Urban trauma care is threatened by inadequate reimbursement

Hospitals struggle to support trauma care. Recent installation of cost accounting systems now provides information on actual costs for different categories of patients. This paper examines the cost of trauma care in an urban teaching hospital.

All patients entered into the hospital trauma registry for the period July 1, 1996, through June 30, 1997, were abstracted from the registry. These data were merged with a database of all admitted patients with an injury-compatible ICD-9 diagnostic code for the same time period that included cost and estimated revenue from the cost accounting system. Complete data were available for 667 patients and the remaining 96 were uninsured patients with missing cost data.

The calculated cost of care for the 667 patients was $10,342,130; total expected revenue was $10,396,456; estimated net revenue for insured patients was $54,326. The estimated cost of care for the 96 uncompensated patients was $1,619,989. The hospital had positive net revenue for patients with length of stay of 7 days or less, but was unable to recoup costs for patients with a longer stay. Reimbursement exceeded hospital cost for blunt injuries, primarily motor vehicle crash victims, and for other injuries covered by fee-for-service insurers. Managed care plans and government-funded insurance did not reimburse sufficiently to cover hospital costs.

These data confirm that earlier literature, based on charges and estimated costs, were correct in documenting a serious threat to the continuation of centers providing high volumes of trauma care.