Longitudinal Trends in Costs for Hospitalizations at Children's Hospitals

Area of Science:

• Healthcare Management
• Pediatric Health Economics
• Value-Based Care

Background:

• Children's hospitals are implementing value-based improvement initiatives to enhance patient outcomes and reduce healthcare expenditures.
• Current value-based efforts often concentrate on specific medical conditions, potentially overlooking broader cost drivers.
• Analyzing overall admission costs is crucial for strategic prioritization of improvement initiatives.

Purpose of the Study:

• To examine cost drivers across all pediatric hospital admissions.
• To identify specific service lines and billing categories with the highest cost growth.
• To inform strategic prioritization of value-based improvement efforts in children's hospitals.

Main Methods:

• Utilized Pediatric Health Information System data from 2010-2017.
• Aggregated discharge data into service lines and billing categories.
• Calculated mean annual cost growth per discharge relative to 2010 total costs for medical and surgical service lines, and assessed changes in length of stay.

Main Results:

• Mean annual cost growth per discharge was comparable for aggregated medical (2.6%) and surgical (2.7%) service lines.
• Top-growing medical service lines included oncology (3.5%), reproductive services (2.9%), and nonsurgical orthopedics (2.8%).
• Leading surgical service lines for cost growth were solid organ transplant (3.7%), ophthalmology (3.3%), and otolaryngology (2.9%).

Conclusions:

• Room costs were a consistent driver of increased expenditures, independent of length of stay.
• Value-based healthcare strategies must address the impact of rising room costs on patient outcomes.
• Prioritizing initiatives focused on room cost containment is essential for effective value-based care in pediatric settings.