8.9 minutes in one surgeon (n 5 146) to 35.5 minutes in another surgeon (n 5 2). Figure 5 depicts the breakdown of OR time per case by surgeon at each hospital. Table I shows the coefficient of variation for different subcategories of costs across the entire cohort. This table also shows the range of mean subcategory costs per surgeon at the pediatric outpatient surgery center. DISCUSSION Variation in health care delivery exists at the provider, hospital, and regional level. 10 Some types of variation are inevitable; however, the variation is deemed unwarranted when not explained by the type or severity of illness, patient preference, or dictates of evidencebased medicine. 11 This unwarranted variation can increase economic burden by creating waste without improvement in patient outcomes. Despite the robust number of tympanostomy tube procedures in the United States, there remains a paucity of data scrutinizing

3 Fig. 2. Mean procedure costs per hospital. variations in this practice. Few databases are able to successfully capture the information regarding potential unwarranted variation in costs. This study was able to incorporate such cost analyses using the Intermountain EDW data. Significant variation in pediatric tympanostomy tube placement was identified not only among surgeons but also among hospitals. The results from this study demonstrate significant variation among facilities in costs for tympanostomy tube placement in children. There is more than a twofold difference in monetary resources utilized between the most and least expensive hospitals for the same procedure. Each hospital within the Intermountain system uses the same cost-accounting system. However, several factors may explain cost discrepancies between hospitals. Some variation in expenses could be attributable to differences in overhead costs between hospitals. Equipment and services in the OR vary at different institutions, leading to a discrepancy in cost per minute in the OR. Additionally, time spent in the OR or preoperative and postoperative areas could differ between hospitals, accounting for some additional variation in costs. In a truly capitated health system or bundled payment model, incentives may drive common, simple procedures such as tympanostomy tube placement to less expensive facilities. This would be an onus for more costly hospitals to identify innovative approaches to reduce the costs for these common procedures in order to remain competitive. This study found that a significant portion of the costs for outpatient tympanostomy tube placement in hospitals was accrued in the preoperative area (31%) and postoperative recovery area (18%). The OR only accounted for 34% of costs, whereas the OR often assumes a greater proportion of the overall costs of care for outpatient procedures. Many children after tube placement bypass recovery in the PACU, which accounted for 5% of costs because most children did not use the PACU. Costs for the preoperative and postoperative areas accrue from the nursing and hospital space that are used and are allocated per unit of time. Costs in the preoperative area also include staffing and space for patient registration, initial intake and recording of vitals, and preoperative teaching. In the hospital setting, some of these processes may be streamlined and targeted to reduce costs. A few factors may better explain why OR costs accounted for only one-third of the total costs. First, tympanostomy tube placement is a very brief procedure. Therefore, time in the OR is much shorter compared to Fig. 3. Mean procedure costs by surgeon with breakdown by category. 1937

4 TABLE I. Coefficient of Variation for Different Subcategories of Costs Across the Entire Cohort and the Range of Mean Subcategory Costs Per Surgeon at the Pediatric Outpatient Surgery Center. Subcategory Coefficient of Variation Range of Costs (by surgeon) Fig. 4. Mean total cost for each facility (bar) with the mean cost for each surgeon in that facility (dot). time in the preoperative and postoperative areas. Second, this study evaluated costs and not charges. Charges per minute in the OR often are quite inflated and do not reflect the true cost of care. Finally, the relatively high costs for preoperative care may reflect the increased costs for tympanostomy tubes placed in a hospital setting compared to a surgical center. The patients in this cohort often had the same registration, intake, and preoperative assessment as patients presenting for much more complicated procedures. Identifying strategies to streamline this process in this relatively healthy cohort could lead to significant reduction in costs. For example, in our children s hospital, all children undergoing surgery have a preoperative history and physical exam performed by a nurse practitioner. Pilot studies skipping this step in the preoperative process are currently underway. In addition to cost differences among hospitals, the results of the study also underscore variation among individual surgeons. Some of this variation is secondary to underlying differences between hospitals related to the reasons discussed above and outside the surgeons control. However, Figure 4 demonstrates that even within the same facility there are robust differences in the cost of the procedure by each otolaryngologist. The greatest sources of variation directly linked to surgeon practices were operative time and pharmacy costs. Although faster operations will cost less, safety risks and potential complications with quicker surgeries are Fig. 5. Mean operating room time for each facility (bar) and the mean time for each surgeon in that facility (dot) Total cost.251 $662 $902 Pharmacy.773 $27 $135 Supply costs.686 $18 $44 Postanesthesia care unit.670 $24 $44 Postoperative SDS.616 $124 $149 Anesthesia.561 $0 $27 OR.474 $200 $349 Preoperative SDS.200 $204 $247 SDS 5 same-day surgery. unknown. This study did not evaluate whether operative time correlated with outcomes or complications, but this could be explored in future studies. An ideal operative time that provides the fewest complications but remains efficient could be determined in the future. Ototopical drops are often prescribed to decrease the risk of posttympanostomy otorrhea and ventilation tube occlusion. The majority of studies have demonstrated a significant reduction in posttympanostomy otorrhea, with application of ototopical therapy compared with no treatment. 12 However, results are debatable when comparing types and duration of topical therapy. Roland et al. showed a 1.1 day reduction in time to cessation of otorrhea with ciprofloxacin plus dexamethasone (Alcon Laboratories, Fort Worth, TX) compared to ciprofloxacin (Alcon Laboratories, Fort Worth, TX). 13 However, at 2 weeks there was no significant difference between the two groups in either clinical response or microbial eradication. 13 Conversely, other studies comparing topical antibiotics alone versus topical antibiotic with steroids demonstrated that the risk ratio at 2 to 3 weeks was not significant. 14,15 Furthermore, some may contend that other less-expensive topical therapies can reduce otorrhea rates, such as middle ear irrigation with saline immediately after tube insertion. Kocaturk et al. showed decreased prevalence of otorrhea at 2 weeks from 30% in control children to 16% treated with saline irrigation. The same study showed no statistically significant difference between the saline group and children treated with a prolonged application of ofloxacin. 16 Given the conflicting results from multiple studies, no single ototopical therapy has proven superior. Our results identify pharmacy costs as a potential target to reduce expenditures. In our cohort, ciprofloxacin plus dexamethasone otic suspension (Alcon Laboratories, Fort Worth, TX), ofloxacin otic (Bausch & Lomb, Tampa, FL), or sulfacetamide sodium plus prednisolone sodium phosphate (Bausch & Lomb, Tampa, FL) are typically administered and prescribed following surgery. Using Ciprodex drops can directly increase the costs of the procedure by 10% to 15%. The duty to cut unnecessary spending falls not only on the health care system as a whole but also places the individual physician accountable. Surgeons can decrease medical care costs and waste if

5 they are cognizant of options that directly impact the cost of services provided. 17 Additional studies delineating patient outcomes relative to cost reduction are needed. This study has several strengths. The EDW costbased accounting system records hospital and supply costs and thus more accurately depicts resource utilization. Economic analyses utilizing charge as a proxy for cost can be erroneous. Charges are often several magnitudes higher than actual facility costs, thereby overestimating true expenses. 18 In addition, the large sample size increases the power of our statistical analysis and the cross-sectional cohort contains data on procedures performed by multiple otolaryngologists. The study is not limited to an academic tertiary setting but is applicable to private and hospital-employed surgeons. Although the Intermountain cost data in this study will naturally have regional differences to other hospitals in the United States, we expect that most health systems would have similar variation to the 15 hospitals in our study that span rural, community, and urban centers. As such, the results are an excellent representation of care for multiple centers with differing capacities across the U.S. medical system. This study delineates how hospitals account for costs for tympanostomy tubes and identify areas that system and individual providers could target to decrease costs. Choosing less-expensive ototopical drops, when appropriate, could decrease costs by up to 15% in some cases. More efficient use of operative time may also decrease costs for some surgeons. Streamlining preoperative and postoperative system processes within individual hospitals could also reduce the cost of care. Despite these strengths, the use of an administrative database has inherent limitations. We cannot overcome the biases of a retrospective observational study and electronic database, which are limited by accurate coding. There may be discrepancies in how costs are accounted for across facilities. Not all hospitals within the Intermountain system were included in the study because some did not include pharmacy costs. This study only contains costs to the hospital regardless of thirdparty payers or insurance coverage. Therefore, differences in charges or pricing for ototopical drops dependent on patient s insurance coverage are not impacted by our results. In our system, surgeons typically use drops intraoperatively and are given an outpatient prescription, which is then filled at the hospital. In cases when drops were used, we determined the cost of the bottle to the hospital and did not include any outpatient pharmacy charges. In addition, residents were involved in a portion of the procedures performed in one of the hospitals by five of the surgeons. Surgeons in training could likely have increased the operative time and therefore the costs in some cases. However, we could not delineate those cases, and differences remained among surgeons in the absence of resident involvement at the other 14 hospitals. Lastly, we were unable to measure patient-reported outcomes or complications associated with these procedures. Future investigations are warranted to evaluate the relationship between procedure costs and outcomes. A better understanding of how operative time and choice of ototopical drops impact postoperative tympanostomy tube otorrhea, occlusion, or early extrusion will be necessary to identify care that will deliver the best value to the patient. CONCLUSION This study identified significant variation in cost for outpatient tympanostomy tube placement among hospitals and surgeons. A better understanding of such discrepancies will motivate otolaryngologists to adjust their practices to promote cost savings. At the hospital level, an activity-based cost database can identify sources of variation and prospective strategies to decrease waste. Further research is needed to elucidate factors accounting for these variations in cost and physician practices and the overall impact on patient outcomes. BIBLIOGRAPHY 1. Sidell D, Shapiro NL, Bhattacharyya N. Demographic influences on antibiotic prescribing for pediatric acute otitis media. Otolaryngol Head Neck Surg 2012;146: Cullen KA, Hall MJ, Golosinskiy A. Ambulatory surgery in the United States, Natl Health Stat Report 2009: Ahmed S, Shapiro NL, Bhattacharyya N. Incremental health care utilization and costs for acute otitis media in children. Laryngoscope 2014;124: Alsarraf R, Jung CJ, Perkins J, Crowley C, Alsarraf NW, Gates GA. Measuring the indirect and direct costs of acute otitis media. Arch Otolaryngol Head Neck Surg 1999;125: Gates GA. Cost-effectiveness considerations in otitis media treatment. 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