Time-Driven activity-based costing identifies opportunities for process efficiency and cost optimization for...

Area of Science:

• Pediatric Urology
• Health Economics
• Surgical Innovation

Background:

• Robot-assisted laparoscopic pyeloplasty (RALP) is a common pediatric procedure, but its true cost is not well-defined.
• Time-driven activity-based costing (TDABC) offers a novel approach to assess institutional costs in healthcare.

Purpose of the Study:

• To determine the actual cost of pediatric RALP using TDABC.
• To compare TDABC costs with traditional cost accounting methods.
• To identify opportunities for cost reduction and efficiency improvement in RALP.

Main Methods:

• Defined the RALP care pathway from pre-operative admission to post-anesthesia care unit (PACU) discharge.
• Utilized process maps and interdisciplinary teams to survey RALP activities.
• Calculated procedure costs using TDABC, incorporating personnel and asset costs based on time stamps from electronic medical records and prospective timing.

Main Results:

• TDABC calculated a total RALP cost of $15,319 per case, including direct, indirect, and capital robot costs.
• Traditional cost accounting estimated costs at $16,158 per case.
• Current robot utilization is 22%, increasing RALP costs by 16%; significant time variances were noted in pre-operative services, robotic console, and PACU.

Conclusions:

• TDABC accurately reflects cost variations in RALP, particularly concerning robot utilization.
• Traditional cost accounting overestimates the actual costs associated with RALP.
• TDABC identified high-cost and high-variability areas within the RALP process for targeted improvements.